Market disruptions are like bad dreams for folks working in mature, established marketplaces. When your business has been predictable, profitable and comfortable for years -- even if it's far from perfect -- you're not likely to be excited to wake up one day to find that you've lost half your customers, new competitors have entered your market and deliver comparable value at one-tenth of your cost structure -- and your own products, which you have been selling for years, have been exposed as overpriced and wasteful.
How do you think folks in incumbent, analog-based media and advertising companies have felt waking up over the past ten years as digital networked communications has devastated the status quo in their markets? For many of them, this daily disruption has been like a bad dream. They would like to wake up one day and find it was just that -- a bad dream -- but, alas, each and every morning, it's still there. Every morning they wake up to an ever-more-powerful Internet and its ever-growing progeny of Web services and apps and devices.
Many incumbent media companies are adapting to the disruptions and finding their way to new businesses and new opportunities, but many have not. Why? Because they have responded differently to this bad dream. Here's what I mean:
Think it's just a bad dream and will go away. I am amazed about how many in media and advertising believe that the technology-borne disruptions of these past ten years are cyclical phenomena that will go away. Rather than adapting or innovating a new future, they cling to the past and go to sleep each night praying that the morning will be different. It is, but generally for the worse.
Kill the messengers. For many, the best way to ignore change is to remove change agents from your organization. As long as people you work with toe the party line, then you don't have to really confront change. This insulation is usually quite effective in maintaining peace of mind in the short term. It's usually disastrous in the long term.
Ignore the "stability agents." I learned of the extraordinary concept of the "stability agent" from friend and noted media economist Jack Myers. As Jack relates, most institutions are designed not to change, and folks who are true "change agents" are rarely ever successful in changing their institutions. Rather, what institutions want, and what folks who aspire to be change agents should embrace, is to find and create institutional stability in the changing world. Just as companies cannot afford to ignore messengers with bad news, they also can't ignore folks working to realign their businesses to changing environments. They should be embracing these stability agents.
Scramble the egg. I find it amazing how, when key financial and market metrics are going in the wrong direction, companies will try to change the metrics -- or scramble the egg -- so folks don't know how bad things are going. When newspaper and magazine circulation started to decline, the industry tried to get everyone to shift away from circulation metrics to readership metrics, since they were bigger. It's not unusual to see companies in market declines do big acquisitions, ostensibly to look for new areas of growth, but frequently because it gives them a chance to change the story, and distract folks from the fundamental problems in their core business.
What are some of your best stories of how folks have tried to deal with the bad dream of disruption?