Accelerate or break in the curve
Research shows that companies that speed up rather than slowing down approaching challenging times secure great headway when the prospects normalize. The decisive factors are management’s ability to capture opportunities and translate these into new business models through innovation and the use of new technology.
The corporate market is currently extremely challenging, and for many companies, the spillover effects will rival those of the financial crisis in 2009. It is during such difficult times that boards and executives get tested, especially since many of the courageous decisions must be made on gut feelings. It’s not about taking unreasonable chances, but having the knowledge, experience and insight in management to choose the right mix of accelerating and slowing down to stake out the best future course. The world-renowned analysis company Gartner uses metaphors from the sport when describing what the winners did after the financial crisis:
«As a Formula 1 driver or a speed skater, they accelerated into the curve when others slowed down. Thus, they obtained much greater speed leaving the curve and gained an edge that the competitors never overtook.”
Dynamic capacity describes those who succeed
With market fluctuations and unexpected crises, with the right management capacity and a dynamic work culture, valuable insights may be captured which provide new opportunities for growth. The constraints in the markets and new forms of work we experience as result of isolation are forcing smarter ways to solve tasks and deliver services. The ability to detect (sensing), capture (seizing) and change to new ways of working and offering in the market (transforming) are attributes that the economist and authority in industrial organization, David Teece,, refers to as dynamic capacity.
Significant market shares can now be captured by the companies who identify opportunities, make them resonate in the company’s capacity, and translate them into new offers and forms of work.
Research from Gartner supports ability to change as a winning recipe
Said Gartner interviewed over 1,000 global technology leaders earlier this year. Particularly, he looked at what characterized the businesses that succeed best after crises: greater investment in new technology, better ability to attract the best heads, and faster to market with new initiatives and concepts. The top 25 percent of the most successful businesses listed these common denominators as important prerequisites:
- Clear leadership. They had a vision that was rooted in employees, customers and partners. The business strategy was clear and understandable
- Close collaboration between CEO and CIO provided greater understanding of how new technology should be used to create competitive advantage and new business models
- Skilled to see opportunities and detect threats before others. They acted with the risk of creating growth over time, also at the expense of this year’s profits
- Strengthened the company’s ability to change by working with culture and working methods
Major adjustments after the oil crisis
The obvious consequence of the situation we are dealing with is the effort to reduce costs and risk. It is a fact that in demanding times creativity increases, and many exciting business models are created. For both established companies and entrepreneurs, the oil crisis in 2014 was the starting point for business ideas that set new directions. Our customer NOFI was a star example of such a conversion. When the meltdown came, the company was quick to reallocate oil engineers into aquaculture, and was rewarded with innovations on a continuous basis, which can also be read about in this article in Dagens Næringsliv.
– We strengthened our focus on aquaculture, and now aquaculture and floating jetties account for 50-60 per cent of sales, says development manager Dag Nilsen to DN.
New exciting business models that need to be protected
Using new digital experiences, forced by these corona times, opportunities are created. The most important driver is how proficient the company is to take advantage of new technology and smarter working methods, where the range is from software for interaction, video conferencing, and to all the smart opportunities within, among other things. Industry 4.0 technology.
In the change processes, the company must focus on how to secure ownership of the new business models using IP design.
We are now moving more and more away from traditional IP services when we talk about competitive advantages that can be protected. It is more important to look at what customer benefit we can design IP around.
The important thing now is to lay out a strategy where the focus is on protecting the central customer benefit while at the same time having a cost-oriented focus in the process. In short: How to get the right protection at the right time and the right price.
Onsagers have long experience of assisting companies in challenging times and have technical and legal advisors who can assist in clarifying and developing a strategy on protecting intellectual property and assets. We may assist in identifying new inventions and business models and develop a strategy for how the company may secure ownership of these.
In this way, the company can now take steps to ensure good finances and jobs. To this end, the following statement from NOFI is relevant:
«Product development is very rewarding. We are not the biggest company, but we can still be the best.”
Get in touch here if this article resonates with management’s ambitions and dynamic capabilities.