Business Volatility: three steps to surviving global change
Rapid and unpredictable changes in technology are turning business management into a rollercoaster - here's how to cling on, and enjoy the ride…
Volatility is our new state of being. Technological change has upended our climate, our politics and our social structures. We’re in a transition from an old world to a new world, and volatility is one of the symptoms of that change.
How the hell do we cope?
As a word, volatility is routinely associated with either market volatility — rapid swings and changes in company market capitalisation, often during swings from bull to bear markets — or volatile personalities — people prone to wild behaviour swings. Both are treated as conditions to be managed, and there’s good established advice for both.
But political and life volatility? That’s more complex. And, inevitably, it’s where we’re standing right now. But we still need to manage it, and that means letting go of some of the comforting fictions of the past.
The idea of technology enabling a straight line progression into a better future, is not just dead, it’s buried — and with a stake through its heart, just to be on the safe side. Much of our volatility right now is around the consequences of technology. There’s the carbon issue, which Martin explored, that is heralding a volatile future for the weather patterns on our planet, as they shift around. The astonishingly widespread bushfires in Australia through late 2019 and early 2020 are just a foretaste of what might well be coming.
The pace of technology change is showing no signs of slowing, and we haven’t yet fully processed the changes we’ve already seen. How do we survive this era? How do we keep managing our businesses — and our lives — in such volatile times? If you look to the people and companies that are managing it well (so far…), there’s some clear lessons you can learn.
Here’s three steps everyone can take:
1. Keep your eyes on the prize
Do you really know where you’re going in life? Or in business? Most people don’t. They think about the mechanics of what they do, but not the underlying philosophy. They think about what they do, but not why they do it. But in volatile times, what you do is more controllable than how you do it.
Political, climate and technological volatility can take away the how very quickly — politics change trading agreements, the climate reshapes the landscape you live in, technology renders the tools you’re using obsolete. But if you understand what you are doing at a fundamental level, you are able to adapt.
- Do you publish newspapers — or report news?
- Do you make desktop computers — or do you try to make the world better through computing?
Elon Musk, for all his personal volatility — and that’s a seemingly inexhaustible supply, right there — has this mastered. Pretty much everything he is doing is centred around making human life more sustainable on this planet, be it through Tesla EVs or Solar City solar roof tiles.
2. Don’t get precious about the details
In volatile times, the details of how you achieved what you’ve set out to do become, well, mutable. And if you cling onto the method rather than the goal for too long, you’re toast.
This is what very nearly happened to Microsoft. Its prize was providing great paid computing services to businesses. In the Steve Ballmer era of the business, they became obsessed in doing that through the Windows/Office duopoly, and nothing else. It nearly killed them, when the market went another way. Satya Nadella wasn’t precious about the details. He put Office everywhere, let go of the obsession with Windows, and built a great cloud business that catered to the needs of 21st century business, not 20th century ones.
Microsoft is still servicing business computing needs — it’s just shifted the details of how it does that.
To take another example, I recently wrote about my former employer — Reed Business Information — and how it had changed into a fundamentally different business. This is a perfect example of a company that kept its eyes on the prize, but didn’t get precious about the details. The prize was providing business information that they could charge for. The details shifted from journalistic products to data, software and analysis.
It’s a completely different business — but doing the same thing.
To give you a counter-example, let’s head back to Apple. One detail that Apple has got hung up on is manufacturing in China. With global tensions rising around the country, that could become a bigger risk to the company than any competitor.
3. Keep your mind — and your eyes — open
The first two points are fine — but they both fail, if you can’t see change when it’s upon you. Business as usual is not an option. Martin has already explored the problems with that idea.
People love business as usual, they delight in best practice, because it’s comfortable. It’s tried, and tested. It’s relatable. Nobody ever got fired for buying IBM — until they did.
Volatile times are not comfortable times. We can't hide from that however uncomfortable it might be. And once you know you’re dealing with discomfort, you can stare it in the face. And so, this is actually the hardest of the three steps. You need to let go of the security blanket of the stable state, and embrace the agile life, of open-mindedness and change.
You can only adapt if you look outwards, and see change coming towards you. Listen not just to the loudest voices — but also to the quiet ones, the ones who are looking further off, and who have a track record of spotting what’s coming.
Volatility has a sibling, and its name is uncertainty. Even the most open eyes can’t ave you from that. But if you are to survive volatility you need to embrace uncertainty, too.
And doing that might be harder still.