Provoke summary

Picture a generic office, sometime in the late 2000s: there’s a potted plant in the corner, a view of the city skyline through the window, and, leaning back in his chair, a high-ranking executive. Sitting across from him are two data analysts. They’ve just explained their latest findings to the exec – a healthy proportion of their client base is behaving exactly the same way it always does. But, a small percentage has started to change how it interacts with the company’s product. The analysts think this could be the start of a trend.

The exec interrupts them: “What percentage are we talking about here?” he asks.

“Only 1.75 percent,” say the analysts.

The executive leans back in his chair. Not worth worrying about, he tells them. Meeting over.

Right call? Or wrong call?

Wait – before you answer that question, let me give you a little more context. The company in question was a big media company – think cable television. And the 1.75 percent of consumers? They were early adopters of video upload websites, like YouTube, where they were watching snippets of online content.

The executive who decided those consumers weren’t worth worrying about definitely made the wrong call. And, hey, that’s understandable. Without the benefit of hindsight, it's hard to discern whether a statistic like that 1.75 percent is the first tremor of an earthquake that will radically reshape the consumer landscape or an anomaly that will never amount to anything.

It’s impossible to give you a failsafe formula to tell earthquakes from anomalies. But the vast majority of corporations don’t see the early signs of earthquakes.

Why not?

Well, there’s a pattern to the way large corporations respond to environmental shifts and discrepancies that might signal a significant new trend.

They miss the trend, even when it's obvious because they view it through the filter of their own experience. Remember our executive? His teenage kids may well have been watching YouTube clips right under his nose – but because he couldn’t imagine engaging with media in that way, he wasn’t interested.

They overanalyze the trend. When data shows changes in consumer behavior what do most companies do? Double-check the numbers. Run more surveys. Assign task forces to prepare reports to present to management . . . You get the picture. By the time they’ve finished analyzing the trend, it’s far too late to get ahead of the trend.

Finally, they respond to the trend – but it’s too little, far too late. Often, the best outcome a corporation in this position can hope for is to become a wind-down firm, on the path to obsolescence. And that’s okay! Firms that know they’re in the wind-down phase can often time their exit from the market sensibly and even make a profit in the process.

For some people, winding down doesn’t sound so bad. It’s safer and easier than trying to pinpoint the next trend on the horizon, staying perpetually relevant and innovative. If that’s you – no judgment. But you can probably stop reading this Blink.

If, on the other hand, you want to capitalize on and shape future trends, keep reading.