Can You Handle The Discomfort Needed to Grow?

Twenty-five years ago, I was managing sales and marketing for a small, up-and-coming financial software company. My CEO handed me a book that would grow to be my favorite business book: "The Innovator's Dilemma".

In Clayton Christensen's review of disruptive innovation and technology, he details how large, successful companies often inadvertently lose their market dominance to tiny, new, and nimble competitors. New players gradually refine their technology with strategic innovations surpass the incumbent's offerings, eventually redefining and capturing the market.

The phenomenon can be explained by two key factors. First, the value of innovation is on a constant "bell curve" and successive product iterations provide diminishing returns. Additionally, incumbent companies, while possessing a large customer base, are typically burdened by high sales expectations, investors and costs, which constrains their ability to innovate.

Here is Christensen's theory of disruptive innovation challenges traditional management thinking:

1. Resource Dependence: Existing customers will heavily influence a company's resource allocation.
2. Market Impact: Small, emerging markets struggle to influence an incumbent's large, established market so they opt to disrupt.
3. Technological Futures: The trajectory of disruptive technologies is unpredictable, making it difficult to anticipate their impact once matured.
4. Organizational Value: An organization's value extends beyond its employees to include its processes and core capabilities, driving its innovation efforts.
5. Demand Dynamics: The attributes that make disruptive technologies unattractive in established markets often hold the greatest value in emerging markets.

Christensen suggests several strategies for incumbents:

1. Target the Right Customers: Develop disruptive technologies for markets beyond the incumbent's current customer base.
2. Create Autonomous Organizations: Place disruptive technologies in separate, autonomous entities that can focus on small customer segments and achieve incremental wins.
3. Embrace Failure: Experiment with disruptive technologies early and frequently to identify the most viable options.
4. Utilize Resources Smartly: Allow the disruptive organization access to the company's resources while maintaining separate processes and values to encourage innovation.

There Once Was a Small Gaming Company...

Jensen Huang, CEO of the incredible Nvidia, talks about working on " Zero-Billion Dollar Markets" for decades to create and take over previously insignificant and unrecognized opportunities. Today, Nvidia owns.....Graphic Chips, Parallel Processing GPUs, and Artificial Intelligence Data Centers. Huang had a vision, and he stuck to that vision, even when markets took down the company's value by 80%, not once, but twice!

Once in a Generation...

Admit it, B2B sales motions, technologies and tactics have not evolved much over the last 25 years and they are ripe for change. However, surviving Covid along with the advancement of fast-paced social media has - in my estimation - changed how business people interact. A shift has occurred. We have become more private and exclusive in our conversations and approachability. Couple these social circumstances with the advent of robocalling and mass email spam tools, and you can quickly understand why any business executive automatically "raise the shields" on any attempt at contact from someone they do not recognize or know. So maybe get to know them first?

You Can't Handle The Truth....

In "A Few Good Men" Jack spoke and captured the fact that none of us like to be made aware of unpleasant facts. He closed with "You can't handle the truth" and "You want me out there". Change is scary and planning for a business environment that may not yet exist, but is certainly coming into focus today, may seem like an unfounded emotional response. Leaders in the C-suite must become the drivers of the ongoing charge for change.

You're Gonna Hate This...

While it may not be a "Zero-Billion Dollar Market", you should realize that your legacy communication process is exactly the opposite of what buyers, customers, investors, and employees actually want from your business. A new selling model is emerging, and you should be driving this. If not, your new nimble competitor will.

Are your BDR's calling and emailing every week? Are your marketing teams promoting cool capabilities and other macro benefits? How many thousands of your annual budget are allocated to trade shows comprised of 60% sales and marketing folks who are focused on looking for new gigs?

In my experience, B2B communication today must be founded in long-term relationship building. This is unpopular as a thesis, because of the time investment required to do so successfully. Decide if you are serving your clients "Hungry-Man TV Dinners" or "Farm-to-Table Curated Dining Experiences"? One is quick, pre-configured, and artificial, the other is not. Which do most prefer and remember?

Social Selling is the current moniker associated with developing ongoing relationships that lead to trust and commerce via LinkedIn and other social town squares. Have a look at this graphic contrasting legacy outreach to social relationship outreach.

Now, ask yourself these 7 Key CEO Sales Self-Awareness Questions:

1. Do you, the CEO, view yourself as the "tip of the spear" on what your company believes in and messages to the world
2. Do you as the CEO share creative insights and market findings with everyone, including your competitors?
3. Do you expect sales to be transacted in a CEO-to-CEO format, or via your salespeople driving this with once, or twice-removed buyer teams?
4. Do you make a concerted weekly effort to communicate with all CEO constituents (employees, investors, customers, partners and buyers)?
5. Do you have an exec "closing playbook" that includes CEO outreach with your large deals and/or renewals for each quarter?
6. Do you feel a responsibility to cultivate an ongoing and growing set of executive relationships and idea-sharing options in your network?
7. Finally, are you willing to give and cultivate subject-matter credibility and relationships without any form of "payback"?

If these seven items do not evoke a strong affirmation with you, then you may be experiencing a dangerous level of confidence and hubris.

BTW, I failed to share earlier that Jensen Huang also said he would never recommend anyone build a company like Nvidia. He reasons that it is far too hard and takes far too long to do this with excellence. Most don't have the patience.

Where do you start? Where is your industry trending? Why? Who are the start-ups that are doing radical things that will never work?

Self-awareness is mostly unpleasant but always necessary....

So audit your competitive innovation path. Objective assessments of the circumstance and competitive horizon are extremely critical. Be honest, and form your thesis, once you convince yourself you are on track, lay down a logical path to reinvention and improvement.

Never bring in your team and/or advisors to the discussion until the above steps have completed. Rinse and repeat until you have the conviction to "be out on that wall", as Jack said...

Amplify AI offers Social Selling and Executive Optimization Services. Find us at www.amplifyainow.com