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Entropy: The cost of staying in your comfort zone.

ABC co is a successful business, distinctive in its market.  The CEO and the business are recognised as leaders, icons in their industry. People working in the business have a great sense of pride about what has been created and their market positioning.

Over time, competitors have emerged, offering similar products and services, but with more value. What was once distinctive to ABC Co is now ‘standard’ and available from many sources.

Achieving results for ABC Co seemed relatively easy, what needed to be done took effort, but everyone in the business was clear about what to do. Today, merely treading water is so much harder.

Sound familiar? How do you counter this process of entropy, “order turning to chaos” particularly when things are going well..?

Staying within your comfort zone is a sure-fire way of ensuring that you will inevitably face the scenario that ABC Co is now experiencing. As Jack Welch is quoted as saying .. “If the rate of change on the outside exceeds the rate of change on the inside, the end is near.”

Is your organisation attuned to the rate of change in your industry – or has past success resulted in complacency, an ‘assumption’ that things will always be good? Have you as CEO and hence your organisation fallen into the mode of staying in your comfort zone precisely because it is comfortable?

Prevention is better than cure. You need a culture that thrives on taking initiative, driving innovation, a leadership team appropriately skilled, clear about their market position, a business that has great systems and processes, including monitoring market shifts and a strategy that focuses on your north star and distinguishes how you will win. 

If you want a culture that,  as Jim Collins says is “productive paranoia” then you must start with the person in the mirror. You must answer the question, honestly – “am I staying in my comfort zone?”  And if you are staying in your comfort zone, what is the opportunity cost of staying there, particularly in the long term?

Remember, as the source of inspiration for the leadership team and the business, what you do and what you do not do, is recognised, remarked upon, and followed by your people. The maxim – “it is not what you say, but what you do” applies.  Is it realistic to say we need a culture of productive paranoia, where we are stretching our thinking, taking ourselves outside what has become ‘comfortable’ if the CEO is not demonstrating those same traits?     

This requires honest reflection; it requires a jolt in your thinking. It is easy to respond and be innovative when times suddenly become bad – that is reactive thinking, when all your competitors are doing the same. How much better is it to drive the thinking now, that will translate into value in 1, 2, or 3-years’ time?

This question, ‘are you staying in your comfort zone,’ I recently posed to my CEO Advisory Board group. There were interesting responses, ranging from, “I’m not sure,” through “yes I am and I’m OK with it for the time being,” through to “I now realise that I am, and I need to get out of it pronto.”         

How valuable is it to be asked that simple question, in a forum of peers, that triggers the right reflection that then leads to action? I might suggest this is far better than being jolted into reflection by an unexpected external shift of market conditions.

CEO Advisory Board:

If you are the CEO of a medium to large size private company and want to be supported in a forum of your peers who understand the unique challenges of being CEO, contact me here.

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