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I read recently about a board director who said that her leadership team was “paralysed by the seemingly endless possibilities” of the future. I guess they are not alone and if we are all honest with ourselves, I am sure we are all the same.
Change is occurring simultaneously, accelerating quickly, and creating so much complexity and uncertainty that even the savviest executives question whether they’re prepared for the revolution ahead.
In 2018 the number of UK businesses entering bankruptcy hit a four-year high, meaning one in every 213 companies fell into liquidation. It’s an unsettling statistic which exposes the reality of today’s turbulent business landscape. It is frightening to think about the numbers this year and into 2021.
Back when Henry Ford was manufacturing automobiles, he famously said, “Any customer can have a car painted any colour that he wants, so long as it’s black.” It was almost 40 more years before we began hearing “the customer is king.” We’ve spent the subsequent decades reorganising our businesses around our customers’ known wants and needs.
To avoid becoming just another statistic, business leaders must be bold but also measured in their strategies. Doing nothing ensures that the business remains stagnant while making the wrong investment can tear apart revenue projections and set the company back. One sure fire strategic approach is an investment in technology, but this has no guarantees.
Back in 2011 Microsoft acquired Skype for $8.5 billion and this purchase was going to make Microsoft a cool company with a brand that had become a verb. Microsoft unfortunately set about trying to make Skype compete with everyday communication apps, while sacrificing the thing that made it most useful: reliable video calling.
The new Skype they created was supposed to make it fresh and more appealing to the young winning over customers from WhatsApp. By focusing on various features, some borrowed from Snapchat they lost their way taking their eye off the ball of the core functionality; video call quality.
While all this was going on alternatives were quietly gaining ground, providing the same features for free while Skype stagnated and regressed. Companies like Zoom started to add relevant features and improving the quality of calls with less dropped lines.
Microsoft fought back with Teams, a product that was intended to take over Slake in the business sector. In September 2017 Microsoft announced that a business focused Teams would replace Skype in the business world. Fast forward to today and a different tale. Skype will disappear next year and anyone wanting to make a business video call using Microsoft will have to use Teams.
Back in 2017 the visionaries in Microsoft never saw a pandemic in 2020 in their plans which would result in Zoom becoming the poster child for video conferencing for all, not just the business world. The ability to connect without any difficulties and the ease of use has made Zoom a success while Skype has failed.
So is less than a decade Microsoft spent $8.5bn buying Skype that had the potential to become the biggest video conferencing app in human history and failed. They took a cool product and made it corporate and customers have voted with their feet.
As I said there are no guarantees in today’s world.
Gordon is the former president and chief executive of BMMI. He can be reached at [email protected]