Companies operate in an increasingly complex world: Business environments are more diverse, dynamic, and interconnected than ever—and far less predictable. Yet many firms still pursue classic approaches to strategy that were designed for more-stable times, emphasizing analysis and planning focused on maximizing short-term performance rather than long-term robustness. How are they faring?
To answer that question, we investigated the longevity of more than 30,000 public firms in the United States over a 50-year span. The results are stark: Businesses are disappearing faster than ever before. Public companies have a one in three chance of being delisted in the next five years, whether because of bankruptcy, liquidation, M&A, or other causes. That’s six times the delisting rate of companies 40 years ago. Although we may perceive corporations as enduring institutions, they now die, on average, at a younger age than their employees. And the rise in mortality applies regardless of size, age, or sector. Neither scale nor experience guards against an early demise.
We believe that companies are dying younger because they are failing to adapt to the growing complexity of their environment. Many misread the environment, select the wrong approach to strategy, or fail to support a viable approach with the right behaviors and capabilities.
How, then, can companies flourish and persist? Our research at the intersection of business strategy, biology, and complex systems focuses on what makes such systems—from tropical forests to stock markets to companies themselves—robust. Some business thinkers have argued that companies are like biological species and have tried to extract business lessons from biology, with uneven success. We stress that companies are identical to biological species in an important respect: Both are what’s known as complex adaptive systems. Therefore, the principles that confer robustness in these systems, whether natural or manmade, are directly applicable to business. To understand how, let’s look at what these systems are and how they function.
As 2022 starts, let’s take some time to share our goals for CircuitPython in 2022. Just like past years (full summary 2019, 2020, and 2021), we’d like everyone in the CircuitPython community to contribute by posting their thoughts to some public place on the Internet. Here are a few ways to post: a video on YouTub, a post on the CircuitPython forum, a blog post on your site, a series of Tweets, a Gist on GitHub. We want to hear from you. When you post, please add #CircuitPython2022 and email email@example.com to let us know about your post so we can blog it up here.
Stop breadboarding and soldering – start making immediately! Adafruit’s Circuit Playground is jam-packed with LEDs, sensors, buttons, alligator clip pads and more. Build projects with Circuit Playground in a few minutes with the drag-and-drop MakeCode programming site, learn computer science using the CS Discoveries class on code.org, jump into CircuitPython to learn Python and hardware together, TinyGO, or even use the Arduino IDE. Circuit Playground Express is the newest and best Circuit Playground board, with support for CircuitPython, MakeCode, and Arduino. It has a powerful processor, 10 NeoPixels, mini speaker, InfraRed receive and transmit, two buttons, a switch, 14 alligator clip pads, and lots of sensors: capacitive touch, IR proximity, temperature, light, motion and sound. A whole wide world of electronics and coding is waiting for you, and it fits in the palm of your hand.
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Join us every Wednesday night at 8pm ET for Ask an Engineer!
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