The High Risk of a ‘Wait and See’ Approach

A weekly newsletter featuring the biggest ideas from the smartest people

Chances are your company is one of the many taking a “wait and see” approach to one or more business issues right now. The approach plays out like this:

“Should we redo our website? Let’s wait and see what the competitors do.”

“Should we expand into a new market? Let’s wait and see what the economy does.”

“Should we invest in cloud technologies to increase the speed and agility of the organization? Let’s wait and see what new innovations will be released.”

On the surface, taking a “wait and see” approach seems to make sense. After all, we’re dealing with a U.S. and global economy that’s filled with uncertainties. We’re hearing news reports that predict a long and drawn out recovery. We’re witnessing not just rapid technological changes, but major transformations on so many levels. So “waiting and seeing” what happens certainly seems less risky.

In reality, a “wait and see” approach has much more risk than the action being avoided. Here’s why. In the past, when we were going through rapid change (not massive transformation like we’re seeing today), a company could use a “wait and see” approach because it was harder for competitors to develop and deploy new offerings quickly, and it was harder for established competitors to change the game or redefine completely. None of that is difficult anymore.

Today, new competitors can emerge rapidly, and they can even be from another part of the world. Geography is increasingly less of a hindrance. Anyone, at any time, can quickly become more relevant than you because the barriers to entry are low and the ability to scale is fast. Therefore, in a world were the game is changing rapidly, failing to take action—deciding to “wait and see”—can quickly put you on a path of increasing irrelevancy or a rapid demise.

Additionally, with many adopting a “wait and see” approach, the pace of recovery will be very slow indeed.

Transform To Grow

When you start looking at the certainties around you (which point to opportunities), rather than focusing on the uncertainties (which point to risks), you can see how detrimental a “wait and see” approach can be—how you’re actually missing major new opportunities for sales and growth. In an uncertain world, it’s important to focus on the certainties. So, what are you certain about?

One thing that’s certain regardless of industry or profession is that we have massive business process transformation taking place. Which processes? Virtually all of them: purchasing, logistics, accounting, sales, marketing, communications, collaboration, innovating, educating, training, managing, releasing new products, engaging our employees…the list is endless. We’re transforming all of these things plus more, and if you don’t initiate the transformation, someone else will.

To see the difference between mere change and game-changing transformation, consider these examples: Barnes & Noble may have changed bookselling by creating the super bookstore, but Amazon transformed how we buy books and so much more. Blockbuster Video may have changed how we rent movies, but Netflix transformed it. Yahoo! may have ushered in the era of search, but Google transformed it. Best Buy may have changed the retail environment, but Apple transformed it.

Here’s another current transformation: This year, many forward-looking school districts across the country are moving away from textbooks and issuing tablets filled with ebooks to students. Grandview High School in Jefferson County Missouri is one such school. Students will use the tablets to take tests, do homework, and complete assigned readings using applications and programs such as Moodle, a free online classroom. The tablets will also contain digital copies of textbooks as well as free online textbooks. An Internet filter blocks inappropriate web sites. This is a game-changing move, and one that will save the school about $25,000 each year. Students will keep their tablets, which will be updated, throughout their high school careers. And when they graduate, they can keep them.

The tools to redefine everything—even education—are there. The question is, are you using them?

The Hidden Costs of Saying “No”

When people are given an option to do something or not, they think that the expense is in saying “yes.” Actually, given the transformational changes taking place today, the bigger expense is often in saying “no.”

For example, suppose someone suggests that your company have its website redesigned. You may immediately shoot down the suggestion and say, “No. We’re not investing in that. We already have a website that works just fine.” It seems that the expense of creating the new website comes when you say “yes.” It’s less expensive to “wait and see.”

But consider that what you can do with a website today is much different than what you can do with a website that was created two years ago. The way you can design for mobile users, engage visitors, increase sales, track people, and improve your rankings with search engine optimization are changing so rapidly that if your site is two years old, it’s obsolete.

So while saying “yes” and taking action seems expensive, saying “no” and “waiting and seeing” will actually be more expensive in the long run because of the opportunities (read: increased relevance, visibility, and sales) you’ll be missing. And this goes way beyond website design. Saying “no” to any new capability—whether it be embracing tablets for the enterprise, levering mobility in new ways, adopting new collaborative tools that can revolutionize how your teams work, or using the cloud to more rapidly deploy innovations—does not allow you to transform while competitors are taking action.

Therefore, you have to evaluate what you’re saying “no” to in terms of potential lost opportunity, because what you could gain by saying “yes” will often outweigh the perceived risk and expense.

Think about it…at some point, someone within the Apple Corporation pitched the idea of opening retail stores. Apple could have very easily said “no” to the idea. They could have looked at Circuit City and Best Buy and said, “Why would we want to do that?” Rather, they looked at the current retail model and asked, “How can we reinvent retail?” They looked at what wasn’t working with retail and used a transformational mindset to redefine retail and extend their brand.

On the surface, had Apple said “no” to opening retail locations, it would have seemed logical. After all, opening a retail stores takes lots of money and effort. There’s an immense risk involved. But they saw the certainties around them and thereby saw the opportunities in saying “yes.”

Stop Waiting; Start Doing

In a world filled with uncertainty, it’s easy to fall into a “wait and see” mindset. But waiting and saying “no” has a cost just as high, if not higher, than saying “yes.” Because technology is increasing so fast and because we are in a period of rapid transformation are the exact reasons why you can no longer “wait and see” what will happen.

Remember this: “If you don’t do it, someone else will.” And they’re doing it right now!

***

A weekly newsletter featuring the biggest ideas from the smartest people