0

May 15, 2016 AT 4:00 am

The Biology of Corporate Survival #Biomimicry

R1601B REWELL 1200x564

Via The Harvard Business Review

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.

Read more


Check out all the Circuit Playground Episodes! Our new kid’s show and subscribe!

Have an amazing project to share? Join the SHOW-AND-TELL every Wednesday night at 7:30pm ET on Google+ Hangouts.

Join us every Wednesday night at 8pm ET for Ask an Engineer!

Learn resistor values with Mho’s Resistance or get the best electronics calculator for engineers “Circuit Playground”Adafruit’s Apps!


Maker Business — Lessons Learned Scaling Airbnb 100X

Wearables — Start with a sketch

Electronics — When do I use X10?

Biohacking — Project Peri – Translates Sound into Light for the Hearing Impaired

Get the only spam-free daily newsletter about wearables, running a "maker business", electronic tips and more! Subscribe at AdafruitDaily.com !



No Comments

No comments yet.

Sorry, the comment form is closed at this time.