How future-proof is your business?
1. Don’t put all your eggs in one basket.
Companies that rely on a single product for most or all their revenue could be jeopardizing their own futures. Consider how smartphones upended the camera industry or how high-speed internet signaled the beginning of the end of video rental stores. Future-ready companies protect against obsolescence by continually thinking of ways to diversify their portfolios, expand their sales methods or update their products to maintain relevancy. Similar risks exist if a company’s success depends too much on a small group of employees or suppliers. To withstand unexpected shocks, bench strength matters.
2. Identify and manage risks.
Over-reliance on a particular product or facet of your business is only one of the many risks that could threaten a company’s long-term viability. Other threats include data breaches or cyberattacks that could expose customer information or cripple your operations. Failure to comply with regulatory requirements can lead to fines and product recalls. Lapses in quality control may result in product defects and legal action.
While you cannot always predict what risks might imperil your company at any given time, you can take steps to identify and mitigate them. A company at risk of fraud or theft, for example, might look for all the possible ways an intruder might enter its facilities or systems and force a “must not fail” operation to malfunction. Backstops can then be created for weak points where operations are subject to sabotage.
3. Track trends that influence markets and customers.
Future-proof companies look outside their own bubble for insight and inspiration. They stay abreast of new technologies and trends locally and around the world—even those that may not relate directly to their product or industry.
Referring to our previous example, the introduction of smartphones and high-speed internet did more than disrupt the camera and movie rental industries. It also opened the door to mobile banking and facilitated new ways of making and processing payments. Banks capitalized on those technologies by developing the industry-changing products and services that have enhanced the way many consumers and businesses now manage their financial lives. Forward-thinking organizations stay ahead of the curve by continuing to anticipate needs and tailoring solutions to address them.
4. Listen to your customers.
A future-proof company understands that its customers’ needs and preferences change over time. Mobile banking—not unlike online shopping, ride-sharing apps and a host of other internet-enabled technologies—was viewed with skepticism by the masses before achieving widespread acceptance. By paying attention to how users talk about and experience your products and services, you can gain valuable insights on opportunities for improvement. Customers can also provide an early warning system should your offerings come up short in comparison to others on the market. Their feedback can be one of the best future-proofing tools at your disposal.
5. Cultivate a culture that encourages agility and innovation.
The strategies and tactics that helped your company reach today’s goals need to be adaptable and able to transform over time. In other words, the status quo is rarely future-friendly. To create a future-proof company, you need a culture that favors agility, encourages calculated risk-taking and rewards innovation. Successful cultures persistently seek to improve products, processes and strategies.
Developing such a culture does not happen overnight. Often it means building teams of creative thinkers who represent diverse backgrounds and perspectives. Leaders must also adapt an innovative mindset, allowing leeway for roles to diverge from their original purpose and for projects to be delivered in new ways.
6. Future-proof your workforce, too.
The workforce in a future-proof company is always evolving, as is the nature of the work they perform. For example, data science and digital skills may be much more valuable to your company’s future than they were to its past. These skills may need to be seeded throughout your organization, along with a range of new tools and platforms.
That doesn’t necessarily mean looking outside of your current staff to fill new positions. A recent Harvard Business Review report found that 60% of a company’s future roles can be filled by current employees, assuming adequate training is available. Even so, you may want to rethink the skills that will be most valuable in an increasingly tech-enabled future, along with your hiring, training and compensation strategies. Future-proof companies prefer talent that is adaptable, creative and comfortable with change.
The bottom line:
The future may be unpredictable, but the risks before us also can often be identified and managed. Companies that remain in-demand and up-to-date do so by remaining flexible with people, technology and systems that allow them to pivot when it’s necessary to change or adapt. That’s what future-proofing is all about.
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• How to future-proof your company | McKinsey
• Future-Proofing Your Organization (hbr.org)
• How To Future Proof Your Business – 8 Proven Strategies (profitbooks.net)
• The History and Evolution of Mobile Banking – Blog – Shoutem