This is the second of four posts adapted from Dominic Pride’s talk at The Annual Strategic Forum In Health Technology on strategies for responding to digital health. We look at some of the common - but fundamentally flawed - ways companies have responded to disruption.
In our first post we outlined how health is being disrupted by huge players with different business models and tiny startups moving at speed. How did other industries respond to these forces - and how should you not react?
You can tell yourself it’s not going to happen like Nokia did when confronted with Apple’s move into smartphones. Tell the market Apple’s an elitist player and that your phones are for the masses. Tell yourself “it’s not happening” - as you go out of business.
This denial and wilful blindness is a pervasive and understandable human trait but has no place in strategy.
Hunker down, get in the bunker, stick to business as usual.
Cost cut, squeeze suppliers, lose headcount: Survive as if it’s a storm to be weathered.
That’s been the way that retail responded since 2008 - it’s a classic play which can work as long as it’s just an economic hurricane raging outside.
But when it’s more than the economy ie. it’s the fact that permanently empowered customers are rewiring the way they shop with smartphones and tablets, hiding isn’t so smart.
Retailers are still emerging, one by one into slow economic growth and have found that they’re not in Kansas anymore. The changes over the last 10 years were not just a temporary dip like in the early 90's - customers are now empowered through mobile devices and connectivity. They can compare prices, have no loyalty and this has permanently and fundamentally changed the landscape.
Customers now question if they really need to brave town centres or the out-of-town boxes to get they need, and they have options at the push of a pixel.
By this we mean deceiving yourself and your customers. You can cloak yourself in the trappings of the new. Go through the motions and create the rebrand or innovation theatre which speaks to the outside world that you’re part of the new order.
But ultimately, if you’re a Yellow Pages, however many times you rebrand, from Yell to Hibu to YP, you’ll still be a listings company - you’ll never be a Google.
“Digital changes the way people access content and services. And then it changes the nature of the services themselves.”
Unless you’re altering the fundamentals and embracing the new business models which digital can bring, you’re just putting lipstick on a pig.