Changing World
I think it is safe to say that this year has had an impact on every person. While everyone’s experience has not been the same, everyone has been impacted in a way that is indelible. The consequence in the marketplace is equally significant; I believe we have passed an inflection point in the economy that will have long-lasting effects. We aren’t just dealing with the immediate disruption caused by the shutdown of the economy and the struggles companies have faced. Instead, every paradigm that drove the economy has been disrupted and new paradigms are being formed.
Responding to this shift in the economy should be the priority of every CEO. However, the reality is that most executives are so preoccupied with the day-to-day running of their companies that they don’t have the time, energy, or focus to undertake a strategic pivot that can transform their business to respond to the new environment. My answer to this need begins with the formation of Transformatus LLC, an executive advisory specifically aimed at private-equity and family-owned mid-market companies facing these challenging times.
What is Transformatus?
The idea behind the advisory business is the recognition that there are threats, and opportunities, that are emerging in what I have previously called The Next Normal that must be address by business leaders. The need to transform businesses in response to the accelerating change has never been more critical; the advisory was named with this in mind.
The term “transformatus” (pronounced trans-for-mat-us) means transformed in Latin. When a business becomes transformatus, they have achieved a fundamental shift in the foundation of their business. My hope is to help them through that journey.
What is Unique About Transformatus?
The cornerstone of our approach is the building and growing of enterprise value. This idea seems simple on the surface, but in practice, it requires thinking beyond the normal boundaries of the enterprise. Having the discipline and conviction to drive the business towards a new and unfamiliar destination is not easily done, so having a partner in the process can go a long way towards success.
Surprisingly, maximizing the long-term value of a business is not about optimizing the day-to-day profitability. Instead, shifting the focus to finding and executing a transformative strategy can put the business on a new value-growth path. Today, such a strategy is built on technology – data, systems, processes – that enable traditional business models and markets to be disrupted.
Unfortunately, CEO’s are often so caught-up in fighting the crisis-of-the-day (i.e. COVID-19 pandemic, etc.) that discovering and pursuing a game-changing strategy can seem impossible. Having an experienced partner to help identify, test, and execute the transformative strategy is the essence behind this new advisory business.
Experience
The expertise of most CEO’s is often centered in the industry in which the company operates. While helpful in optimizing the short-term operating efficiency of the business, it tends to create blind spots beyond the centerline of the business. This bias prevents these leaders from seeing great new directions for their company. Also, transformative change is something that few executives have experienced in their careers; having an executive at your side who has done turnarounds and strategic pivots can go a long way to improve your success with the business.
Methods
Great strategy does not emerge from inspiration; instead, it is the product of a disciplined process to discover, evaluate, test, and implement a strategic path for the business. Each step is methodical, ensuring that all possibilities are explored and evaluated with consideration for the potential, and probability, of success. This methodology, applied in the Transformatus model, steps through possible strategic directions (markets, customer segments, products, services, customer experience, distribution channels, etc.) to find paths worthy of further exploration. The goal is to identify paths that are both familiar, AND unfamiliar, and weigh them in the process.
Flexibility
While I advocate for a methodical approach, that doesn’t mean a one-size-fits-all for all businesses. To the contrary, the process should be adapted to each situation to account for differences in the specific knowledge, experience, and bandwidth of the leadership team and the unique characteristics of the business. The point is to enable the team to achieve greater things, not to be an alternative to them. Flexibility is the key.
Value
There is hidden value in most businesses; finding and unlocking this value is the goal of the Transformatus process. Focusing on the “Big Picture” drivers of long-term profit growth and providing the leadership the tools to execute against these drivers, enables success. This long-term approach does not mean results are pushed into the distant future; instead, the shifted “transformational” mindset immediately translates into business improvements that yield significant gains.
Why Should You Seek Transformative Change?
A transformative journey is a choice. You can continue running your business on its current path or you can venture out to find a new direction. If you choose to stay your current course, history has repeatedly shown that such a choice may be unwise over the long haul. Companies that remain attached to the status quo during periods of disruption ultimately end up in the graveyard. I strongly believe we are in, or entering, an era of rapid evolution in the marketplace; now is the time to make bold moves or be left behind. The wise choice is to be bold and seek out a transformative strategy for your business.
Conclusion
The economy as we knew it entering 2020 has been permanently disrupted. The change is not intermittent, instead we are on an evolutionary trajectory that is rapidly accelerating. Opportunities for building enterprise value are present but are not found in the status quo of your business. Pursuing a new path requires creativity, experience, and some new perspectives. Transformatus is a great resource for mid-market companies who are looking for these fresh ideas, or just a second opinion. Schedule a quick call to learn more about how we might be able to help you get great results.
Copyright © 2020 Douglas C. Fergusson
