Here’s my second follow up entry to my “Built to Collapse” post in which I look at the parallels between society and business collapse – inspired by Jared Diamond’s “Collapse – How Societies Choose to Fail or Succeed”.
While there is plenty of concern today about global warming and climate change driven by human activity, climate change has been a fact of life for generations. Societies have struggled with fluctuating climatic conditions and the impact they have had primarily on their sources of food and raw materials.
From a business perspective I see climate change as analogous to changing economic and market conditions. Indeed weather and climate terminology fills much of our discussion about economic and market conditions. We talk about “hot markets”, “weathering the downturn” and confronting the “winds of change”.
Successful businesses, like successful societies are those that prepare for and adapt to changing conditions. Societies that survived climate change had become used to periodic fluctuations and were good at creating reserves of essential resources or adapting their practices to different environmental conditions.
Likewise sustained businesses are also good at preparing themselves for downturns, avoiding excesses (for example over expansion) in hot markets and remaining alert to signs of improvement during tougher times. In some instances changes may be permanent rather than cyclical as new competitors, products or changing customer tastes lead to the decline of a particular product or service.
The key for businesses today, constantly pressured into focusing on short term issues, is to ensure that someone in the business remains focused on the broader, longer term external environment – searching for signs of cyclical or more permanent shifts in economic and market conditions. An activity we call Foresight!
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