3 reasons why you might inadvertently be running a factory
Despite the steady growth of the ‘digitally hapless hall of fame’, whose honourees include GE, Kodak, Toys R Us and Nokia, many business leaders are pressing on with their industrial era business models as if we had just hit ‘peak-Victorian.
Unfortunately for these leaders, the golden age of ‘synthetic certainty’ has now past and we are back on the cruel savanna, albeit a digitally enhanced one.
Nonetheless you might be thinking that your organisation is all set for a long and glorious future. You have invested in AI and have a portfolio of blockchain and IoT initiatives on the go. And boy, does your website look good on a phone!
Well, here’s the bad news. The digital age is not the industrial age amped up on tech steroids. A smarter, faster, cheaper Titanic is still the Titanic. Even an iceberg detecting one will struggle with the arrival of commercial air transportation.
So how can you tell if you are still working within or presiding over an industrial era operation? Here are three simple tests:
Centralised leadership: Your organisation believes that all the important decisions must be made by a handful of people in a well-appointed room near or at the top of the building. The belief being that all the other brains in the organisation are not capable of doing much more than process work.
Process-focus: You have identified a market and you are doing very well in it. So, you believe that the next step is to simply polish the factory machinery to create a slicker and more profitable operation.
Past successes: The belief that past successes are indicative of future successes is quite common. This is a corollary of the previous belief. ‘What made us great will continue to make us great’. ‘Sweat the cash cow’. The end of synthetic certainty makes this a false belief. Reality is approaching fast in all directions and in unfamiliar guises.
So what can you do?
Strategically, you need to develop new business models that provide other sources of cash should, or when, your ‘plan A’ fails. This requires you to up the number of your business model experiments and rapidly increase your failure velocity. Failure is learning. Learning is development.
Failure to fail is fatal.
Operationally, do not pull up the floorboards, sack your people, or worse still try to turn them into creatives, or in any way threaten your existing cash flows.
Transformation of industrial era business models doesn’t work.
Personally, if you are a leader, you need to understand how the world is changing, what are the new rules of the game and then develop a portfolio of business models that adhere to certain principles.
If you are one of the workers, you possibly need to reset your notion of a career and focus more on remaining economically-relevant on a real-time basis. Staying in play means adding value in a manner that robots and algorithms cannot replicate. If you follow a manual, live in a spreadsheet or have a desk at the base of a hopper, you are positioned squarely in the path of the digital tsunami. You need to move now.
You don’t look good in a boilersuit
You don’t need to be wearing a hardhat or a boilersuit to work in a factory. Many factories today are furnished. Some even have pool tables and juice bars. But they are factories nonetheless. We do need factories of course, it’s just that increasingly we don’t need people in them.
If you are a leader or a worker who developed your skills in the industrial era, its time for a reset.
In the digital age, the market values value. How you acquired that value making capability is a detail.
Bottom line, past successes and experience are not enough to thrive in the digital age.