Lessons in Transforming an Organization

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    The Backdrop

    During my first 20 years at the helm of Perfect Printing, the solution to running a successful business was relatively simple; provide a quality product, in a timely manner, with great customer service. Little self-promotion was required. For a 50-year period, beginning with the coming to age of television, there were four primary ways for businesses to reach their audience. Word of Mouth, Broadcast Media (TV, Radio), Print Advertising (Newspapers, Magazines), and Direct Mail. The latter two methods involved putting ink on paper. By following the business formula outlined above, success through referrals was obtainable for most every printing company.

    With the growth of electronic media, it became apparent to me early on that how organizations communicated to and with their audience was going to change. While I anticipated some change within my industry, there were two factors that changed the industry at a pace that few could have predicted. One was how quickly the change occurred in electronic media, the second was the Great Recession of 2008, and how this downturn would further disrupt an unsettled marketing and communications industry.

    The transformation of Perfect has certainly provided us with some challenges that are unique to the print industry. There are few industries that have had to cope with pace of technological change coupled with a significant change in how their product was utilized. Staffing requirements, establishing credibility in a new market and using financial resources in the most effective way, while maintaining our core values, are just some of the challenges faced. These solutions have been used by many organizations, both large and small, to change the direction of their companies as well.

    Setting the Pace

    One characteristic of successfully transformed companies is how they handle disruptive technology. Rather than stay put, successful organizations take risk in making change. In 2012, Netflix decided it was at a crossroads with their business model of providing DVD and CD’s to clients on a rental basis. Realizing that this business model was doomed because of the rapid growth of cloud content from competitors such as HBO Go and Hulu, Netflix made a decision to separate their DVD and streaming customers. Additionally, Netflix felt that they would have to gain greater control “upstream” of what their customers wanted. This led to the decision to launch exclusive content with the production of shows like Arrested Development. After having lost 800,000 subscribers just prior to separating the DVD and CD business, Netflix has added back 610,000 subscribers as of January 2013 and increased revenue by 47%.

    Another characteristic that is common among companies that have transformed themselves is their ability to invest in joomla_4eloping new capabilities in order to jump to the next capabilities curve. The leaders of these organizations realize that distinctiveness in capabilities is fleeting. There was a period when investment in technology gave Perfect a huge advantage over our competitors in regards to the ability to turn a job quickly. This advantage has significantly narrowed over time as others have invested in the same technology. To minimize this loss of advantage, I focused our investments on widening our array of services to create a new advantage against our competition.

    Amazon is a company that also recognized that they would constantly need to joomla_4elop new capabilities in order for it to thrive. Amazon initially started out with the goal of being the world’s biggest store of printed books. Founder Jeff Bezos felt that the ability to offer a wider selection would set his store apart from their brick and mortar counterparts. While achieving success in this area, Bezos realized the need to diversify and grow further. Amazon did this by expanding as distributor of products far beyond books. Most recently, when Amazon realized that the massive computer power it maintained to run its sites was underutilized, it began selling cloud services to other businesses.

    Adopting the Mentality

    Lest anyone thinks that the transformation of a business model can only be utilized by medium to large businesses the principles can be applied to small businesses as well. After 9/11, an individual named Mitchell York was laid off from his job. He decided to go out on his own. Initially he purchased a Maui Wowi Hawaiian Coffees franchise . His initial business model of a mobile franchise where he would visit different events had him working long hours and dealing with the hassle of hiring a part-time untrained workforce. This created more headaches that he was not prepared for. Deciding he needed to do something different, he reinvented the company to cater to private college and corporate events. His secret to innovating his company? Always looking for new ways to be of service and value to his clients.

    Successful leaders recognize that change and transformation in any company, while at times challenging and difficult, represent opportunities to grow and become a better, more profitable organization. For those willing to embrace disruptive technologies, look for new products and services of value to their clients, and continually improve the level of service in delivering their product, the organization should increase profitability and thrive in any market.

    To learn more about NetFlix and Maui Wowi see below:



    Photo credit: www.netflix.com

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