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Trends in business frameworks in 2019

Business frameworks are relatively new on the scene. Most originated in the latter decades of the 20th century. They are the products of consultants and academics who attempt to give direction to business uncertainty. These frameworks will be more important than ever in 2019. There is a strong chance that the boom years we have enjoyed since 2009 are coming to an end. Uncertainty will be greater than ever. We won’t be short of intelligence but we are likely to be starved of knowledge. We will look to the frameworks for insights and a way forward.

Here are three things to think about as we contemplate the year ahead:

1 Keeping asking “What business are we in?”

A company that has a limited view of the business it is in is in danger of extinction. Perhaps the most notable example in management literature is given by Theodore Levitt who said that buggy whip manufacturers should have seen themselves in the automotive industry. This would have enabled them to transition their businesses into manufacturers of fan belts and drive belts when the motor car took over from the horse-drawn carriage. Fifty years before Levitt shared his buggy whip example, Mary Parker Follett, the mother of modern management ideas, was expounding the same theory. One of her clients was in trouble. They defined their business in simplistic terms – they said “We produce window shades”. Mary Follett asked them to think about what business they really were in from the customers’ point of view and why people bought window shades. In an epiphany moment they said “We are in the light control and privacy business”. From this point the company was able to create ways to control light and privacy for windows and move back into profits.

2019 will see competitive pressures that are greater than ever and it will be necessary to obtain clarity on “What business are we in?”. Frameworks will help (take a look at Customer Value Proposition, Diffusion of Innovation, Maslow’s Hierarchy, Segmentation, Value Based Marketing).

2 Get a strategic vision

When Bill Gates started Microsoft with Paul Allen they had a vision. They dreamed of a world in which there would be a computer on every desk and in every home. And in that computer they dreamed they would own the operating system. This clear image was a key ingredient in their huge success. In a similar way John F Kennedy in 1961 stated a vision "Before this decade is out, of landing a man on the moon and returning him safely to the Earth". That strategic prescience was far more powerful than a waffly "We are going to be the world leader in space exploration".

Without a clear image of what we want to achieve, there is a danger we will never get there. Frameworks can help us develop a long-term vision (take a look at Customer Value Proposition, Disruptive Innovation, Mintzberg’s 5Ps, PEST, Product Life Cycle).

3 Don’t let short term problems drive out your long-term thinking

Meteorology was among the subjects I studied at university. I remember a professor telling us that there is a better than 50% chance that the weather tomorrow will be like the weather today. This astounded me but when you think about it, it is obvious. Trends go in the direction they are already going. At least this is the case most of the time. Forecasting trends was one of my responsibilities in my first employment many years ago. In those days there were clear long-term cycles that repeated every 5 years. Economic cycles have lost their predictability. We are in a cycle of growth right now that has lasted 9 years. It can’t and won’t go on.

In 2019 there are sure to be plenty of short term problems. There is nothing new in that. Every year brings its crises. Keep in mind that long range planning is just as important as short-term profits for otherwise we are in danger of a long term decline. In 2019 we will need frameworks that help us deal with immediate crises (take a look at Benchmarking, Brand Audit, Gap Analysis, McKinsey 7s, Net Promoter Score, SWOT, USP ). But don't forget those that help plan for the longer term (take a look at ADL Matrix, Blue Ocean Strategy, Boston Consulting Group Matrix, Mintzberg’s 5Ps, Porter’s 5 Forces, Porter’s Generic Strategies, Product Life Cycle, Stage Gate New Product Development ).

So, as this new year begins, three things to think about are:

1 Keeping asking yourself “What business are we in?”

2 Get yourself a strategic vision

3 Don’t let short term problems drive out your long-term thinking

And keep using the frameworks!

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