There are still those out there, who have yet to be convinced that their business is in the Danger Zone and now is time for War Time Leadership. Here’s how to tell…
There is a sudden realization of a fast-moving lethal threat to your organization or entire industry. This can be:
- New technology that will cause a paradigm shift (like the leap from paper to digital, or from the traditional flat web to Augmented or Virtual reality).
- Black Swan Event – unpredictable event with severe consequences (like a global pandemic and economic shutdown).
- A competitor making an aggressive move in the market, and coming for your customers.
- A rapid loss or contraction of available customers or resources for your products (your target market suddenly loses their paychecks)
- A combination of events that sends a sudden surge of competitors into your market, (eg everyone suddenly shifting their business online because of a pandemic).
Basically, if it’s a do-or-die, hyper-competitive situation, it’s time to summon your war-time leaders.
The sudden contraction in available customers or key resources, or inundation from other firms in the same business you’re in, creates a hyper-competitive, black swan event. When the stakes are do-or-die, the vultures are circling, and or someone/something is coming out to get you. This is when war is upon you. So does the current business climate warrant a war-time footing?
Is the coronavirus pandemic, and economic shutdown, a black-swan, hyper-competitive event?
Consider the following:
There were already pre-existing conditions of a kind of cold war for every business that relied on marketing via the web. There was already a global Fight for AIR before this was happening – The attention economy, creation of the personal brand, fragmented, divided and disconnected everyone, every individual to direct and indirect competition with each other. Grandma is fighting for attention and influence and relevance with shoe companies and hot girls of Instagram in terms of her grandson’s attention. This was a cold war, this was critical information known to a few but felt by all.
But things got much worse, and much more competitive for just about everyone.
Among other things, the digital marketplace got exponentially more competitive.
Just 60 short days ago, many businesses were not digitized at all. And now, the demand for all who can work from home just created a tidal wave of digital transformation.
Virtually overnight, each and every one of your direct and indirect competitors was forced to digitize their business operations, distribute their workforce for remote work, and convey their messages via the web. As the market adjusts, every business flooding the online marketplace as it is the only market left to do business. This is a flood of direct competition for attention even if from indirect competitors.
On the upside, this may slow them down at first. They may be scrambling or panicking, giving you precious time to get ahead of the game. Eventually, those that can afford the lost operational time, will adjust and will be coming for your slice of the market.
The government is sanctioning “essential” and effectively “non-essential” businesses to shut down or hamstring themselves. In so doing they picking winners and side-lining their competitors. This is effectively state-controlled, nationalization of businesses (socialism). The lawsuits that will rise out of this will be many. Good news as usual for law firms.This is great news if you’re a big company like Walmart, Target, or major fast food chain.
For the vast majority of businesses, this just put you in the fight of your life with one or both arms tied behind your back. I’m not pulling any punches here, because it’s clear even to a 5th grader what’s happening here, and how horrible this is and will be (and the lawsuits that will be jamming up our system on all fronts).
The online surge also means increased advertising costs (we’re already seeing), and lower reach. If you’ve seen social media feed lately, they’re flooded with ads for all sorts of magic, easy buttons, and snake oil, more than ever before.
Basic Economic Lessons
Supply went through the roof virtually overnight – The supply of available, online solutions and digital businesses continues to go up, as literally everyone and their mother was forced to resort to doing business on the digital marketplace.
This creates a surge of supply that, combined with the decrease of demand due to a tanking/idling economy, means that the market is exponentially more competitive, the available number of customers is shrinking rapidly, and those that remain are extremely price-sensitive. This usually results in price wars, great for customers bad for business.