What do Kodak, Nokia, Xerox, Blackberry, MySpace, PanAm, Blockbuster and Borders all have in common?
They were all dominant market leaders that failed to adapt to change and went bust (or were reduced to almost nothing).
In a paraphrase of Charles Darwin, author and professor Leon C. Megginson summarised: “It is not the strongest of the species that survives, nor the most intelligent, but the one most responsive to change”
Yesterday, the Financial Times reported that 28 of the world’s largest banks have still not signed up to a climate change initiative that encourages businesses (all businesses) to disclose the risks that global warming poses to them.
The banking sector is important in this initiative as it finances activities that contribute to warming, it lends to companies whose business models may fail as a result of warming, and extreme flooding may severely impact the recoverability of their own mortgage books.
Change always brings risk, whatever the change, and so the risks around change have to be understood in order that they can be managed. This is true both for change that is instigated internally by an organisation such as a major project, and for external change that an organisation may not be able to avoid, such as legal and regulatory change, social and economic change, technology change, political change, and most significantly of all, climate change.
Data Sources: Google, The Financial Times, “This Changes Everything” – Naomi Klein