By Rasmus Ankersen, founder and owner of RFA Performance & Research
In 1997, 20-year Tiger Woods had just won the Masters by twelve strokes, and he took a decision that would shock the golf world. He decided to reinvent his swing. We’re not talking about the endless tweaks and minor revisions that all players are forever making to their swings. We are talking instead about the conscious decision to undergo a structural overhaul, wherein a player transforms the very shape and pattern of his swing.
People thought he was crazy. Why would you break something that isn’t broken? Why take such a big risk when you are the best player in the world? But Tiger knew his swing wasn’t as consistent, controlled, or efficient as it could be. As he said: “Winning is not always the barometer of getting better.”
It took eighteen months of rewiring, practice, and frustration. Slowly Tiger’s new swing became a deadly weapon. With no loss of power, he could hit any type of shot on demand, better and more accurately than ever. The payoff was a record six straight wins starting in late 1999. The reinvention was a success!
Lots of businesses fail because they lack this courage to reinvent themselves. Blockbuster is a great example. Their crisis that led to bankruptcy was not caused by lack of resources, money or technology. It was caused by lack of courage. Let me explain…
In the late 90’ies Blockbuster collected more than $800 million in late fees (the fee you have to pay when bringing back a movie too late). It was a cash cow – until a guy called Reed Hastings, the founder of Netflix, created a business model that allowed customers to pay a flat monthly fee and rent as many movies as they wanted – with no late fees.
Reed Hasting’s idea left Blockbuster with two choices. They could challenge Netflix, or ignore them. They chose the last option, because copying or challenging Netflix would mean saying goodbye to the $800 million in late fees. Not really what the stock market would enjoy to see. It gave Netflix time to improve and grow – and suddenly it was too late for Blockbuster. Their unwillingness to destroy themselves and reinvent killed them in the end.
So what’s the point?
All successful companies are built on a business model they can successfully repeat – until somebody comes up with a better model. In order to survive this threat successful businesses have two choices: destroy yourself or wait to be destroyed. Unfortunately lots of businesses end up being destroyed because they – like Blockbuster – become obsessed protecting what they have and develop a psychological attachment to what worked in the past.
Here is my question to you:
Do you have the courage to destroy yourself like Tiger Woods? Do you have the guts to consciously decide to change things, which don’t look like they need to be changed? Or do you hesitate and wait to be destroyed?
Change shouldn’t happen when it is necessary. It should happen when it is possible.
Categories: Business/Finance Tips