"Human history is, in essence, a history of ideas."
--H. G. Wells
Geologists estimate that 3,200 miles beneath our feet lies a "Solid Inner Core" of the Earth made up
of iron whose diameter is 70% the size of the moon. (Red)
There are three other layers of the
Earth:
-A "Liquid Outer Core" the size of Mars. (Gold)
-A "Mantle" 1,800 miles thick composed of different kinds of rock making up 84% of the Earth's total volume. (Olive)
-The layer closest to the surface is called the "Crust," also composed of rock representing 1% of the Earth's volume. (Gray)
If you cut the Earth in half, like an apple, you would see the solid Inner Core, Liquid Outer Core, mantle, and Crust.
With a surface as hot as the sun, the Solid Inner Core is a source of creativity, energy, and selective destruction. Spinning faster than the Earth itself, it leads, not follows, even though it is hidden from view.
What's a core idea?
Big and small organizations that consistently accomplish their aims do so with a simple idea that shapes and drives the enterprise.
Take UPS, for example.
Founded in 1907 as American Messenger Company by two teenage boys, James Casey, and Claude Ryan, with a $100 loan, the business prospered by providing the best service at the lowest rates. Because cars were scarce, reliable and courteous teenagers were hired to deliver telegraph messages, pharmacy orders, and groceries to homes around the Seattle, Washington, area on foot and bicycles.
That was the core idea.
More than a century later, Atlanta-based UPS partnered with FEDEX in the U.S. to ship 2.9 million doses of the Pfizer-BioNTech vaccine to mitigate against COVID-19. That may have been the most critical pharmacy delivery of all time.
As it lives and breathes
Clarity on a business or nonprofit concept comes from a critical mass of employees making the idea come alive. Those same individuals are also stewards of the organization's spirit and aspirations. Having "culture carriers" throughout the system is an informal way of socializing new associates and advancing institutional knowledge.
Trusted individuals who lead by example often produce better HR outcomes than formal mentoring and development programs. Healthy working relationships, clear expectations, and comprehensible goals also underpin the successful execution of strategy.
The research also notes that the core and identity have an interdependent relationship. Combined, they are central and enduring, distinguishing the enterprise from its peers. (Albert and Whetten, 1985) For identity to be clear, the core must be clear, especially as it is reinterpreted and reimagined for an emerging workplace and world.
It's the serious qualities of a firm, such as wisdom and good judgment, that resist bad change and accept good change. Anything goes wrong if there is an absence of honesty and moral courage in an organization's leadership.
Rethinking the core
"... no humanly constructed core idea or business endures forever in its original form."
The data in consulting libraries show that organizations often fail to take advantage of the full potential of their primary business. If you do not get enough of what it already makes, the next move is to abandon the core and chase after someone else's ideas.
Eventually, someone holds up a mirror and discovers those borrowed ideas don't fit. Management only sees the error of its ways in retrospect. Unfortunately, it's too late for some, while others are fortunate to get another chance.
Writing in Scientific American, Claude J. Allgre and Stephen H. Schneider remind us that the Earth and its atmosphere are continuously altered. "Plate tectonics shift the continents, raise mountains, and move the ocean floor. Constant change has characterized Earth since its beginning some 4.5 billion years ago."
Similarly, no humanly constructed core idea or business endures forever in its original form.
Why?
Over time, the assumptions on which the organization has been built (environment, mission, capabilities) and is being run no longer fit reality. ("Theory of the Business" by Peter F. Drucker)
As a management practice, UPS periodically updated its assumptions, building on a stable core with a disruptive edge. From bicycles to drones and back to bicycles. Delivering messages to managing sophisticated supply chains. Over 5,000 independently owned UPS Stores are franchised by the corporate parent in the U.S., Puerto Rico, and Canada.
The company has existed for 114 years but has resisted the aging process by maintaining its original values of reliability, high ethical standards, and close customer relationships.
Is this a good time to revisit your assumptions and where the core business should go?
Management writer Dr. Chris Zook, who studies core structures, offers strategic questions--
1. How do you know when your core needs to change in some fundamental way?
2. How do you determine what the new core should be?
3. How do you measure the vitality that remains--is the energy exhausted, or does it still have legs?
4. How profitable are your customers, and how loyal are you?
Remaking commerce
Makeovers have a high failure rate —some say as high as 70% (McKinsey & Company)—because businesses tend to travel great distances seeking success in unfamiliar territory (Microsoft and Nokia). Those in the 30% who succeed stay close to home (Disney and Pixar).
What do they discover?
Hidden assets.
"The real question," says Dr. Zook, "is how to open management's eyes to the hidden assets in its market. How to mine the treasure that's within their reach."
Planning ahead
Coronavirus is doing something to your employees and customers. The full impact remains to be seen. In the meantime, here are additional questions to consider as you think about the future--
o What's your core idea and business?
o What's worth keeping in the core?
o What needs changing or remaking?
o Are current customers aging out?
o Where will you find new customers?
Strategist.com
© Bredholt & Co.
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