Embrace and Pivot
An encounter with change doesn’t have to a be jarring. In fact, every time you encounter change you should embrace it, just like an old friend. After all, change brought you up and will soon bring you down, and back up again. Get used to change, because your relationship with this unstable bastard will persist until the day you die. At least be friendly!
Embracing change doesn’t mean accepting every new style or trend at face value, or even adopting change at all. It’s much simpler than that: if there’s a new idea or insight that challenges you to change, assess whether or not it’s valuable. We want to change the world around us for the better, and all we could ever ask for is a chance to do it. Let the ideas that threaten to change your world run their course and see if they make sense.
This requires a certain level of open mindedness. You cannot refuse to look at an idea objectively and expect to learn at the same time. You have to be willing to ask yourself, and seriously answer: what if I’m completely wrong about this? This is embracing change: it doesn’t mean you have to stick with it in the long run, but you cannot neglect it. If, after thorough consideration, an idea still doesn’t make sense (or it is in some way flawed), then you can resolve it yourself and abandon it. The important part is to consider it in the first place. Have an open mind to the things that may prove you wrong.
It’s only human nature: confirmation bias aims to make our perception of reality consistent with what we already believe rather than what is true. It’s not fun to think about being incorrect, yet that is exactly what we must do when faced with change. What if we are wrong? We must objectively experiment with whether or not a new thing can be valuable, rather than twist the evidence to say that we are already on the right path.
Without embracing and pivoting, at one point you will fall behind and it will result in the failure of you, your company, your relationships, or anything else that you choose to neglect because you are simply stubborn or slow to act. In 2004, Blockbuster Entertainment Inc. had over 9,000 physical retail locations where customers went to rent movies that played on physical discs. Blockbuster was at its peak, and though it may seem hard to believe or remember, instant streaming of television and movies wasn’t the way of life. As of 2018, there are nine Blockbuster locations in the United States. Blockbuster is gone, and it’s gone forever, forgotten in a changing world that ruthlessly left it behind. What happened to the multi-billion dollar conglomerate?
Meanwhile, in 2002 Reed Hastings had just taken his company, Netflix, public on the Nasdaq stock exchange. In 1997, Hastings had explored the idea of shipping discs through the postal system by mailing a CD to himself, which worked flawlessly when the disc showed up at his house without damage. Netflix soon began charging for a subscription-based service to have rental DVDs shipped directly to your home.
The real business story here is a story about change. See, Netflix was constantly focused on the disruptive change that was bound to happen sooner or later in the home video and entertainment industry, and when Hastings saw that there was a business in shipping DVDs rather than renting them from a physical location, he pounced and embraced the change. However, even he did not get it right the first time, or think that he would get it right the second time around at all. At first, Netflix was only shipping DVDs, but not through a subscription-based service. Hastings didn’t hesitate to embrace and pivot with the change to a subscription model early in the development of Netflix. Further, Hastings says that they specifically named the company Netflix (flicks from the [inter]net) in the early stages of the business because they already knew that DVDs were not the future, but that streaming services were. Before the change had even occurred, he already recognized that he must put the company in a position to make drastic changes to its business model.
From day one, Netflix and Hastings were focused on adapting to, and embracing, a rapidly changing landscape. Blockbuster, on the other hand, only first attempted to directly compete with Netflix’s service beginning in 2004, and would throw hundreds of millions of dollars at their attempt to compete with Netflix by delivering DVDs, but it was too little too late. Blockbuster would even use its massive resources to try their hand at a streaming service, but Netflix had already captured the eyes and ears of the American public. Unchanged Blockbuster was already old news. As of early 2018, Netflix trades at nearly $275 per share, and is showing no signs of slowing growth or impending doom. Blockbuster is dead because it couldn’t embrace and pivot with change.