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LEADERSHIP IS A PROCESS OF SOCIAL INFLUENCE, WHICH MAXIMISES THE EFFORTS OF OTHERS TOWARDS THE ACHIEVEMENT OF A SHARED GOAL.
Wednesday, February 26, 2014
Most companies wait until a crisis point to launch a transformational initiative.
However, in today’s environment, companies need to embrace pre-emptive transformation.
Four types of companies succeed at pre-emptive transformation:
These companies continuously evolve their business models by making small changes. McDonald’s, which rode the 1960s baby boom by drawing teenagers into the workforce and harnessed globalisation in the 1970s and 1980s to expand globally, is an example.
A company of this type maintains a balance between exploitation of existing strengths and exploration, even after finding a successful model. For example, digital-technology and chip company Qualcomm uses returns from past successes (e.g. WCDMA) to fuel future ones (e.g. LTE).
These companies seek to drive industry-level change rather than become victims of it. Amazon, for example, generates razor-thin profits because it continually reinvests in its future, and even in self-disruption (as with the Kindle in 2007).
These companies run a portfolio of businesses and actively adjust their emphasis over time. 3M, for example, has more than 35 business units divided among 6 reporting segments, and its strategic acquisitions and divestments reflect the evolving demand landscape.
Successful pre-emptive transformers share several key traits:
A disruptive mentality
Constant focus on simplicity
Leaders today need to engage in continuous pre-emptive renewal. They need to look beyond short-term financial performance, watch for potential disruptions and shifts and then pre-emptively address them.