There is so much talk about the importance of managers having a business trends awareness skillset in order to help their organizations adapt to changes in the marketplace. While I agree that this is important, I also believe that non-managers should develop this competency as well. Given that, I pondered the question: “Is there a way to create a system in which all individuals in an organization (managers and non-managers) could be actively engaged in identifying emerging business trends? After reviewing the literature on this topic, I’d like to propose a four-step system that could be implemented in your organizations.
STEP 1: Identify and Prioritize Environmental Categories
Strategy scholars and practitioners suggest two things that are needed to detect emerging business trends. First, knowing the current stage of an industry’s life cycle. Over time, every industry progresses through four stages: Introduction, Growth, Maturity, and Decline. Second, after identifying the life cycle stage of the industry, having a deeper understanding of the external factors that shape the industry. External factors can be classified into the following general environmental categories:
• Complementary products or services: “Products or services that can be used in tandem with those from another industry.”
- Technological Change: “New products, new processes, new materials.”
- General Economic Conditions: “Economic growth, interest rates, inflation.”
- Population demographics: “Changes in population, age, gender, ethnicity, income distribution.”
- Ecological/natural environment: “Changes to the physical environment.”
- Global competitive forces: “The ease (or difficulty) of doing business across national borders.”
- Political, legal, and regulatory forces: “Laws, regulations, political processes.”
- Social/cultural Forces: “Cultural values and attitudes which can often affect the other environmental categories”
To get started, executive leadership could prioritize and rank the categories above based on a) relevance to the industry in which the organization operates, b) greatest impact on the industry, and c) most likely to change or shift in the near future.
STEP 2: Establish Employee Resource Groups (ERGs)
Strategy scholars and practitioners also suggest that in addition recognizing and keeping abreast with changes in the environment, it is also important to determine the direction of those changes and the possible effects. Keeping up with changes and occurrences in the business environment can be a very challenging task. Because of this, I recommend engaging all employees in this process. This can be accomplished by creating employee resource groups (ERGs). ERGs can be effective in helping organizations improve an organization’s leadership development process, tackle company-wide challenges, and keeping leaders in the know about issues. As part of this system, an ERG could be created for each environmental category, and employees could choose to be a part of the ERG most interesting to them. The key activity for each member is to collect information on events/occurrences germane to their assigned environmental category and to make some insights and recommendations. To streamline the process, an organization could create a brief standardized online form that employees could use to submit their information and responses to the following questions: 1) What is the event/occurrence? (Include a short 1-2 sentence description and include a website link/reference if available); 2) Why is this event/occurrence important to our organization? (i.e. Does this event/occurrence work to our advantage/disadvantage); 3) What is the level of urgency of this occurrence? (i.e. Immediate concern or a future concern); 4) What should our response be? (List 2-3 ideas). While each member of the ERG completes this on an individual basis and submits the information online, all of that data and information is collected and storediscuss their collective findings.d in a central location for retrieval. Members within an ERG could decide to meet as a group to discuss their collective findings.
STEP 3: Conduct Business Trends Meetings
The image of a jigsaw puzzle can only be complete when all the puzzle pieces are joined together. Likewise, assembling all ERGs together for a monthly Business Trends meeting helps all employees to see the bigger picture of external factors affecting the industry and the organization. During this meeting, each ERG shares the most important occurrences and insights they have previously identified. After each group presents, a facilitator points out any emerging themes which might lead to a larger group discussion or suggestions for additional things to look out for in preparation for the next Business Trends meeting. The key benefit from this process is that if the organization encounters an unexpected situation in which a business pivot needs to occur, the organization is positioning themselves to do it at a faster pace given the groundwork, insights, and knowledge already available to better inform top level decision makers.
STEP 4: Store Information and Insights into a Knowledge Management System
In the December 2020 issue of Fargo INC!, I discussed the idea of making knowledge sharing a formal practice within organizations. In order to share knowledge and insights, it would be important to have a place to store it for easy retrieval when needed. This is where your organization’s knowledge management system comes into play. Simply put, a knowledge management system can be anything that your organization uses to assist in storing, organizing, and retrieving information. Given that your organization is capturing valuable explicit and tacit knowledge to be used to make strategic decisions, security measures should be implemented to guard against unauthorized access to your organization’s internal knowledge base. I hope you find these guidelines and recommendations beneficial to your organizations. Best wishes for a great start in the year 2021.
To submit questions you would like answered in future editions of “Academic Insight”. Email Dr. Aikens at: [email protected] FA