Pop quiz: Q: How many companies on the Forbes 100
list 25 years ago (1978) are still there today? (Forbes ranks firms
by market cap; Fortune ranks them by revenue.)
A: 32, or an attrition rate of 68%. (35 were taken
over, 30 dropped out of the top 100, and 3 went broke.) The common
theme tying together the ranks of the fallen is a failure to adapt.
If you think that means you cannot relax, you are more than approximately
right. Why precisely do firms fail to adapt? According
to this Boston Consulting Group piece, "Leadership in a Time of Creative
Destruction," some simply misperceive the threat: Motorola
owned analog cellphones but never saw digital coming, and Sony was the
gold standard of tube TV’s but missed flat panels.
Another set of firms sees the threat and wants to respond but is intrinsically
incapable of adapting: Kmart in retailing, virtually the entire
US steel industry.
Lastly, we have the interesting cases: Those who see the threat
and have the resources (financial and intellectual) to respond, but who
cannot bring themselves to change–they just lack the stomach for it. Now,
it’s a truism that lawyers are not exactly known for embracing change,
but like most truisms it’s decidedly unhelpful (meaning it provides no
guide to action).
So if your firm is facing the need for change—be it as "small"
as rejiggering your practice group lineup or as large as finally at long
last embracing the collaborative mindset needed to undergird a KM effort—what’s
to be done? Start by realizing the good news about lawyers’ notorious
resistance to command and control environments: People who care
more about "meritocracy, autonomy, self-expression, self-improvement,
and mobility" actually find it easier to adapt
than previous generations (warning: stereotype ahead) of grey-flannel
suited conformists determined to keep their heads down. But, as
Peter Drucker has said, it’s like "managing volunteers."
Put into practice, this means you as firm chair or leader need to be
prepared to listen to the smart iconoclasts—not all of them are
right (but neither, necessarily, is the conventional wisdom) but a few
of them are not wrong. Hard to separate the wheat from the chaff? Tough;
that’s your job. You need to strike that fine balance between drowning
in distractions and being intellectually open to the notion that business
as usual may not make for prosperous year-end’s indefinitely. And
once you’ve separated the signal from the noise, your #1 job is to communicate,
communicate, communicate. Explain the problem, harp on its urgency,
inspire with your vision of an alternative future that dodges this bullet,
and do it again, and again. So:
- Listen to everyone, not just those who tell you what you want to
hear. - Decide what’s a genuine risk and what’s merely cyclical or distracting.
- Formulate a vision.
- Communicate.
Most of all, stand firm. As BCG puts it, "most organizations will
do everything humanly possible to avoid stress, [and] they have developed
an extended repertoire of avoidance behaviors." Your job is
to achieve, and insist on, clarity.
