A bias toward change

Photo: Thomas Leuthard via Flickr

When you plan, do you imagine things will change, or stay pretty much the same? Both are biases; both are right; both are wrong.

Technology analysts won’t ever come out and say it, but they have an inherent bias. They always see change coming over the horizon. Your business is shifting to the cloud. Television channels are eroding. Apps are obsoleting Web sites. Whatever it is, they think it’s changing.

You never read a report that says “everything will stay pretty much the same.” Because no one wants to pay for that.

So the analyst is always trying to identify a new trend, a new perspective, a new method. Either that or they see the end of something (television, mainframes, Web sites). The analyst meets with startups, pores over data, and talks to people in companies who have taken a new approach, always in the hopes of finding something new and calibrating whether and when it will make a difference.

Meanwhile, people in big companies tend to have a bias toward the steady state. Their management structures and relationships presume stability. You can make good money by getting really efficient at whatever you do — flying planes, retailing goods, delivering phone service — if it stays as it is. Change is a pain in the ass.

In many ways this explains why big companies hire research firms. They want to get exposed to people with a bias for change. They want to see what’s coming to disrupt their business. They want to defend their model against that change, or jump on it and get a leg up on the competition.

The challenge is the timing. Analysts are often right about the change that’s coming. They’re often wrong about the timing. As Bill Gates said, “We always overestimate the change that will occur in the next two years and underestimate the change that will occur in the next ten.”

Knowing what I know now — including the analysts’ propensity to predict change and overestimate it — I still think you’re better off with a bias toward change. Here’s why:

  • Change always happens at some point. Even if you’re right now, you’ll be wrong eventually.
  • Avoiding change makes you complacent. Complacency is dangerous. It’s pretty hard to react from a standing start.
  • Technology is accelerating the pace of change. If you don’t get used to it, you’ll get left behind.
  • Change is where the opportunity is. It’s hard to get an edge when stuff stays the same — you and your competitors have pretty much fought to a standstill. If you’re going to get ahead, it’s because you noticed that something is changing and acted on it before the other guy.
  • Change is where the risk is. If the other guy sees it and acts on it before you, you’re screwed. (Or, if you want to say it the fashionable way, “disrupted.”)

Even though overreacting to change is dangerous, you’re still better off with a bias toward change than toward complacency. So think like an analyst.

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  1. Welcome insight Josh. You’ve no doubt seen this or similar quotes elsewhere:

    “If you don’t like change, you’re going to like irrelevance even less.”—General Eric
    Shinseki, retired Chief of Staff, U. S. Army