Pivot Point #1

This past weekend, I was talking to a CEO friend of mine in the mail-order cosmetics industry. She has not yet fully embraced e-commerce, as the direct-mail channel is her bread and butter. She claimed to want to expand her business into the online channel, but didn’t think it fit her traditional demographic. She’s been selling to women fifty and older for over 20 years. I went on to explain that she needs to embrace a new demographic – even multiple demographics – across multiple channels in order to grow her business. I explained, “Continuing to do what made you successful in the past could put you out of business in the future.” She agreed with a sigh and I am now working with her to create an online strategy to expand her customer base, and increase her revenue.

The moral of the story here is that change is difficult and stressful, but if you don’t embrace change, you will ultimately become irrelevant.

We can see this phenomenon with even the largest, most successful corporations. Microsoft recently announced that Satya Nadella will be their new CEO. Nadella is a 22-year Microsoft veteran with no experience running a company as complex as this one. I have my doubts that he will be able to revive Microsoft’s once exciting customer-focused strategy, much less execute on it. This was a highly conservative and safe choice. Nadella is a Microsoft insider, and it’s reasonable to assume he will continue to do things the “Microsoft” way. The fact that Bill Gates is stepping down (ousted?) as Chairman to “take a more active role” supports this, in my opinion. Therein lies their ultimate path to irrelevance: Microsoft lost the tablet war before it even started, continues to lose desktop market share to Apple, and never got off the line with their mobile offerings.

In order to avoid irrelevance, Microsoft has to do something incredibly disruptive. What are you doing in your business efforts to remain relevant, grow, and flourish?


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