Perhaps You Haven’t Yet Escaped Y2K...
You probably have the same desire in business.Serving in various leadership roles, I commonly found myself wishing for the option to build new services from scratch, rather than wrestle with legacy encumbrances.
In 1999, I was appointed CEO of one of the world's foremost Y2K consultancies. The entire company was engineered around solving one particular problem, the millennial date change.I leapt into the role with the belief that there were assets in that company - smart people, trusted client relationships, detailed knowledge of corporate applications and insight into complex operating environments - that would one day allow us to develop a new set of marketable services.
Sure, there might be a dip in the financial performance of the company as we re-tooled for the future ... that would be expected. Having come from a world of running complex global operations, I knew that there would be great demand for accomplished practitioners in combing the hairball of systems that most companies use to run their business.Surely a Y2K consultancy could be relevant after the passing of that one event. Right? Those assets were to be leveraged, weren't they?
We didn’t count on the dot.com burst. Those weren't the best years to reinvent a small publicly-listed, one-trick pony. We ended up selling the firm.Across many industries today, I sense a similar ambition for reinvention. They look to their current assets - organizations, talent, products, clients, etc. - with the hope that those can be refreshed for relevance in new economic conditions.
Almost every executive enjoys the intellectual exercise of a "greenfield" design. What would you do if you were starting your company today? Increasingly, this way of thinking is fueled by nimble competitors and even activist investors. If someone else can build a better mousetrap without the burden of existing people, processes, and business constraints, shouldn't you be able to take those same actions?This notion reads much easier than it lives. It’s a tough ask to be able to see through the obstructions of present-day business burdens to reimagine a business that truly leverages assets in a new model. It takes hard scrutiny to recognize which of your current assets are truly valuable for the future versus being a drag on your ability to change. Blockbuster probably thought their retail footprint was an asset.
In 2000-2001, many industries rebooted. Companies failed. Others merged. Fortunes were lost. Unbridled optimism for bright and shiny new business models overtook common sense. Neither the hare nor the tortoise survived.There's a real art in designing for the future when so much disruption and change is occurring all around us. Almost feels like a millennial date problem, doesn't it?
Peter Allen has many years of operating experience as a top executive of rapidly-growing multi-billion dollar companies and in assessing sales and marketing effectiveness. He is now a Boston-based Managing Director at Alvarez & Marsal.