Because companies that continuously evolve will triumph. The forward is in bestselling author Seth Godin’s recent book Survival Is Not Enough. The book provides some original ideas to apply this truth of nature to individuals and organizations – in actions and decisions that we control daily. Companies that dominate their markets have the highest market share.
I immediately recognized this as true. Years ago I was moved by a presentation from Victor Tang that differentiated the companies that dominated their markets from other leaders, followers, and the others who wonder what happened. He went on to identify the characteristics of these different types of companies.
Companies that dominate their markets have the highest market share. They deliver the highest value and superior service. Their organizations the most extensive and extended. Most importantly, they are effective innovators, fast learners, with employees filled with energy, enthusiasm, and excitement.
Nipping at their heels are other leaders. Their market share is growing because they clearly differentiated their offerings, formed alliances, and created healthy, customer-driven, cross-functional organizations.
In contrast, a sales-driven company is just another competitor. They are fast followers. They have routine straight-line financial planning. They compete in market segments, and are organized by departments with a functional orientation.
Survivors struggle to hold their customers. They react to market forces and must compete on price. Which brings us back to Seth’s point: survival is not enough, it’s heading for extinction.
Both Godlin and Tang highlight the importance of countering the various forces that are acting on a firm with a culture of continuous innovation and initiatives – even if many fail. These forces include competitors, new technologies, legislative changes, changing demographics, cultural demands, and others that cause the proverbial business issues for each company that keep an executive “awake at night”. What is common is that they are changing the status-quo, and unless acted upon will cause the firm to lose effectiveness. The companies that dominate a market are those companies that capitalize on the changing conditions.