Why it’s (long past) time for Canadian Enterprises to do business differently.
In some notable ways, Canada has changed:
- Recreational cannabis is a legal (multi-billion dollar) industry.
- Basketball is more popular than hockey.
- Lululemon is the official outfitter for Team Canada.
However, when it comes to the way we do business, Canadian Enterprises have lagged far behind their international peers for many years.
Canada’s long-standing “conservative” business culture does not suit a fast-paced, modern-day economy:
- Canada faces significant competition: We import more goods than we export and struggle to scale firms that can compete globally with only 13 Canadian firms included on the Fortune 500 list in 2020.
- Business performance is far more volatile today than it was in the mid-20th century: Industry-leaders are half as likely to hold their position five years later and no-longer are above-average returns now correlated with above-average returns in the future.
- Major crises throughout history have accelerated attitudinal shifts such as women’s participation in the workforce following WWII. The covid-19 pandemic has already altered Canadians’ attitudes about where they want to live and how they want to work – and it’s not over yet.
It’s (long past) time for Canadian Enterprises to modernize the way they do business.
In a predictable mid-century operating environment (that produced the field of business management) the objective of traditional business strategy was to establish a clever market position.
In a “change-is-the-only-constant” operating environment, the objective of modern day business strategy must be to establish a clever learning position.
A ‘learning position’ is the means or lens through which an enterprise systematically identifies (and capitalizes on) early signals of change.
Every single player today (large, mid-size and small) has to contend with an accelerated pace of market and economic change. The player that learns of big changes sooner has the advantage.
Since the success of an enterprise depends on its ability to satisfy customers, a learning position that systematically identifies signals of change within its customer base (such as a shift in attitude from a high-growth market or strategic industry vertical) will offer that enterprise greater strategic advantage than any other.
In our first blog we explained that Customer Strategy is the process of making business decisions based on a deep understanding of customers.
Essentially, when an enterprise embraces Customer Strategy, it assumes a customer-oriented learning position.
Such an enterprise invests time, money and effort to understand its customers better than its otherwise equally-capable competitors. This enterprise then launches new services to address identified needs or changes the way it interacts with customers to address shifting preferences.
Ultimately, by making business decisions based on early signals of customer change, this modern-day enterprise differentiates itself in ways that create value for customers. And when an enterprise (preferably a Canadian one) creates value for customers, it captures value for itself.
Customer Strategy is what we do at New Territory.
So it should come as no surprise that we recommend every Canadian Enterprise adopt a customer-oriented learning position in order to sustain business performance in a volatile operating environment.
In fact, we believe it will become every growth-minded leader’s new favourite position.