I wish I’d read this excellent article by Gilbert, Eyring and Foster earlier. While there is quite an extensive cannon written about innovation and disruption, entrepreneurship and transformation, I’ve struggled to see the practical application and evidence in most theories.
In particular, it’s been difficult to reconcile what I saw as two competing strategies to survival within the context of disruption: some argue for rethinking an organization’s model, while other suggest an “if you can’t beat them, join them” approach which would have established businesses trying to adapt to the “New World Order” introduced by disruptive innovators.
This article does a great job of aligning the two perspectives: they are not competitive, but are rather complementary, both necessary, and should occur simultaneously.
The teachings of Transformation A and B as described in “Two routes to resilience” apply very nicely to ACME, an organization I worked for through Fall 2019. ACME is an advertising agency, similar in structure to the description in the Coursera modules, and also similar to the hyperbole seen in “Mad Men”. Like most competitors, it’s owned by a holding company (about 80K global employees) with ~35K employees specific to its advertising & communications business.
Many factors have contributed to the recent and continual revenue decline seen across the advertising industry, however the major trends include a move away from “just” advertising towards more complete, end-to-end marketing “solutions”. Noticeable trends include (1) established “Big 4” consulting firms (eg, Accenture, Deloitte) entering the market and offering more strategic and advisory services, (2) an increased emphasis on measurable outcomes and “proven” results based on data and analytics (vs. traditional focus groups and market research), and (3) an increased expectation of technology solutions for marketing (aka “mar-tech”) automation (eg, through Chatbots, CRM).
Faced with what seems like an inevitable future of layoffs and eventual closure, ACME decided to embark upon a transformation in 2018 (although it was indirect and without a clear strategy).
ACME’s “A Transformation” involved repositioning its core business as a full-service agency with strategic experts. While agencies have a bad reputation for expecting young executives and designers to “burn the midnight oil” with all-nighters and dramatic live client pitches (*this is true and does happen regularly), ACME committed to recruiting more experienced staff who could offer more complex and strategic services.
ACME’s “B Transformation” saw the creation of “ACME Digital”, a new division combining all previously-separate digital teams (web, email, strategy). While unofficial, it is understood that this new division is the future of the company that will eventually become the profit center.
Interestingly, ACME’s transformations also made use of a “capabilities exchange”: both the President and the CEO frequently decided which individuals or teams would be shared (or not) in the new business.
I’d love to offer an insight into the evolution of ACME’s transformations, but they are still underway and will likely continue through 2020. Recent reports suggest that collaboration has been rocky and uncomfortable, mostly due to a lack of clear communication and strategy.
- Gilbert, C., Eyring, M., & Foster, R. N. (2012). Two routes to resilience. Harvard Business Review, 90(12), 65-73.