How leaders should think about the importance of determining what is most important to change next.

Over time, organizations perform at some level.  After start-up things fall into place leading to a period of rapid growth.

Click on the graphic above for a walk through of the content in this post.

The rate of growth eventually slows and then plateaus perhaps due to new technology that spawns competition or maybe due to the organization slowing down in the face of its increased scope, scale, and complexity of operations.

At any point along the way there are three choices:

  • One is to keep doing things the way they have always been done.  Most of the time keeping things the same is the right answer because to do otherwise means constant change which leads to chaos.  On the other hand if an organization always only does that which it has done to be successful up to now someone or something will eventually overtake and possibly bury it.  One-product organizations such as some that sold buggy whips, record players, and video rentals are examples of those that rode a wave to oblivion. 
  • A second option is to change a little which can improve things for a while but if an organization only ever changes at the margin it runs the risk of creeping incrementalism and eventually it too might fade away.  A recent example of an organization suffering from creeping incrementalism is the Canadian firm Research in Motion which makes the BlackBerry.
  • The third choice is breakthrough change to reach an entirely new level of improved performance where the cycle starts anew.  Apple is a good example with its introduction of new products and entire product lines, as some say it is about to do again with Apple TV; IBM is also a good example in that it makes more money now from providing services than it does from hardware even though they still go by the name IBM and will likely never change to IBS!

Successful organizations have one step-function improvement after another and leadership’s job is always to determine what is most important to next change and do differently.

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