Introduction
Today, we are on our 7th element of the Law of MSMEs Success Foundations-LMSF.
That element is a discussion of the need for MSMEs to be adaptable! Lest we forget MSMEs stands for Micro, Small and Medium Enterprises.
Building for both legacy and growth requires one to be flexible and adapt quickly to changes in the industry and the economy as a whole.
We now live in a “VUCA world”! VUCA is an acronym for volatility, uncertainty, complexity and ambiguity. We all know that change has been the constant throughout human history but these days, the pace of change in everything is just too rapid, it is indeed a VUCA world.
What is adaptability?
Adaptability is the uncommon ability to adjust or completely change course in direction of a business outfit in direct response to the Political, Economic, Social, Technological, Environmental and Legal-PESTEL changes positive or otherwise with a view to survive the “storm”.
When change occurs or seems imminent, regardless of the particular PESTEL element concerned, any business has a choice: to do nothing or something in response! Even though doing nothing is a choice, the risks of “business death” are much higher than attempting to respond with appropriate measures!
As opposed to doing nothing when change arrives or indeed is imminent, the MSME can begin a new journey in their line of business or indeed start afresh following a completely new path.
Change though is never easy for most people and indeed MSMEs which by the way, are started and managed by people!Lack of adaptability can be illustrated by what business commentator Theodore Levitt dubbed marketing myopia when referring to 20th century railroad businesses that “failed” to properly capture what their business actually was! Back then the railway businesses saw (defined) their business line as strictly the product itself i.e., the railways and the trains! That narrow definition proved fatal for some businesses that went into bankruptcy and liquidation!
The unfortunate dying of some railway businesses then, would perhaps have been avoided by seeing the broader business as “transportation” and not just “railways”!
With the correct definition of transportation, the arrival of automobiles and air transport on the scene, would have simply made management of the railway businesses affected to incorporate the new modes of satisfying their customers need for transportation as opposed to not adapting to the new reality!
The need to be sensitive to the developments in this VUCA world cannot be over emphasized.
In Zambia, prior to the liberalization and privatization of state-owned enterprises, the unnecessary death of some companies which could have simply changed their ‘modus operandi’ could have been avoided! How? the need of motor vehicle transportation that Livingstone Motor Assembly-LME was serving did not disappear with the Political-Economy changes that had occurred.
Why for example could LME not change from importing FIAT motor vehicle parts for assembly to bringing complete units of all types of used and/or brand-new vehicles as opposed to closing down? Of course, LME example is simplified in this article for academic reasons, given the slow pace at which the bureaucracy slows down governmental decision -making.
Still the point is that businesses cannot afford to be insensitive to PESTEL changes in a VUCA world.
Conclusion
I restate that MSMEs have to be nimble in responding changes in their business environments, which changes, unfortunately are now more rapid as we are living in a VUCA world where volatility, uncertainty, complexity and ambiguity are a given be it in the political, economic, social, technological, environmental or legal spaces.
There is nothing that in the real world that stops PESTEL changes to happen simultaneously! All the best in being alert, aware, awake and attentive! Nahiti mwani!
The Author is Victor PM Nyasulu of VICTOR NYASULU Consult-VNc Partner @NS-CGMA. +260955746997. vpmn69@gmail.com
