The 3 Business Types – And Why 2 of Them Consistently Fail!

There are three business types. Two of them consistently fail. The modern leader must choose to design their company to survive. Learn which business type can do this.

3 Business Types: One – The Static Business

The static business is not designed to change or adapt. Usually, it has one good idea and it keeps selling that idea until it is no longer worth anything. Sadly, the business eventually dies.

This business type is built for failure in a changing world. And, you will see many of these business types in Asia. They are the small, family-owned businesses that are old-fashioned. Although they may have been in the family for generations, this will not help them. Unfortunately, they will die out as new ideas emerge and their service or commodity is no longer needed.

Good examples of this business type are the record shop, the video rental business or the postal service. Any business that did not learn to change with the times, will have died out.

3 Business Types: Two – The Dynamic Business

Of all the three business types, the dynamic business is the most common. It is a business that changes, but not as frequently as it should. And, not for the right reasons.

The problem with the Dynamic Business is its cause of change. You see, the Dynamic Business is usually motivated to change by crises. It is not actively seeking betterment. Rather, it meets a challenge to overcome, and it tries to overcome it.

Resultantly, these kinds of businesses are often in crisis management mode. They put out fires all the time, rather than taking a fire prevention course.

Good examples of this kind of business are Kodak, the film company, or Motorola, the phone company. Both had great ideas, but they couldn’t keep up with the times.

3 Business Types: Three – The Adaptive Business

The Adaptive Business is the most likely to survive. It is not that it a better approach. Rather, it is the right approach for the current economy.

You see, the world has changed so much since the computer age that change is now a decisive factor in how we should design our businesses. This means we can no longer design our organizations for stability and control. They must be designed for adaptability, flexibility and change,

This requires, not only a change in mindset, but a change in the way we lead and manage.

Furthermore, the Adaptive Enterprise must learn new techniques to do this. Indeed, learning is the key to its adaptability. Without learning, a business cannot change. So, the business must find a way to make learning a part of its culture.

3 Business Types: Conclusions

Many businesses will be born, grow and die without ever understand what it was that killed them.

Of course, many will die through mismanagement or simply poor strategy or marketing. But, many of these issues can be overcome by creating a culture of adaptability.

That’s because the culture of adaptability includes and encourages the input of more people, with more empowerment and with less centralized control. The result is a business more likely to overcome challenges, more likely to see those challenges before they arrive and constantly innovating so that those challenges arise less frequently.

The author, Michael Paul Stephens, is the founder of Provolution Consultancy, a Thailand-based corporate training business that helps companies build a better culture through The Human Spirit Model®. This model is the ultimate team-building  program and has enabled dozens of businesses across Asia to develop a culture of trust and respect that balances human needs and business needs equally.