A New World Order: The Time to Adapt or Die is Now

“It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is most adaptable to change.”

As I write this, life as I have known it for my entire existence has been upended and drastically altered. The Covid-19 pandemic has swept across the globe impacting billions of people, physically, mentally and financially. One of the most shocking characteristics was just how quickly this happened. The speed with which our lives changed has been so sudden, that in the space of a week billions of us went from the top of Maslow’s Pyramid straight down to the bottom, focused only on fulfilling our most basic of needs such as health, food and shelter.

Not only were we as individuals caught off guard, but many businesses both large and small also felt the sudden impact. There has been carnage in the financial markets as previously well performing stocks plummeted, and whole industries like travel, hospitality, and retail ground to a complete halt almost overnight. Companies of all shapes and sizes struggled to respond to the continuously changing impact of the Covid-19, with many still scrambling to maintain continuity of operations.

Of course this is not the first time in recent history that the world has faced significant uncertainty. Two World Wars, the Great Depression, the Cold War, and more recently the GFC all impacted our lives by creating a level of uncertainty about how we would survive. Uncertainty is baked into our day to day life, but nothing makes us feel this uncertainty quite like a crisis.

Who Do You Call in a Crisis?

As it turns out, there are people out there that we regularly rely upon when shit gets real. People that get called in when things start to unravel, that find themselves shrouded in uncertain environments every day, and who know exactly what to do in a crisis.

The men and women of our armed forces are accustomed to living and working with uncertainty every single day. For them, it is the most basic and primal question that they often lack certainty over; will I survive the day? In fact, uncertainty is so much a part of their lives that the US military named this concept in the 1980’s and began teaching it to their recruits as the acronym VUCA (Volatility, Uncertainty, Complexity, Ambiguity). In the years since, VUCA has been adopted and become common terminology within large organisations, used to describe the rapidly changing business environments within which they operate. And what a wild ride it has been for these companies.

Never before has the business landscape been more volatile, uncertain, complex and ambiguous than it has been over the last 30 years. Fuelled by rapid advancements in technology, continuously evolving customer expectations, and increased competition brought on by lower barriers to entry, companies have had the past 30 years to perfect how to respond to significant changes in their business. They have conducted “agile transformations” and launched innovation labs, delivered design thinking training and embedded a culture of customer centricity. With all of this planning and preparation you would think they would be well placed to respond to change, no matter how significant. Yet many of these organisations have been found wanting, only realising now that instead of having transformed into an agile leopard they are actually just a lumbering elephant dressed up in leopard print.

Necessity Is the Mother of Invention

Covid-19’s impact was sudden, significant and all encompassing. However it has not necessarily been the best resourced and most “transformed” companies that have fared the best.

“Death levels all things”

Cicero

Death is the great equalizer, and no matter who you are, when you are staring down the barrel of your own survival you only have two real options; adapt or die.

In the past week alone I have seen many examples of companies choosing to adapt rather than die. Gin distilleries have become hand sanitiser companies, restaurants have become catering companies, and a student internship company has become a labour exchange marketplace. Necessity is truly proving to be the mother of invention, with the art of the pivot never being more prevalent than it is now.

Unfortunately I have also seen many companies choosing to die rather than adapt. And yes, although it may seem harsh to label it a choice, that is exactly what it is. The choice to act or do nothing, the choice to experiment or ignore, the choice to persevere or quit. So what is it that differentiates companies that choose to adapt from those that choose to die?

What Doesn’t Kill You Makes You Stronger

“Emotion, which is suffering, ceases to be suffering as soon as we form a clear and precise picture of it.”

Baruch Spinoza

Nassim Taleb’s concept of Antifragility describes three different responses that can occur when things are exposed to disorder and chaos:

• Fragile things will be impacted by the stress and break
• Robust things will resist the stress and remain the same
• Antifragile things will absorb the stress and become stronger

Examples of antifragility can be seen in our muscles growth response to resistance training, our physical antibody response to vaccinations, the aviation industries safety response to an airline crash, and the mythical Hydra monster that could regenerate multiple heads whenever one head was cut off.

Whilst our ability to perceive stress and disorder in a positive light may seem unnatural at first, our reaction is something which is in our means to control. It is in fact up to us how we respond to the stressor; either with fragility, robustness, or antifragility.

In uncertain and chaotic times like we are in now, one of the most important and yet most basic differentiators between those businesses that adapt and those businesses that die is their mindset. A fragile mindset will crumble and close in the chaos, a robust mindset will look to get through it and come out unscathed, while an antifragile mindset will look for opportunities they can capitalise on and prosper from.

“…everything can be taken from a man but one thing: the last of the human freedoms — to choose one’s attitude in any given set of circumstances, to choose one’s own way.”

Victor Frankl

Antifragility is as much an outlook and mindset as anything else. External events are out of our control and will bring chaos and disorder into our lives when they arrive. How we view them and how we choose to respond is up to us.

The Art of the Pivot

Wanting to respond to change and knowing how to respond to change are two seperate things. While all businesses know the game has changed, not all businesses know how to respond to this change. The organisations who are are adapting are doing the following:

1. Doubling Down on Their Customers: This is the not the time to forget your customer. Now more than ever, as customers are rapidly re-evaluating what they deem valuable and what they do not, it is critical to continue speaking to, empathising with, and understanding your customers needs
2. Placing Small Bets: Understanding how to validate an idea cheaply, quickly and effectively is still a core capability many companies haven’t nailed. Being able to reduce the risk and uncertainty of an idea as quickly as possible is critical. Companies that are adapting to this new Covid-19 environment are able to do this well by placing a few small bets, investing in the ones that bear fruit and quickly killing off the ones that don’t.
3. Zeroing in on Commercial Value: While many industries have declined or ground to a halt in the wake of Covid-19, there are also some that haven’t. Companies that are adapting well are refocusing their teams on the industry verticals that have been least impacted, as well as those that are likely to bounce back the fastest when the situation starts to improve. They are prioritising their focus on the commercial viability of their business model, and continually looking to adapt their model to what customers are currently seeing value in.

Get Comfortable Being Uncomfortable

When you’re in a dark place, you sometimes tend to think you’ve been buried, but perhaps you’ve been planted. Bloom.

The impacts of Covid-19 will be far reaching and long lasting, with the only thing being certain is that things will continue to change at an extremely fast pace. Life will be uncertain, chaotic, and for most of us, uncomfortable for a very long time to come. But it is in this discomfort that we must become comfortable because it is here that our new opportunities to succeed exist.

It is also worth remembering that every economic downturn we have ever experienced has advanced us exponentially as a society, forging better products, better processes, better business models and entirely new industries.

For those of us who are looking not just to endure these times but to be strengthened by them, if we can pivot the value we provide to our customers and the way in which we provide it we will likely emerge from this turbulent period better than when we went in.

Adapt or Die has never been more real.

About the Author: Josh is a Product and Innovation Lead at Hypothesis Consulting, a people focused digital transformation business. By helping clients follow an evidence based approach focused on the end customer, he is able to embed innovation across their business and uncover new opportunities to fuel future growth. He is a passionate believer in the power of technology and investment to enable large scale social impact and economic empowerment.