In a blog post I wrote last year titled We're Not a Bookstore. We're a Venue That Happens to Sell Books I discussed one of the the most important questions a CEO can ask him/herself (Peter Drucker's seed question):
What business am I in?
Excerpts from that post include:
- Had railroad executives in the early 1900s realized that they were in the transportation business, rather than the railroad business, they could have moved into trucking and air transport, rather than letting other companies dominate.
- Had newspapers understood they were in the information business, rather than the print business, they would have adapted more successfully to the Internet.
History is littered with failed businesses who never quite figured out what business they were in.
An equally important - and related - question I challenge myself and other executives I speak with to think about each month is:
How can we maintain our company's relevance?
(I can pretty much guarantee that doing exactly what you are doing today will not be good enough five years from now).
These are probably the most important questions a CEO can ponder.
Because your answers to these questions shape your entire strategy and give you insights to the investments you need to make TODAY to ensure your company is still relevant 5-10 years out - which by the way, may be how long it takes for your investments to pan out (think Oracle's HRMS Fusion). By the way, read Bill Kutik's excellent article on Oracle's Fusion product in his recent column "Reading Oracle's Tea Leaves".
What's the cost of not addressing these questions or answering them too late?
Ask companies like Polaroid or Smith Corona. Or the too-many-to-list-here HR technology and services vendors who failed to adapt to changing market forces.
Adding to the difficulty - and importance - of answering these questions is that in the rapidly evolving marketplace of technology each innovation (e.g., multi-tenant applications, social networking, cloud computing, etc.) poses threats of substitution to established companies. And guess what? We are ALL in the marketplace of technology.
Getting SUCCESSFUL companies to give serious thought to these questions and then actually doing something about it is particularly difficult because success is the enemy of innovation. Or, in the lyrics of Ray Davies:
And those who are successful,
Be always on your guard,
Success walks hand in hand with failure
There is less incentive to take risks when you own a cash cow.
So set aside some time each month to give serious thought to these questions - and ask your teams to do the same. You'll be surprised at what you discover.
What business am I in?
How can we maintain our company's relevance?Labels: business strategy, HR technology, peter drucker
