Complexity:: Strategy and the ‘threatened’ business model


It would be wrong to say that I am in total agreement with the content of this article but that is simply because, courtesy of Ontonix, I hold an ‘informational advantage’! That is because, of course, it is a great deal easier to identify which products, services or aspects of the operation are dragging the model down when you can, objectively, identify sources of internal [endogenous] risk and measure their impact upon the stability [or resilience] of a complex system.

But there is a lot of good stuff that I would highly recommend. Particularly for those readers who have already determined (subjectively) that any downward trend is temporary, a result of ‘bad’ luck/timing, financial volatility or unforeseeable uncertainty. Of course, you may be right but you COULD be wrong and your inaction might only be exacerbating the problem…or accelerating the rate of decline.

I dread to think how much valuable resource is wasted by organisations treating symptoms that are self-generated. John Seddon, a leading ‘Systems Thinker’, talks (with some humour) about the need to address the right problem instead of, inadvertently, creating more "failure demand". It would be fair to say that with an understanding of the complexity of business systems – aided of course by a means to identify and address sources of risk and uncertainty – even the business owners, without whom the organisation may not have come into being, can learn a great deal about a business they feel they know intimately.

But this ‘mistress’ has secrets that will remain hidden unless they are coaxed out…

Business ecosystem

The Gravity of Risk Can Slowly Crush Business Models

Executives must proactively assess their business model, and do so on a regular basis. What was once a great business engine can grow less viable years later because it has become outdated or ineffective due to market shifts or new developments in industry’s business environmental conditions. It is the course all businesses must run, facing the need to change along the way in order to survive.

Risks are about events that, when triggered, cause problems. Hence, risk identification can start with the source of problems, or with the problem itself. It is important to remember that risks emanate from threats, but the manifestations are much broader and may be internal or external to the organization.

Strategy and the Threatened Business Model | Corporate Strategic Planning | Strategic Planning Articles and Resources | Management Consulting Services Firm | Business Strategy Consulting.

Creative ‘deconstruction’:: Innovate Your Business Model


In such a fast-moving economy Opportunities & Threats emerge from the environment at such pace that an effective, resilient, ecosystem are prerequisites. Not since the dawning of the Industrial Revolution has the need for ‘organisational adaptability’ and agility been so apparent.  image

“…even with a concrete business model, there may come a time to modify and innovate it.  So, the question is:

What circumstances require business model innovation?

There are five circumstances that often require business model innovation.  They can be categorized into Opportunities and Needs…

via » Deconstruct and Innovate Your Business Model.

Kodak:: NOT too big to fail…and not alone!


In the Digital Age, inter-connected “business systems” have transformed the business environment, at a pace that exposed the fragility of the institutional model: financial; political; religious; media.

A, morally and financially, corrupt “ME culture”, that spread, like a virus, ‘hidden’ in a high growth, high leverage, high DEBT banking model that, by disguising debt as credit, created addicts hooked on the illusion of prosperity whilst feeding the greed of its creators and exponential growth in financial and social inequality.

Self-similar [self-serving] hierarchical structures and unsustainable strategies.

A model, so unused to dealing with negative ‘feedback’, that its most successful exponents became highly skilled in the arts of ambiguity and manipulation. Accompanied by the inability to distinguish good from bad or fact from fiction, they unquestioningly executed strategies born of, obviously, flawed theories and, like joining Cosa Nostra, once you’re in getting out is a little tricky!

Such self-serving enterprises, lacking in meaningful two-way communication and unable, or willing, to discern noise from signals can ‘miss’ vital signs in their environment. The excessive complexity and close-coupled relationships, it has created to strip value from the system, impedes the ability to adapt at the pace of more ‘agile’ competitors.

Fragile in an uncertain economic environment; vulnerable to the impact of “minor” internal or external sudden – unforeseen NOT unforeseeable – changes.

These once mighty institutions are under increasing pressure from, innovative, client-centric “hub & spoke” business models; transparent; structured and aligned to aid the [non-linear] digital information-flow that underpins functionality, effectiveness and innovation.

The world HAS already changed: sink or survive?


Sometimes, despite my best efforts, I cannot resist sharing Seth Godin’s wisdom! This is particularly difficult when he hits on a point that I have been making time and again as I try to communicate the URGENT need for change, specifically within in Financial Services and Risk management.

Risk Leaders (Godin’s artists) and early adopters will be the “winners”…other will just have to trust to luck!

When the world changes…

It’s painful, expensive, time-consuming, stressful and ultimately pointless to work overtime to preserve your dying business model.

All the lobbying, the lawsuits, the ad campaigns and most of all, the hand-wringing, aren’t going to change anything at all. In fact, instead of postponing the outcome you fear, they probably accelerate it.

The history of media and technology is an endless series of failed rearguard actions as industry leaders attempt to solidify their positions on a bed of quicksand.

Again and again the winners are individuals and organizations that spot opportunities in the next thing, as opposed to those that would demonize, marginalize or illegalize (is that a word?) it. Breaking systems that benefit your customers is dumb. Taking money from lobbyists to break those systems is dumber still.

Let Seth inform and inspire you..

Seth Godin interview on Canadian tv

Five Reasons Companies Fail at Business Model Innovation – HBR


Several years ago when I first read these words from Clay Shirky they really resonated as far as my own industry [insurance] was concerned.

“It is easier to understand that you face competition than obsolescence”

In the intervening period a great deal has changed…not necessarily for the better. But too much has remained the same. As I read recently “Nowadays, competition is mainly taking place between business models rather than just between products and services…”. It is true.

Business models that are unsustainable but still function in the current environment, are now showing the outward signs of frailty. Fragile businesses lack the agility to adapt for survival in a post-critical financial landscape.

Read more of this post