In a recent article Elie Ofek and Luc Wathieu argue that companies struggle not with identifying emerging trends but to interpret them correctly. This confirms our own findings that showed that firms where generally hard to surprise about a trend they failed to produce a adequate response (see our discussion in these previous posts: 1 and 2.
In their article “Are You Ignoring Trends That Could Shake Up Your Business?” Ofek and Wathieu argue that firms fail to respond to trends for three reasons:
- they ignore trends that are outside their product categories
- they respond to a trend in a superficial way before having created a deep understandings of the trend and its relations to their business
- they wait for too long and thus have already lost the new market to competitors.
They also illustrate with cases that firms have three option on how to deal with trends:
- they can infuse aspects of the trend to enhance and extend their current products
- they can combine aspects of the trend with their current product categories and create a new one
- they can counteract negative aspects of the trend to protect their current product categories.
Ofek and Wathieu do a great job to illustrate their arguments with cases and provide a convincing argument about the difficulty of creating a deep understanding of the implications of trends. They also emphasize our point that in order to create firms that a resilient agains discontinuous change and able to systematically profit from trends we need a better understanding, how we can facilitate the crucial strategic discussions that are needed for interpretation, learning and producing adequate responses.
Full reference: Ofek, E., & Wathieu, L. 2010. Are You Ignoring Trends That Could Shake Up Your Business? Harvard Business Review 88(7/8): 124-131.