Last Friday I wrote about how successful companies are constantly redefining their purpose. I gave the example of how IBM has successfully redefined itself over the decades, initially from a company that was specialized in ‘business machines’ to a global powerhouse helping companies manage and leverage their knowledge assets.
IBM’s redefinition went from a particular type of knowledge and information management–the punch card reader–through progressively more general applications and approaches to knowledge management. In a sense, IBM’s strategic purpose become more general and abstract over time. This is what I propose companies must do to remain relevant and continue growing over time.
The key question in this redefinition is to ask what your current activities are an example of. For instance, IBM would have asked itself what a punch reader was an example of, and the answer would have been, it’s an example of a general purpose business machine. From there, it could have asked itself what other types of business machines there are. The answer would have been, cash register, typewriters, adding machines, etc. That would have led to a further spurt of growth through redefinition from a punch card reader company to a general use business machine company.
After that, the question is pertinent again. What is a general purpose business machine used for, or an example of? It’s an instance, of machines that are used to manipulate and manage information. What else can do this? Well, if it’s the 1950s, computers. Thus, IBM redefined itself again from a business machine company to an information management company. And so on, through the years. At this point, IBM has asked the question several times no doubt. In each iteration, its activities have become more generally applicable and less focused on specific solutions or instantiations. That is why IBM now defines itself as a knowledge management company.
This is basically what every company must do periodically, especially before its growth levels off. Management must ask itself what its current products, services, and activities are examples of, or alternatively what they are used for. This raises the level of abstraction and generality of its purpose, which in turn provides many more opportunities for growth by expanding its product offerings, extending its market reach, and diversifying into related fields.
© 2012 Richard Martin. Reproduction and quotes permitted with full and proper attribution.
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