There was a painful silence in the meeting room. The team of strategists I was facilitating had just realised, simultaneously and suddenly, that they had been making a mistake for some years.
I won’t share their secrets, but their mistake was to overlook a subtle but significant behaviour of their customers, a behaviour that strongly shaped brand preferences and that should have shaped their strategy. Their expensive, elaborate strategic planning process should have identified this behaviour and used it to guide their value proposition. But it hadn’t and the customers’ behavioural subtlety was buried in a mass of less-insightful quantitative data, which their systems were good at crunching. Downcast by this realisation, their leader asked the killer question: “We used to be good at this sort of thing. Why aren’t we now?” Trying to avoid pointing fingers, they turned to me for the answer, which was: “Because you’ve evolved this way.” When I explained what I meant, it helped them. So, let me share my explanation with you.
Growth changes us
Like most companies, my client had started small and tightly focused and had grown to be large and diversified across several sub- markets. Fifty years ago, a great researcher called Larry Greiner studied how, as a corollary of such growth, firms change their systems, structures and processes. If they don’t, they can’t cope with the implications of growth and they fail. Consequently, even though most firms still tell heart-warming war stories about the old days, today’s firm is almost always a different animal from the one its founders would recognise. It’s much too simplistic to think that the firm has become better or worse; it has just adapted to fit the current situation better. The same evolutionary pattern can be seen in individuals. Neither you nor I are the same person we were years ago. Your present self wouldn’t fare well in the past and vice versa. And these adaptive changes, whether in companies or individuals, are not usually continuous; we change in spurts. The transition points for companies, when they make significant, sudden changes, have become known as Greiner points. You can probably see analogous transitions in your own life, such as becoming a parent.
Crossing thresholds
For both companies and individuals, the practical significance of Greiner points is illustrated by parallels with evolutionary biology. As biological species evolve, they seem to cross thresholds that mark points of no return. This concept is now known as Dollo’s Law, after the 19th century Belgian palaeontologist who proposed it. It has recently been supported by a Fribourg university study of animals, such as whales, that evolved from terrestrial to aquatic. It seems that once a species’ evolution causes it to lose a complex trait, it is nearly impossible to regain it. And this, I explained to my crestfallen client, had happened to them. Their informal, largely qualitative way of understanding their market had evolved into a much more structured and mostly quantitative approach. This was a necessary adaptation to their larger size and more diverse markets, but that evolutionary process also caused them to lose some capabilities, especially with respect to understanding implicit customer behaviour.
You too
In my coaching and mentoring work with life sciences leaders, I see a comparable effect. The mentoring process involves asking a lot of challenging questions that are intended to make the mentees reconsider their assumptions. However, in some cases, they may choose to ‘double down’ rather than reflect. In the case of one recent mentee, he responded to every question by becoming adversarial. The conversation was beginning to feel like a hard- fought tennis rally, so I changed the subject and asked him to tell me a story about when he felt he had grown personally. His story describes his younger self as eager to learn and happy to shift deeply held assumptions. Somewhere in the last twenty years, as he had evolved into a senior executive, he had lost that valuable trait and was finding it hard to regain it.
Older and wiser
I always try to give my readers a practical implication, so let me head in that direction now. If, as I believe, Dollo’s Law applies to both companies and people, there’s not much point in trying to reverse that part of your evolution to regain an old capability that you need today. That phenotype withered because it didn’t suit today’s environment. My client can’t become informal again; my mentee needs to be more decisive than his 20-something self. But that doesn’t mean you can’t regain the required capability in other ways. I advised my clients to incorporate ethnographic studies into their market research process. I advised my mentee to work with some of his younger colleagues, not as their leader but as a co-worker, on a particular change management project. I’m happy to say that both pieces of advice were accepted and seem to be producing good results. Even if Dollo says you can’t de-evolve, you can still evolve in the direction you need to go.
