Every person and organization has a desire to improve performance, financial position and life in general. It is a rare exception for an entity to be content to just exist as things are. Although many of us want to accomplish or have “more,” most are reluctant to embrace change and are uncomfortable just at the thought of making change.
As individuals and organizations we often fight change. We go through the motions of pursuing our dreams and yet we may inadvertently get in our own way, because we choose the path that we are most comfortable with, the one that asks the least of us and doesn’t challenge where we are and who we are currently.
Change is Uncomfortable but Continuous
While we all resist change, it is in fact an ongoing and continuous process for everyone. Whehter we realize it or not, as humans we are highly adaptable and change with our environment. The reality is that often these changes are small, incremental and automatic. They are reactions rather than actions. The change is demanded of us in subtle but important ways. Think of the changes we make every day as automatic corrections we make in steering our lives, much like how we drive a car and adapt to road, weather, other drivers, alterations in regulations and even posted detours. When someone stops suddenly in front of us we have three choices: swerve, slam on the brakes or hit them.
Action versus Reaction
When our environment gives us limited choices in adapting to conditions, we change automatically and don’t even give it a thought. When we are challenged to act to make a change, then we have to decide how we will act … not react.
Working with companies on organizational change requires an ability to act. If a company desires more sales, then it needs to make procedural and organizational changes to accomplish this. A company that wants different results without making changes in the how, where, when, who and what is getting done is trapped in an endless, frustrating cycle. (Remember the old saying,“insanity is doing the same thing over and over and expecting different results.”)
We are all crazy at times, holding on to the comfortable habits and behaviors. Yet we must change to grow. We must change to survive. Unfortunately too many people are willing to choose comfort over change. This is often reflected in the methods and advisors they surround themselves with. A company will choose someone to advise them that will agree with them rather than a consultant or advisor who will challenge their perceptions and beliefs. They are much more comfortable with someone who shares a perspective and doesn’t push for change than someone who asks them to do something differently or requires them to act rather than react.
Content versus Comfort
The most impact will come from actively changing versus going with the flow. You may be more comfortable with the pretty repackaging of what you’ve always done versus taking a hard look at how and what you are doing, but a rose by any other name will still have thorns. To achieve different results, you have to do things differently—even when it is scary.
To improve results and achieve your goals, you must change something. What makes the difference between success and failure in making change is action and proactive behavior versus reaction and continuing to change only as much as you have to given current conditions.
The automotive industry can serve as a prime example of how steering the same course without being proactive and looking ahead can cause major problems. Ford Motor Company essentially created a market for automobiles by setting a goal of making affordable, durable cars. Then others adopted the manufacturing concept ,and along came American Motors, General Motors, etc. Henry Ford demonstrated the first episode of change resistance when he was only willing to make black cars. Then as other manufacturers provided what the customer wanted, Ford changed. By that time though, competiton was well entrenched.
As time passed, the Japanese decided to make cars. They weren’t initially of comparable quality to American vehicles, so the US automotive companies reacted only as the environment dictated. Instead of seeing the potential large changes in the industry and worldwide competition, the US automakers made small reactionary changes at best and continued to follow the course that they had always steered.
Suddenly (not really) US automakers awoke to find real competition for their customers. They continued to “repackage” the old as “new” and ignore the strides made by the competition. Then reality struck. Foreign cars not only advanced in quality and style, but also in reliability—and US manufacturing didn’t keep up. The Japanese learned the lesson that Henry Ford taught, which was to give the customer what they want: Low cost, reliable and quality vehicles.
Change needed to be content based. Not simple repackaging, renaming, or an ad campaign. The customer wanted more, and US automakers suffered because they couldn’t (or wouldn’t) deliver.
The response by US auto makers? Do more of what they’ve done. Grow bigger. Put resources into cost reduction. Cost became the driver of the industry. Reduce costs. Reduce costs. Reduce costs.
Cost Reduction Not Enough
While higher manufacturing costs may have contributed to the issue, the true bottom line for the US automotive industry was failure to grow its revenues. Many these “cost reduction initiatives” didn’t in fact reduce costs. Instead they played a financial shell game that reduced costs only on paper. (Perhaps this sounds familiar not just for automakers but government budgets and other private sector groups.) Ultimately, customers weren’t willing to pay the price charged for what they were getting, and margins eroded from price pressure as much as from cost structures, leading to the government bailout of major automotive manufacturers including General Motors.
The inability to recognize a need to do things differently becomes the biggest obstacle to success. When real cost reductions do get made, you see a real, measureable difference on the profit line. Furthermore, not all cost reductions are desirable. For years businesses and industries have worshipped at the temple of cost reductions of any kind. They have often done so at the cost (pun intended) of long-term viability and competitiveness.
Sales at Any Price
Just as indiscriminate cost cutting can damage an organization’s competitiveness, sales at any price can result in an increase in market share and erosion of profitability (short term and long term). We have only to look again at the automotive industry to see the effects of non-strategic decisions on competitiveness and organizational viability.
We have decades of automakers off-shoring manufacturing and pursuing cost cutting and market share simultaneously, while failing to grow the businesses with strategic vision in products, markets and other customer-focused factors. The lower the price of a vehicle in order to sell it, the more “cost-cutting” was pursued. And the downward cycle continues.
What was the alternative? How about building vehicles that people want at prices that are profitable, because people are willing to buy a product they want and that has value to them?
Content Is an Investment
Getting to know your customers and developing products and services that they want and need is key to increasing profitability. Working harder to sell what a “customer” doesn’t want to buy is an uphill battle that will continue to demand lower prices, more “costs” in sales, marketing, and advertising, as well as perpetuating existing paradigms and results.
© 2010 F.O.C.U.S. Resource Inc.
All Rights Reserved