Peter Drucker famously wrote “innovate or die.” Firms that do not look to the future while leading the present are very likely to slide into obsolescence. In our practice, we have our share of clients that are leaders in their space, yet look to us for strategic guidance and insights even when they are “killing it.”
Unfortunately, there are those too who we would call arrogant cultures, who believe that the well will always be plentiful, only to realize later that their failure to plan for the future has left them with little chance to recover.
The Deloitte Way
An excellent example of a firm that is highly respected and a leader in its space is Deloitte Consulting. While it is one of the most sought-after firms in traditional management consulting, it continues to look for ways to reinvent itself and stay ahead of the curve.
During the Covid-19 pandemic, the firm began to use a mix of subcontractors to complete projects – a concern to many partners that Deloitte’s brand and work quality would suffer (not to mention its full-time consultants would look wildly expensive). However, the firm, following its own philosophy of advising clients on stretch strategies, found that the market was moving in this direction and has been able to maintain its pristine image and position.
Arrogance Will Slowly Destroy a Company
There are those too, however, who believe that by showing any sort of business challenge in a forum of colleagues, trade shows or conferences is a form of weakness. Instead of pointing out, for example, that Covid-19 shut down consumer spending, distribution and manufacturing, we saw “arrogant” firms communicate business was “booming” and “never been better” only to realize later their culture had been lying to itself.
Professor Clayton Christensen, one of the world’s foremost authority on innovation has established that “disruptive innovations originate in low-end or new-market footholds”. This is where arrogance comes into play. Arrogance acts as a reality distortion field that prevents incumbents from taking serious threats arising from those “unworthy” markets. Until it is too late.
For more examples, see Kodak, Blackberry, Microsoft, Blockbuster: Cases in which a culture of arrogance, usually at the top-level of a company, led to poor strategic decisions and decline of large corporations.
Reducing Cultural Arrogance
While this is not an overnight solution to reducing cultural arrogance and becoming a learning organization, there are steps firms can take to get there. Here are a few ideas that Foodservice IP recommends:
Foster Employee Education: Provide access to management and industry-specific books and podcasts. Open their minds. Make it easy for employees to learn and stretch their ideas.
Schedule Case Study Presentations: Select one or two employees a month to use a Harvard Business Review or MIT case study to present to your teams during a lunch or even Zoom session. Come up with the same questions instructors would and ask staff how they would handle the dilemma.
Foster A Culture of Trust: Right now, we are talking to our senior managers. If senior managers don’t trust their staff, then middle managers will follow suit and micro-manage their staff. This leads to work stress and fear, not a forum conducive to innovation and ideas.
Get Outside Help: Yes, we are pitching ourselves and other firms here. Many of our clients fall into a “group think” pattern, and a third-party can help a firm navigate out of what seems like a loop of complacency. New ideas and strategies are built on evidence-based insights.
Lose the Ego: So your company is going great guns right now? Great! What happens when buyers, competitors, suppliers, substitutes and unforeseen environmental issues hit? What contingencies do you have? It’s better to plan when the going is good than to scrape by for help when it’s too late.
Firms have the opportunity to remain relevant if they are willing to acknowledge uncertainty and retain some humility. After all, if a firm like Deloitte can look at itself and acknowledge its vulnerabilities when it is on top of its game, then any firm can.
Tim Powell is a Managing Principal of Foodservice IP. Tim serves as a trusted foodservice adviser to management at several food companies. To learn more about FSIP’s Management Consulting Practice, click here.
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