Change has the capacity to better a business or lead to its demise. When change is handled and managed carefully, overseen by a decisive and credible leader, success and continual growth will result.
Companies with leaders that recognise changing consumer demands or a shifting landscape within their industry are the ones that stand the test of time, and there are few that have survived. We looked at three of the most adaptable and progressive companies across the world and the leadership at their helms.
Founded in 1976 by Steve Jobs, Steve Wozniak and Ronald Wayne, Apple is a company that has seen tremendous growth over its time, and has done so in the face of significant challenges and changes.
Arguably, Apple’s greatest move came when it turned its attention away from computers and toward hand-held devices, and reinvented already existing devices. The iPod and iPhone, both launched in the 2000s, were not the first MP3 players or smartphones, but their revolutionary design turned the game on its head. Turning their attention to this business plan influenced the company’s success for years to come.
Most recently, in 2018, Apple’s VP of Environment, Policy and Social Initiative – Lisa Jackson – announced the company’s radical business model change. This change would include high environmental goals, with a desire to gain a sustainable competitive advantage over the next few years. Jackson explained that Apple’s goal is to design durable hardware and software that would last for years to come. The means of doing this lied in shifting from product production to a SaaS revenue model.
Apple’s latest shift in how they do business came during the pandemic, perhaps unsurprisingly, as it was a time when many businesses had to tackle necessary and challenging changes. Whilst many companies suffered with the enforced closure of physical stores and subsequent shift to online retail, Apple saw hardly any change to its revenue, generating a September quarter revenue of $64.7 billion in 2020.
Nintendo Co., Ltd.
The consumer electronics company Nintendo has been about since 1889, originally manufacturing and selling handmade playing cards. The leadership of the business was taken up by Hiroshi Yamauchi in 1963, grandson of founder Fusajiro Yamauchi, who began to shift and experiment with new business strategies. Yamauchi dabbled in a taxi company, a TV network, and then eventually settled on video gaming after the success of their ‘Donkey Kong’ idea.
The Japanese company is now one of the largest and most successful video game companies in the world and continues to see successes, with its more recent Switch console leading to an over 500% rise in annual profits in 2018.
The business continued to thrive across the late 20th century, despite strong competition from the likes of Xbox and Playstation. This might be all down to the innovation and perseverance of Nintendo’s leadership. Yamauchi had the determination and backing from employees and investors to experiment with strategy, something which has clearly paid off.
Yamauchi still influences the company’s direction today, even years after his resignation. His main philosophy centred around creating value through content no other company offered. Despite confessing to have no interest and understanding of video games, Yamauchi’s leadership allowed Nintendo to dominate the business.
Netflix began as an online-enabled DVD rental-by-mail business that used a monthly subscription model instead of a single-rental model that was typical amongst most video rental stores at the time. The company has grown into a world leading internet entertainment subscription streaming service, with over 100 million users in over 90 countries.
Founded by Reed Hastings and Marc Randolph in 1997, Netflix has continued to change and adapt its business models and strategies as a result of external and internal factors ever since its startup. Hastings dubbed the company name ‘Netflix’ because, even back in its founding in the late 1990s, he hoped it would be offering DVD rentals by means of an online streaming service – he wanted to name it after what would one day be its eventual fate. This is an innovative and somewhat avant-garde approach to leadership, and an example of how a boss can garner the trust and confidence of their employees in an idea that is yet to be feasible.
There have been several significant changes to the company over the years – in 1999 with Netflix’s change from a pay-for-use model into a subscription model. Then again in 2007, it saw significant progression into online streaming, making use of the change in available technology and consumer wants. And finally in the early 2010s, when the company started investing in producing their own original content.
Hastings’ decision to change direction and push Netflix towards being an online streaming service testifies to his open-mindedness and drive. In 2007, no one knew the capacity the web would end up having, but Hastings stuck with his vision and did so with enough conviction that his employees trusted and followed in the journey.
Netflix rewards employees for results. By focusing on building the best team – through having the best talent – they have been able to adapt and evolve as a company. The company’s management realised the importance of having a tenacious and functioning team that can handle change well and help see the company through.
Netflix is a true example of stimulating change and adapt to it, it is a company that has achieved a competitive advantage by changing its business model to fulfil customer demand.