Mixed marketing metaphors.

There is no such thing as "equalibrium", just constant change.

There is no such thing as “equalibrium”, just constant change.

I have a mate who is an academic economist, a really smart guy used to arguing a point of view, and with a box of stats on call to support any contention he makes, alternatively to pull down anything that runs contrary to his argument.

He is very convincing.

An ongoing debate has been around the nature of management, and particularly marketing in the face of the changes that have been wrought by the digital revolution. His view, if I can summarise, is that the forces that have emerged will find a new point of equilibrium, and it is our task as managers to identify that point, minimise costs on the path towards it, then be in a position to leverage for the maximum outcome when it is reached.

Economics 101.

My contention is that the assumption that an equilibrium will be found is flawed, and that the better analogy is the ecosystem, constantly evolving and changing in response to the adjustment of the forces that interact on the inhabitants, and the better strategy is to assume that everything will change, some things over night, some with a bit more lead time, and the forces that are interacting to drive the changes are not necessarily evident from wherever it is you sit.

My evidence, in contrast to his is all anecdotal and perspective, challenging for an econometrician.

Often I refer him to the antitrust suit brought by the US government against the “monopoly” that Microsoft had, an action that was finally binned by President Clinton. The equilibrium argument suggested that the Microsoft empire would endure and continue to crush competitors, and that the brakes had to be imposed externally, when the  reality is that Linux came along, followed by the rise and rise of Apple, emergence of Android, and within a very few years Microsoft was relegated to the role of an also-ran, albeit one with a mountain of cash.

Enterprises of any type and size that fail to accommodate the ecosystem metaphor, preferring to rely on an emerging equilibrium that they can leverage is in for a long wait, and ultimately a visit to the insolvency practitioner, unless of course they are a public body in which case the just continue to cry poor, and suck at the teat of the taxpayer.

My conclusion therefore is that there is  no new equilibrium on the horizon, continuous and pervasive change is with us and the only thing that will change is the speed of the changes themselves, and our ability to respond.

Planning to disrupt your apparent equilibrium, the existing business model that has served well is a confronting undertaking, but a necessary one for commercial survival. A depth of experience an understanding of the traps can save much heartache, so I would be happy to apply my experience to help navigate a path.

 

About strategyaudit

StrategyAudit is a boutique strategy and marketing consultancy concentrating on the challenges of the medium sized manufacturing businesses that make up the backbone of our economy. The particular focus is on their strategic and marketing development. as well as the business and operational efficiency improvements necessary for day to day commercial survival. We not only give advice, we go down "into the weeds" to ensure and enable implementation.
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