In his column for the American edition of Fast Company, businessman, investor and Managing Partner of the international holding TECHIIA Yura Lazebnikov tells how to understand that it is time to make changes, not mistakes.
Business success is definitely about changes and adaptation. This is what Richard Branson tells us. But he forgets to mention the fact that the need for change becomes obvious only when it is too late. More agile colleagues will not wait for you to catch up, solve operational problems, and master new technologies that everyone has already implemented.
So at what point should the changes be started in the company so you are not among those who catch up, or even worse — among those who exist only in memory and on the pages of history? Here is what Yura Lazebnikov, the Managing Partner of TECHIIA Holding, recommends paying attention to.
TECHIIA is an international technology holding founded by Yura Lazebnikov and Oleg Krot. The holding unites expertise in 10 business areas: development of IT products and services, creation, distribution, and sale of content, production, and sale of merch, provision of services based on unmanned technologies, production of innovative insulated glass units, etc. The company has representative offices in Cyprus, Ukraine, and the USA.
Signal 1 — New technologies emerge in your industry
Technological experiments and testing of various systems are very expensive. From a financial point of view, every tool is worth something. From the perspective of time — you need it to implement new technology at least partially, investigate its effectiveness, and decide whether to fully implement or test the next offer. From the perspective of human resources — you need to train the team. It is worth considering that business processes slow down during adaptation — this is a normal and natural phenomenon.
And yet, despite the cost of technological innovations, you should not ignore new solutions. It is better to start earlier to give yourself time to choose the implementation format that is proper for your company.
Expenditure and the prospect of losing momentum should not be an argument in favor of refusal. Otherwise, your business may find itself in the place of the mobile phone manufacturer Nokia. They were so focused on improving the devices that they didn’t notice the market demand for mobile software development. So many years have passed, and the company has not yet caught up with either Android or iOS.
Signal 2 — the market changes requests
Analyzing the market, communicating with customers, and predicting trends is the most important part of the manager’s work. Even if it takes up to 80% of the work time, it is justified. In words, everything is simple: find out what your potential customer wants and give it to them. Whether it is an electric car, vegan sausage, or real or virtual entertainment, if your business can’t adapt to people’s demands, it will probably cease to exist soon. After all, there is always someone else who can satisfy consumer needs.
The skill you need to train is to sense the change in demand. If not, your business will suffer the fate of the Hummer car project. In 1992, after the purchase of the first civilian serial car by Arnold Schwarzenegger, the demand for cars was simply crazy. But with the boost of green trends in society and the energy crisis, this demand began to fall. In 2009, the project was closed. In the summer, the media began to write about the revival of Hummer in an electric version. Trends are more important than traditions. At least for those who want to earn more.
Signal 3 — Your profits decline
An increase in profits shows that the business is growing properly. However, it happens that the profit decreases during the period of active growth of the company. Infrastructure development, and hiring new people to the team sometimes “squeeze” more money than you earn at the moment. That’s the price for being able to serve many large clients.
But what to do if there is no active growth, and profits are still getting smaller? Look for the “root of evil”. And you’d better start doing it yesterday. Because there is a chance to say goodbye to your business in whole or in part. As it happened with Compaq Computer, which lost the competition to Dell. Hewlett-Packard eventually absorbed Compaq.
Signal 4 — you believe your product to be the most comprehensive
The most comprehensive service or product is almost the same as a perpetual motion machine. Everyone talks about it, but no one has seen it in wide use. Yet everyone has seen competition: if you don’t offer a relevant service, someone else will. And earn instead of you.
If you believe that your product cannot be improved, trouble is at your door. And it knocks loudly. Stability is an extremely bad sign of a business project. It is a synonym for stagnation and stands one step away from degradation.
Business is a living organism, a child. It cannot be the same for a long time. It grows — and this is the only norm. As well as constantly adjusting the strategy. Anyone who doesn’t heed this advice will go down in history just like Blockbuster, the world’s largest distributor of games and videos, once did.
You can’t stand still. The only possible stability is constant growth.
