Truth 3: A Crisis is a Terrible Thing to Waste

Moving forward and looking into the future is the name of the game. Crisis management has emerged as very strong field in these days in relation to business.

The author is of the view that mostly organizations don't take tough decisions on their own, until and unless it has to be done and there are not a lot of choices. this is one point which differentiates innovative organizations from the rest of the clan.

The real point is that when you are facing a crisis situation you can take it as an opportunity or threat as you may want it to look like. The thinking about threat will lead to inertia while opportunistic mind set will lead to innovation.

In case of IKEA, it faced different crisis in different era. As written in the text,

"IKEA’s history is a sequence of such choices. Competition with other mail order
firms led to its first showroom. Supplier boycotts led to it designing and building
its own furniture. Transportation problems led to the flat pack concept. A
showroom fire led to a much bigger showroom concept. Insufficient numbers of
sales people at the showroom launch led to the self-service idea. It would have
been easy to waste each crisis but instead they inspired innovation."

This is an example of reactive thinking. The writer is of the view that waiting for the crisis to drive the innovation is not the right strategy because such an innovation may not drive as much benefits for the organization as it may have done otherwise.

The need of the time is to develop a proactive thinking like Intel, where the goal is that no matter what the processor speed has to be doubled in a period of two years. it can be done by tools like scenario planning where you look at the possible future situations and plan accordingly. For such proactive thinking you have to "Create links in time". It means that you look at your past, present and the possible future and then make strategies accordingly. This, in the longer run, will lead to a position for your organization where you will be able to stand in the hard times as well.

However this thinking about the future, according to the author, may lead to a  paranoid organization. It means that the organization is limited in the expansion of its business and it is always thinking of the current products. Here I differ with the write in the sense that it also leads to specialization and this specialization also drives growth.  

Soon the next truth will be discussed on this blog :) Truth4:A GREAT INNOVATION DESERVES A GREAT NAME