OIA Industry Breakfast keynote challenges industry to take risks and evolve

Throughout the next month, SNEWS will recap its coverage of Outdoor Retailer Summer Market 2014 with select stories from the O.R. Daily we published at the show Aug. 6 – 9. It’s an opportunity for you to catch up on stories you might have missed in O.R.D., and for us to update and upload the articles to our searchable archives.

Do your drinking on trade show evenings with someone else. That tip was among the simple, essential wisdom coming out of Peter Sheahan’s Industry Breakfast keynote speech at Outdoor Retailer Summer Market 2014.

The core message from the founder and CEO of ChangeLabs, an international consulting firm that’s worked with brands from defense contractors to pet product retailers, was to embrace the changes in the market. That requires being willing to walk away from what you think and how you do business, which can begin, at least this week, with who you’re drinking with, and what you’re drinking and where you’re drinking it.

That’s the networking version of the small, scalable risks companies looking to adjust to a changing consumer market should begin taking, preferably before the platform of customer base and revenue on which they’re standing is burning.

“We’re facing unprecedented disruption and it’s not going to go away,” said Jennifer Mull, chair of the Outdoor Industry Association board of directors and CEO of Backwoods Equipment, in her opening comments for the breakfast. “New market dynamics are demanding more of us and our business every day.”

The new strategic plan approved by the OIA Board of Directors calls for changing, evolving and growing in three core areas: new consumers, new ways of recreating and a business of the future.

“The world has changed. Our consumers are different,” Roger Spatz, president of Eagle Creek, sponsor for the keynote, said in his introduction for Sheahan.

How businesses change and evolve is central to the work Sheahan does with ChangeLabs, which has a client list that includes Google, Coca Cola, Goldman Sachs, Hilton Hotels, Harley Davidson and GlaxoSmith Kline. The worst thing the outdoor industry can do in the face of it isn’t curl up in a corner and cry, he said, it’s acknowledging that the market is changing and something needs to be done to adapt to it and then fail to act. And those decisions don’t all have to be top-down.

“Change doesn’t have to start at the top of an organization,” Sheahan said. “Don’t go back to work thinking change is the CEO’s job.”

His opening words of comfort: The outdoor industry is not alone. What’s happening now in the outdoor industry is textbook for a maturing industry, meaning there are a lot of other industries to learn from.

He cited one example after another of companies willing to toss out the existing framework for how they were thinking about and doing their business in favor of accepting an innovation they might have dismissed earlier. Take that defense contractor, whose employees largely laughed in the face of the MIT professor who said social media was going to become key to social changes. The few who listened were ready with software to gather data from social media nine months later when the Arab Spring took off.

“The assumptions you make are usually anchored in the world as it used to exist, and not as it is,” Sheahan said. “In times of change, the most important thing is that you’re making decisions rooted in your beliefs, and the most important thing you need to do is suspend your judgment.”

Any and all tactics adopted in the name of evolving should come from belief systems — those beliefs, he said, can matter more than the decisions that stem from those beliefs.

Backing up to take a 360-degree view of your beliefs can help find an innovation that stays true to what’s at the core of your business, without hyper-focusing on a niche goal that narrows access points for customers and takes a bite out of potential revenue.

The videogame industry has a lesson on that. While Sony and Microsoft were battling it out to keep their edge with hardcore video game users, Nintendo took a broader look at who else in the world might want to play games. It took its game system the opposite direction, toward user-friendliness and inclusivity: Enter the Wii, and a spike in profits.

What the outdoor industry should glean from the industries that have faced this issue of evolving to address disruption, primarily, is differentiate or die.

“Staying in the middle is the land of the boiling frog,” Sheahan said.

Market disruption forces a focus on a specific mastery area — niche, volume or services. Focus on appealing to a narrow, specific customer need (Apple being an example of a niche company), delivering the lowest price point (not recommended for outdoor industry, he said, because it requires big box-scale development) or providing the best customer service. In short, be remarkable and talked about in some way.

Take the risk, he said, and don’t measure its success by anything but whether you learned from the experience.

–Elizabeth Miller