The life expectancy of a firm in the S&P 500 in 1961 was around 61 years. Today it’s less than 18 years.
Only 12.2% of the Fortune 500 companies in 1955 were still on the list in 2014. This means 88% of those companies have merged, gone bankrupt or simply fallen off the list.
What are the successful companies doing that enables them to survive and where do others fall?
How to prosper in an ever-changing world
Change - an overview
Our world is constantly changing. Companies can only deal with a certain amount of change, unless they build a climate that thrives on disorder. Doing so allows them to weather whatever storms and challenges they encounter. Those who don’t are left in the dust.
Adapting
We talk about change as if it has a beginning, middle and end. And we hope the end is close.
But change isn’t like this; it’s continuous. If we can adopt the right mindset, where we’re constantly learning and accepting what’s new, we can relish change and use it to our advantage.
Creating a learning culture
Recognising the need to treat change as an adaptive challenge is a start, and helps organisations think the right way about keeping up with the trials of the uncertain and volatile world we live in. But how does this translate into real world results?
Research shows that to evolve, an organisation must adopt a learning climate. Josh Bersin asked 40,000 business leaders to rate their organisations on their specific learning practices.
These were then mapped to business outcomes. The findings are clear: organisations with strong learning cultures also experience strong business outcomes.
In such cultures, people are curious and attentive. They spot where things could be better, try out improvements, learn and adapt to change.
Empowering a learnacy climate
It’s up to the business to create a climate which promotes learning. There are three ways this can be done:
- Communicate the importance of learning daily
- Encourage taking smart risks
- Enable learning iteratively