I’ve been thinking a lot recently about the longevity of companies.
The reason is pretty simple: this year Lee Hecht Harrison (LHH) turns 50 years old. It’s a remarkable feat for any company, particularly in a day and age where the lifespan of a corporate entity is getting shorter and shorter.
Recent research from Innosight, a management consulting firm, reveals that the lifespan of companies has fallen dramatically over the past fifty years. For example, in 1965 S&P companies had a 33-year average lifespan, by 1990, that had shrunk to 20 years. These days, Innosight estimates it is 14 years. The result is that over the next decade, Innosight believes that approximately half of the S&P 500 will be replaced by new entities.
Part of this is driven by our world of accelerated change, a condition that some companies simply cannot navigate. In other cases, it is the escalating level of M&A activity. Whatever the cause, this trend represents a strong warning for C-suite leaders.
In particular, there are some important questions that business leaders must ask themselves. Do we just accept the trend as inevitable and look on as spectators? Or do we try to anticipate the impacts of this trend and change the way we lead?
This was one of the chief topics of conversation recently as I took part in the LHH Global Leadership Conference, an annual event with our company’s top leaders. This year also marks the start of celebrations around the company’s 50-year milestone. Our conference theme was: Making a Difference – Yesterday, Today and Tomorrow.
Talking with some of my colleagues, I discovered that many have been with the company for quite a number of years and are fiercely proud of what they have built, and they should be, they built a great company.
Other colleagues like myself, who are more recent additions to the company, feel the sense of pride that comes from being part of a company with such a rich legacy. But as much as we appreciate LHH’s history, we’ve been brought on board to equip the company for the future.
I believe that regardless of the length of our tenure in our current organizations, we all have a huge responsibility to figure out how we can lead the company for the next fifty years.
Our challenge comes at a time of profound change and disruption. The shrinking shelf life of the average company shows us that there are no guarantees of success. What I do know is that we can’t afford to be rooted in the past or present state of our organizations.
When confronted with change, many leaders try to focus on yesterday, hoping that the “good old days” will come back. They dig in their heels, and resist any change.
Others are stuck in the present. Distracted by the day-to-day challenges, they are mired in the immediate and the urgent. These leaders spend little to no time thinking about what comes next.
The truly successful and accountable leaders quickly come to a personal leadership decision to embrace the future. They take care of today’s business, but are always thinking about new ideas and strategies for the market conditions that have yet to come. They have the curiosity, agility and courage to shift their mindsets.
How are you showing up as a leader? Are you stuck in the past or consumed by the present? Are you ready to make the future happen, so your company can thrive?
This week’s gut check asks: are you part of the past or the future?