Turning Market Disruptions into Strategic Growth
The pandemic has led us to ask many questions.
“Are we really more productive working from home?”
“If this is the future of work, how do we keep making sales and growing revenue?”
And mostly, “How are some businesses thriving right now when so many are struggling and failing? How are they turning barriers and disruptions into revenue growth, and how can we too?”
The answer is antifragility.
The conversation happening at most organizations right now is centered around pivoting strategy to make up for lost revenue in 2020. When this is the topic, the focus is on simply getting back to neutral – filling in the hole that the pandemic caused when it upset the market this year and hoping that next year will provide an easier opportunity for growth.
But what if these sweeping disruptions could be a catalyst for growth right now instead? What if the conversation were about how much your business could grow instead of whether it would survive?
Embracing an antifragility mindset allows an organization to thrive during chaos.
What is Antifragility?
Resiliency is the ability to resist failure. Robustness is the ability to recover from failure.
Antifragility, on the other hand, is the ability to thrive from failure.
The concept of antifragility was developed by Nassim Nicholas Taleb and explored in his book Antifragile: Things That Gain From Disorder. It has since been applied across numerous fields, most notably risk analysis, physics, molecular biology, engineering, transportation planning, and computer science. Taleb offers this definition on antifragility:
“Some things benefit from shocks; they thrive and grow when exposed to volatility, randomness, disorder, and stressors and love adventure, risk and uncertainty. Yet, in spite of the ubiquity of the phenomenon, there is no word for the exact opposite of fragile. Let us call it anti-fragile. Anti-fragility is beyond resilience or robustness. The resilient resists shocks and stays the same; the anti-fragile gets better."
Things that are antifragile require failure and chaos to survive and excel. People, plants, processes, and political systems can all be antifragile, and so can businesses.
So, how to you equip your business to flourish from stressors, shocks, volatility, distractions, mistakes, attacks, or failures?
Prepare for Nonlinear Events
Do not try to predict when market events are going to happen – just brace for the certainty that they will happen eventually. And when they do happen, resist fear and knee-jerk reactions. It is human nature to react to unexpected events with a fight or flight response. Reduce the likelihood of reacting rashly by planning for market disruptions so that when they do occur, they are no longer unexpected.
Understand that sometimes revenue growth is a series of two steps forward and one step back instead of a strictly linear series of events. Make a revenue plan that includes different market scenarios and stick to it to grow during adversity. Focus specifically on what you can control, like learning, listening, and automating, and let everything else fall into place.
Thinking differently is crucial. Dheeraj Pandey explains it best when he says,
“Being on a treadmill and running faster than ever with old habits in a time of crisis might seem like showing grit. What's harder to do is to step aside from the treadmill and think differently.”
Too many companies approach strategic revenue planning with a robustness and resiliency-focused approach, but these reactive mindsets do little to capitalize on market dips and disruptions. Do not plan for how you will react to market events. Instead, plan for how you will structure your business and its operations now to capitalize on disorder when it occurs.
Taleb conjectures that the business world has moved towards suppressing randomness and volatility but doing so has opened businesses up to more damage when significant market events occur. He explains that this is counter to the true nature of the world because we are designed to be antifragile – to rebound from failures and fuel them to make us stronger. Gassia Gerges agrees with this concept. In her inspiring story of how she overcame her upbringing in a warzone to start one of the fastest growing tech companies in America she says,
“When people don't want suffering in their lives, I'm like, ‘You're eliminating the greatest gift that can happen to you.’ We go to the gym, and what do we do to our muscles? We break them down to make them stronger. Strength in character, too, can't happen without suffering.”
It is logical then to assume that turning our businesses into antifragile entities is a natural extension of our true selves. We just need to embrace it as a strategic approach, which is not always easy when antifragility includes a willingness to make mistakes.
Act without Fearing Mistakes
Regarding mistakes Taleb explains,
“The antifragile loves randomness and uncertainty, which also means— crucially—a love of errors, a certain class of errors. Antifragility has a singular property of allowing us to deal with the unknown, to do things without understanding them— and do them well. Let me be more aggressive: we are largely better at doing than we are at thinking, thanks to antifragility.”
So often we tout the benefits of thinking and then acting but there is no substitute for action when it comes to growing revenue during times of turmoil. Turning disruptions and chaos into growth requires us to put the “measure twice, cut once” approach away and just start cutting.
Perfectionists and planners will ask, “Won’t mistakes occur if we just do without thinking it all through?” Of course, they will. However, antifragility requires that we allow the company (and ourselves) to make mistakes and learn from them. Always keep business goals fluid as you navigate disruptions to leave room for shifting opportunities and priorities.
Out of mistakes can come incredible success. In fact, some of today’s most recognizable products were mistakes. Everything from Wheaties to sticky notes got their start in error. History is on our side – we know that businesses and entire industries have been born out of deviating from the routine in both times of stability and times of chaos. Therefore, we cannot simply just keep doing what has worked before and assume that it will always work even as disruptions occur.
Hold onto Redundancies
Streamlining operations creates greater efficiencies and may improve revenue generation right now and getting leaner may make you better able to respond to failures quickly, but it rarely helps you to grow from them. Optimization may indeed become your enemy when huge disruptions occur. Because you cannot predict the extent or duration of a disruption, resist the pressure to optimize all your operations. Instead, build in redundancies so that backups are there to fall back on when needed. These redundancies will have a carrying cost, but often their benefits will outweigh these costs when business operations need to pivot quickly during a crisis.
Have backups for things (equipment, raw materials, shipping carriers, and so on) and people. Maintain the kind of business relationships that you can call on when things go haywire and your business needs to go outside of its usual routine. These connections are invaluable during a crisis.
Value Your Reputation
Act like a business that needs financing even if it does not. Look at your company the way someone else would when analyzing it for lending potential or as a possible investment opportunity. Do not do this unscrupulously by fixing the books or lying about revenue generation. Rather, look at your business through the lens of third-party observers to answer the questions they would ask. Convey both internally and externally that the business has a plan and has already begun implementing it. Do not act like a business that is in trouble. Instead, act like a business that is ready to pounce – one that is poised to lead the industry, not just avoid landing at the bottom.
Download the Revenue Development Action Plan today to get advice on how to strategically grow your revenue with an antifragile approach.