A good business is a lot like a shark: they’re a force, but when they stop moving they’re dead in the water. Innovation and reinvention is crucial to longevity in any business, because what got you here won’t necessarily keep you here. You have to keep moving and innovating.
In culture we praise the disruptors but in essence disruptors are often just picking the low-hanging fruit of stale or non-existent innovation. Look at Uber: a company that took full advantage of shortcomings in the taxi business. In Toronto, the 3,500 registered cabbies charge a premium for a service that often leaves passengers feeling gouged and dissatisfied. San Francisco-based Uber spotted the emergence of the ‘gig’ economy across North America, and through a dispatch-removing app, realized anyone with a late model sedan was a potential cab driver.
Now, passengers pay less and experience the convenience of using an app to hail a “cab.” And drivers hold the power to run a side hustle, which puts them in the driver’s seat for earning potential. Uber is genius, don’t get me wrong, but the 100-year-old business model that saw little reinvention was the sitting-duck.
A company that has realized the harsh result of refusing to change with the times is Toys-R-Us. What once was a behemoth at the top of every Christmas shopper’s to-do list from the 70’s to the 90’s made some poor financial decisions in the early 2000s leaving them strapped for cash when e-commerce became the new retail marketplace. This failure to adapt to market demands resulted in the closure or sale of all 735 of its U.S. locations in March.
“Brick-and-mortar stores are just getting bludgeoned to death by e-commerce,” bankruptcy lawyer Corali Lopez-Castro said to Business Insider. “I don’t think people will miss Toys R Us… because everything you can get at Toys R Us, you can get online.”
There are plenty of stories out there where proper planning and foresight positioned old ideas strongly into today’s business world. American Express was born out of the California gold rush in 1848. A migration of settlers and prospectors created a need to transfer telegrams and cash from the west coast to the east. That’s where American Express came in.
By 1891, they created a new product: Travelers checks. By the turn of the century they had a world-wide network of currency exchange branches. After World War 1, they began catering to the high-end tourism market, organizing and promoting luxury tours and cruises, including the first ever “around the world” cruise in 1922. By 1956, Amex began offering a charge card. They launched it with a $6 annual fee – $1 more than Diner’s Club – the only other charge card provider at the time. The increased fee was to establish themselves as a prestigious option.
American Express reinvented themselves, noting who they were and who they wanted to serve.
Apple is another example of constant adaptation and re-invention. And they did it by reinventing what other companies were already doing. Apple didn’t create the home computer, but made it better through human-focused design.
In the early 80s, Legendary CEO Steve Jobs and his design team improved on the already established DOS-based PCs by pioneering an icon-based interface that anyone could use. They re-invented laptops and desktop PCs by making them fun and attractive, holding user experience as paramount – something nobody else was doing. Under Jobs’ lead, Apple adjusted their focus to handheld devices with the invention of the iPod. They weren’t the first to offer a digital music player, but they offered one that was easy and fun to use.
“This is what customers pay us for: to sweat all these details so it’s easy and pleasant for them to use our computers,” said Jobs in a 2001 interview. “That doesn’t mean we don’t listen to customers, but it’s hard for them to tell you what they want when they’ve never seen anything remotely like it.”
Reinvention is possible and it’s essential to longevity for any brand, company or idea. Gone are the days of the old adage, “if it’s not broke, don’t fix it.” The truth is, anything can and needs to be analyzed for improvement and efficiency. “But truly great companies don’t scramble to adapt to the future, because they create the future,” notes Greg Satell, writing for the Harvard Business Review. “Take a look at any great business and it becomes clear that what made it great wasn’t the ability to pivot, but a dedication to creating, delivering, and capturing new value in the marketplace.”
And if you don’t do it, someone else will!
Matt Pasut is president of CR Creative Co., located in Wyoming, Ont. www.crcreativeco.com. Reprinted with permission.