The Secret to Business Staying Power: A Strong Identity
By: David Shechtman & Terry Anderson
Roughly twenty-five years ago, Arie de Geus authored a book called The Living Company: Habits for Survival in a Turbulent Environment. The book describes a project aimed at understanding how companies endure past a person's life. Said another way, how do companies live longer than 80 years? Meaning they’ve made it through financial shocks, wars, pandemics, political instability, technological disruptions, and even self-inflicted scandals. How do they last?
Some of the companies de Geus researched experienced serious and significant changes to what they did. A few of the organizations, 700+ years old, do work now that wasn’t even possible at the time of their inception. In one example, Stora, a Swedish company, started as a copper mine and now produces paper, pulp, and chemicals.
But, what hasn’t changed for these organizations is their sense of identity, their purpose, and their reason for existence. Stora does work now that doesn’t even resemble the work at their outset, but the reason they do work and the approach they take to their efforts remain consistent.
Companies that consistently thrive over time don’t throw away their identity when times change. Rather, they embrace who they are and find new ways of expressing it!
Companies that give up who they are in changing times almost inevitably struggle. They are distracted by too many opportunities and make confusing choices. Apple is a prime example of this. In 1997, just before Steve Jobs' return, the company struggled. It had lost its competitive edge by trying to compete across multiple product verticals. Jobs boldly decided to restore Apple's identity as a company that prioritized innovation. He abandoned multiple lines of business and focused on a few key ones. This controversial move ultimately proved successful in restoring Apple's position as a leader in the tech industry.
Consider the current environment. Established companies and startups see their business reality constantly shift—as wave after wave of black-swan events impact their strategy, leadership, and operations. Boards and executive teams can take very little for granted regarding geopolitical, economic, technological, and climate dimensions. Endurance today means that even industry disruptors need to endure near-constant environmental shocks.
At Evolution, we believe that now is the time for companies to clarify their identity. The rapidly changing business environment demands it. The more the world changes, the greater the need for organizations to know who they are. In order to navigate through disruptive change, leaders need to know what about their company will change and what won’t.
Therefore, the best work that leaders and leadership teams can do right now is to clearly affirm who they are and what they stand for. And perhaps paradoxically, this understanding and focus will help rather than hurt the process of adaptability.
Chasing trends doesn’t work.
A clear company identity enhances adaptability to new circumstances and to do so in a strong, resilient, and sustainable way.
Practically speaking, we see an acute need for this identity work when companies face the following issues:
Merger or Integration
Whether born of opportunity or necessity, organizations coming together signal a new beginning. Capturing the hearts and minds of your employees, customers, and investors requires expedient yet thoughtful planning and communication.
C-Suite Transition
An opportunity to galvanize an executive team around a new leader and way of being. Ultimately, harnessing a period of transition to bring forth clarity, alignment, and focus on a cohesive and aligned path forward.
Funding Rounds…Or Not
Successive, successful rounds signal momentum and greater scrutiny. A fresh infusion of resources requires thoughtful, clear planning, and execution to capture an organization’s growing opportunity.
Those choosing to pivot from a conventional funding path to a “raise less, build more” approach require a tight balance between innovation and discipline to be able to build companies on their own terms
Public Company Readiness
A time when your vision, strategy, and culture will require clarity and alignment like never before. An opportunity to make the implicit explicit and prepare your organization for what’s to come.
Restructuring
A moment where meaningful change is required, involving tough decisions that impact the culture of the organization and its trajectory. Often overlooked, this is a time for deep introspection and bold moves to make meaningful decisions based on new realities and opportunities.
Here are some questions for you and your leadership team to consider.
What is the essence of our organization? What about us? If we were to give it up, would it fundamentally change who we are and what we do?
What do we stand for as an organization? What are our first principles?
What organizational behaviors reinforce our essence, and which ones undermine it?
What is the contribution our organization makes internally to our employees and associates and externally to our clients, customers, and stakeholders? How do we add value to all of these constituencies?
The answers to these questions may determine, more than any other single factor, how well your team succeeds this year and beyond.
Understanding an organization's core identity isn't just about adapting to changes; it's about tapping into the foundational essence that ensures enduring success in turbulent times. Contact our team HERE to explore the meaning of this work for your organization and discover how we can guide you toward clarity, resilience, and genuine purpose.