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Strategic Dynamics and Driving Change

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With the recent high-profile ouster of University of Virginia President Teresa Sullivan, there has been a lot of discussion of how corporate tactics work. If you're unfamiliar with the story, Sullivan was asked to resign rather than be fired by the Board of Visitors because-as they stated later-they felt she was not driving change in the university quickly enough. In particular, the board was concerned the public university was failing to keep up with the new demands and opportunity of online learning.

I'm not taking sides on this event, but I am fascinated by it for the simple reason that there seems to be a cultural clash between the board and the university. Predominantly, board members are highly successful corporate players. Academicians are, well, academicians. There is bound to be conflict between the corporate world and academia.

While we don't see this kind conflict in the metal construction environment because we are almost exclusively corporate oriented, there is a heightened belief that all our problems can be solved if we apply strong management consulting principles. It is a belief that permeates every level of the building product supply chain from manufacturers to contractors to trades people.

The latest corporate management philosophy is called "Strategic Dynamics," and it is a reaction to the very real phenomenon we all face, which is the rapid pace of change. Followers of strategic dynamics believe that the pace of change is so quick that we must move more aggressively in decision-making or fall behind. Our business entities must be far more resilient and responsive to market needs.

I think this is true, but I think it is far less true in the construction environment. Truthfully, the pace of change in our little corner of the universe is startlingly slow. We do have innovation, but massive innovation that has substantially changed the way we construct buildings takes forever to materialize.

I saw a report a number of years ago that stated it took about 50 years for a new building product to gain wide acceptance. That's probably an exaggeration, but the building product supply chain does tend to hold fast to its well-worn solutions rather than adopt new technologies. Trades are slow to switch because it can involve substantial training and new capital investments. General contractors often face fears of increased liability if they adopt a new product, and it doesn't perform as promised. Designers are reluctant to suggest dramatic solutions because of concerns about performance as well and the potential for increased cost.

The result is that even within the supply chain there may be a corporation that embraces the need for rapid change (and change is the only constant in life), but the rest of the supply chain probably would not fall easily in line. Imagine a company that brought a breathtakingly advanced product to market, investing millions in research and development, but could never get the rest of the supply chain to adopt it because of their concerns about its performance, or their own increased costs to install it, or lack of acceptance among less knowledgeable building owners. That kind of acceptance stultifies massive innovation and change. Strategic dynamics, as a corporate philosophy, runs up against the same kind of defiance from the supply chain that it does from academia.

This the very real environment in which we work, where metal building products can strain to gain market share and further acceptance because, in many instances, they provide dynamically different alternatives. And the acceptance of those alternatives by the building product supply chain is slow.

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