Going on the Offensive in an Uncertain World

THERE IS NO QUESTION: Taking control of uncertainty is the fundamental leadership challenge of our time. We live in the age of a technology renaissance that is not only disruptive, but destructive; it is literally destroying existing industries and creating new ones. The risk of not making a shift now outweighs that of making it, and maintaining a defensive posture leads only to a shrinking business.

Companies must go on the offense to survive. The greatest advantage goes to players that create change, not just learn to live with it. Rather than waiting and reacting, these industry leaders immerse themselves in the ambiguities of the external environment, sort through them before things are settled and known, set a path and steer the organization decisively through it. They conceive of a new need or a total redefinition of an existing one, often with a new model in mind. They don’t cling to core competencies—they take advantage of new developments to create a new need among consumers, or give them a new and more compelling experience.

“You have to be able to change course more than once, yet without zigzagging so much that consumers and investors become confused about who you are.”

As CEO, you have to be able to change course, and more than once, yet without zigzagging so much that consumers and investors become confused about who you are. Those who can do this successfully will be among the attackers, not the attacked, and ultimately among the fittest who survive. The following are seven key steps to playing an offensive game.

1. Hone your perceptual acuity. Have the psychological and mental preparedness to “see around corners” and spot potentially significant anomalies, contradictions, and oddities in the external landscape, ahead of others. Some are born with this ability, but it can be learned and even institutionalized over time.

2. Be born-again. Some companies are digital from their first breath. Others, legacy companies, must think about how to harness digitization in all of its forms to provide better information about the consumer and create new and improved experiences. They cannot simply retrofit their businesses for technology; they must experience a digital rebirth. Companies can be reborn digital if their leaders have the mindset for offense and the courage to venture into uncharted waters. Macy’s, for example, is forging a rebirth, becoming an omni-channel retailer by blending store, online and mobile, and investing in technology over the past five years to improve the end-to-end consumer experience.

Some retailers may manage to remain purely bricks and mortar, but they will be in the minority. For those who choose to make the shift, be decisive. If you vacillate, a born-digital player will move swiftly to capture your juiciest, most profitable segments.

3. Learn the power of math. The single biggest instrument of change, the one creating major uncertainties and opportunities for an ever-growing universe of today’s businesses, is the  advancement of the mathematical tools called algorithms. Algorithms and the decision engines they drive process enormous amounts of data, far beyond what the brain can handle, at light speed. Companies that use these new mathematical capabilities possess a huge advantage over those that don’t, even those that have been highly successful in the past.

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Ram Charan is a world-renowned business advisor, author and speaker who has spent the past 35 years working with many top companies, CEOs and boards.

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