The Seven Deadly Sins of Transition: A Series

By: John Hotson,
Business Transition Alliance Co-Founder

Deadly Sin #3: If It Ain’t Broke – Don’t Fix It!

In the first two articles in this series we talked about how owners who have built up a successful business have worked hard on seven good habits that have served them well in developing their business. Now however they need to undo and rework those good habits if they are to successfully transition the business, either through a sale or hand-off to family.

The third habit that owners have to rework is “If It Ain’t Broke – Don’t Fix It!

If It Ain’t Broke – FIX IT!

While this may have been an excellent habit to develop while building dependability and consistency into the culture of a company, it can over time create a level of complacency – a “that’s the way we’ve always done it” mentality. Or worse a “that’s not our business” attitude.

As a business owner who has been successful doing things a certain way, it may be very discomforting to admit that nothing lasts forever. Because when things are going well and business is good, it is tempting to assume that it will always be this way. Your default position is to continue in a steady state for as long as humanly possible. But in fact the opposite is true: the base case or status quo these days is actually a state of decline, and in life and business this will lead to entropy and decay.

At a time when a new team is taking over, rather than sticking with the same old, same old, the owner’s battle cry should be “If It Ain’t Broke – FIX IT!

Business Disruption

Even the most reliable of business models must at some point consider the prospect of disruptive change. The taxi business, the hotel industry and the video distribution business all have one thing in common – they never saw their disruptors before they hit them.

Looking ahead, traditional business such as banking, insurance, healthcare, the legal industry, data security and more are all up for a serious rethink. The trickle down effect will impact many traditional businesses that are in fact thriving today.

Some of these changes are simply related to the passage of time; technology advances, tastes change, or customers just get bored and want something new. Other forces are more intentional – whatever you are doing, someone somewhere is working on making you obsolete.

Whether it’s Uber VS the taxi business or Netflix VS Blockbuster, there are always people who want a slice of your pie. They know they can’t compete head-on, so they work on changing the rules.

Here’s a useful, if alarming, exercise. Look back over the past five years at how much has changed. Now go back to your plans for the future and see if they incorporate a similar level of change.

Take a lesson from those who live with rapid change. Intel, for example, 90% of whose revenues in any given December come from products that weren’t shipping in the previous January. What’s the most famous phrase associated with Intel? It’s Andy Grove’s memorably titled business classic, Only the Paranoid Survive. So cultivate some productive paranoia.

As the new owners or management team set their sites on the next level of success for the company, it’s a great opportunity to reexamine the things that the company is tied to doing. Ask yourself some questions:

  • What business are we really in – is it the same business we started out in 25 years ago?
  • What impact will technology have on our business over the next 5 – 10 years – are we ready for that?
  • What is our competition doing – should we be trying that?
  • What are the strengths and weaknesses of the new team – do they align with what we do well today as well as having some fresh ideas?
  • Are there any disruptors out there that we have been ignoring?

The challenge for owners who have done things the same way for many years – and been a success at it – is being able to look at their business critically 10 years from now.

Next 30 days: Have a brainstorming session with your staff on what could possibly change in your industry over the next 3-5 years (remember there are no dumb ideas). Discuss what impact those changes could have on your business.

  • Reference:
    • Only the Paranoid Survive – Grove
    • If it Ain’t Broke…Break It! – Kriegel
    • Forbes

About John Hotson:

John is a seasoned marketing and communications professional. He has worked as both a business owner and advisor to owners who are committed to improving the value of their business. John is a co-founder of The Business Transition Alliance.

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