SURVIVAL OF THE FITTEST

A Message from Senator Angus King

“SURVIVAL OF THE FITTEST” is one of the most quoted — and misunderstood — statements in our lexicon. Most people think Darwin’s famous shorthand description of evolution refers to those who will win as the biggest and the strongest, those with the longest teeth or most aggressive nature. But if this were true, the dinosaurs would still be in charge and we would be a footnote in evolutionary history (“Delicious while they lasted,” said Mr. T. Rex).

What Darwin meant, however, is quite different and applies to all facets of our lives. For him, the “fittest” were those most adaptable to change. And this is particularly applicable today as we live through the most rapid period of change in human history. The transition from hunter-gatherers to settled agriculture took hundreds of thousands of years. The transition from an agriculture-based society to industry took hundreds of years — in 1820, over 90% of Americans were engaged in agriculture, today, it’s 4%. The transition from a manufacturing economy to services took decades, and the transition to a digital economy is taking place before our eyes in a matter of years, if not months.

What does this have to do with business? Everything. Failure to adapt to changing markets, changing consumer tastes, or changing modes of commerce is a recipe for decline and ultimate extinction (to use a term Darwin would certainly understand). Another word for this imperative is innovation, which comes from the Latin word novus, meaning, not surprisingly, new. To put it most simply, in today’s world, a failure to continuously innovate means eventual institutional death. I emphasize “continuously” because today’s brilliant innovation soon becomes old news, so renewal should be looked upon as a process, not an event.

The business landscape is littered with the carcasses of once-great brands — American Motors, K-Mart, TWA, Polaroid, Kodak, (almost) Sears, and more recently, Circuit City, Blockbuster, AOL, Wang, Alta Vista, and (almost) Blackberry. The causes of their demise were many and varied, but a failure to adapt to changing markets and the innovations of others was certainly part of the sad story.

On the other side of the ledger, of course, are companies that were nimble and flexible enough to glimpse the future and embrace inevitable change rather than resist it. One of the best national examples of this is Verizon. Originally part of the old monopoly-based landline telephone system — New England Tel, Bell Atlantic, then Nynex, in the mid-nineties their leadership anticipated the revolution wrought by ubiquitous mobile phones and began to shed the legacy landline business and plunged headlong into mobile. From there, they moved on to internet services and streaming TV. Remember, innovation is a process, and to survive, it can never stop.

My all-time favorite example of this principle, however, is Hussey Manufacturing of North Berwick, Maine. Founded in 1835, the company’s original product was plows. That’s right, like for plowing a field. And it was an innovative plow design that was both effective and durable. After a devastating fire in 1895, however, the grandsons of the founder decided they had to diversify and turned to shaping steel (as they had done for plows) into fire escapes and bridge supports, new products for the industrial age.

Then, in 1931, Phillip Hussey developed a new design for portable seating for sporting events which evolved into the foldable bleachers we all remember from our high school gyms. This entry into the school market took off when the baby boomers entered elementary school which foretold an explosion of school construction across the country throughout the fifties. From there they continued to innovate — telescopic seating, which allowed civic centers to easily convert from seating to open floor space, fold-down chairs in auditoriums, polymer stadium seats, upholstered seats, and continuously evolving seating options for stadiums around the world.

I wonder where they’d be today if they had stuck to plows?

There is no formula for innovation, but there are some organizational characteristics that can encourage and support it. Here’s my list:

1. LEADERSHIP WITH IMAGINATION. Don’t ask why, ask why not.

2. LEADERSHIP THAT TOLERATES—INDEED ENCOURAGES—IDEAS FROM WHATEVER SOURCE. Any manager who says, “We’ve never done it that way before” more than three times in a year should be fired.

3. LEADERSHIP THAT KEEPS A SHARP IDEA ON BOTH THE MARKET AND THE COMPETITION. Sometimes you have to imitate someone else’s innovation just to keep up.

4. LEADERSHIP THAT IS PREPARED TO TAKE RISKS. Imagine being at that meeting at Bell Atlantic when someone said, “Why don’t we get rid of those monopoly wireline systems that generate huge amounts of dependable cash every month and go all the way into this new mobile phone thing”. Now imagine saying yes.

5. LEADERSHIP THAT MAKES INNOVATION A CORE COMPETENCY OF THE BUSINESS. Whether it’s a fully-funded R&D shop or just assigning specific staff to look out for new ideas, the successful business will deliberately develop a culture that values and nurtures innovation. The key word here is “deliberately.” It may occasionally occur by accident, but there’s no substitute for consciously creating the structure that makes it more likely that new ideas will rise to the top.

6. LEADERSHIP THAT LISTENS TO THEIR KIDS. They are the future customers and their tastes and desires will shape the market.

7. LEADERSHIP ITSELF. Be an active and engaged leader — don’t be satisfied with just keeping the doors open. Assemble a great team and empower them to think for themselves and to never be afraid to tell you the truth. My favorite leadership motto is one that has worked for me for thirty years, “Hire good people and take credit for what they do.”

But the most important thing is to realize that innovation is not an option or a nice-to-have, it is an imperative, and that even the most traditional and (apparently) stable business faces disruptive risk every day. What you want, of course, is to be the disrupter, not the disrupted.

Maybe the best way to sum all this up is the old African proverb—

“EACH MORNING ON THE PLAINS OF AFRICA, A GAZELLE AWAKENS

AND KNOWS THAT IF IT CANNOT OUTRUN THE FASTEST LION, IT WILL BE KILLED. AT THE SAME TIME, THE LION AWAKENS AND

KNOWS THAT IF IT CANNOT OUTRUN THE SLOWEST GAZELLE, IT WILL STARVE. SO IT DOESN’T MATTER WHETHER YOU’RE A LION OR A GAZELLE; WHEN THE SUN COMES UP, START RUNNING.”