“Helen, check this out!” Kenny says with urgency.
“Helen! You have to see what they are up to now!”, Kenny says with even a greater sense of urgency.
“Who Kenny, who are up to what?”, Helen answers.
“You know, those guys I have been telling you about, the ones that are copying what we do in our online business”
“Let me see” Helen responds back to Kenny.
“You are so right, it looks like they have a similar catalogue, but wait look at this…. Wow!” Helen says as she leans back into her chair.
Have you ever had a time when your competitors absolutely wowed you like they just did with Helen?
You see Helen Lee runs a fashion business that had its roots in retail stores in high streets across London, but has recently expanded into an online portal where her business is now starting to sell and ship to clients globally.
Her high end fashion label garments are sourced through family connections in China which she traditionally imported in to the UK, but she thinks it may be possible now to ship directly from the factory in China. That is if she can get all the moving parts working together. But the presence of this direct competitor in her market is stressing her out. They seem to be moving very fast and gaining a loyal following, well so it seems at least.
Transitioning into new business models is not easy.
It requires planning and of course doing things differently. Particular it is a challenge when there are new entrants into your market that seem to be re-writing the rules of business – the very same rules that your business once wrote in the old days of bricks and mortar!
So what can be done? How would you help Helen? What advice would you provide her?
Would you tell her to get out of high street shops and concentrate on online only? Or would you suggest she needs to keep doing what she is doing currently, a dual strategy that crosses from tradition to the digital economy?
Well we are probably sure of one thing, within Helen’s extended family, she is likely to be getting a lot of advice, but where to start first?
Helen however is a very smart and successful business woman. Its just that she is faced with a new challenge. So she decided to do something that she did when she first set up her business years ago and felt she should revisit this again. In fact, she reflected on that it should have been something she routinely undertook because it was likely that if she did, she would not be in the situation she is in today.
Helen called her key managers in for a meeting. She said there was a need for “time out” and she explained to them their predicament. She asked them to consider this over the next week, where they would spend a full day, or more if they have to, together brainstorming ideas, but also looking at their strengths, weaknesses, opportunities and threats – yes that’s right, a whole day doing a SWOT Analysis!
Would you have suggested to Helen a similar activity?
Perhaps, perhaps not.
There is an interesting concept known as the Contingency Theory of Change, in a nut shell, it just means there are many varying factors so that one response for one situation gets a certain type of outcome but repeating this same response in a different context can get an entirely different outcome. As for Helen, clearly she understood an “intervention” was required and her business acumen drew her to more objective analysis of the situation by using a strategic planning tool such as the SWOT. Helen was also astute to know if things had to be turned around, she needed all of her team to be on-board as well.
We will follow up on Helen in a future post, to see how the workshop and the SWOT Analysis went.
The key message though, is that we can get off track very easily in business.
Our best intentions are there and we think we are doing all the right things and working very hard at it, but then the rules change and if we do not respond and sometimes respond fast, well we will be out of business.
Many years ago Joel Barker wrote the book “The Paradigm Shift” . At the time he spoke of companies like Kodak and Swiss watch makers and how they had to re-invent themselves.
However, the paradigm shift today is probably more relevant, considering the speed of these shifts and their global impact. You do not have to go far when we think of the new economy businesses today like Uber and AirBNB and how disruptive they are to the markets they are in.