Epilogue The Route to Your 2,000 Percent Solution An Evolution Revolution of Continuing Challenge Here you will learn about the danger of complacency stealing back into your organization as you become adept at creating 2,000 percent solutions. Your marvelous success will create even greater risks of complacency. This Epilogue completes the book's treatment of the sixth perspective: creating economic relationships between organizations and their customers, employees, suppliers, partners, shareholders, and the communities in which the organization operates to provide much more effective and affluent results for all these stakeholders. This wider, more successful population will in turn continually open up more opportunities for your organization to achieve exponential success through locating and implementing more 2,000 percent solutions. Keep Your Feet to the Fire . . . Even If You Have to Start the Fire Yourself Once you have $200 million in liquid net worth, you cannot spend or give the money away as fast as you make it. I don't know what to do next. --A successful entrepreneur You should now understand how to make rapid progress by overcoming stalls and adopting new, more effective habits. What you probably do not yet appreciate is how rapidly change can occur, and how large the change can be. This Epilogue provides you with that perspective by describing how fast evolutionary changes occur when survival is at issue using examples from nature and business. When Is It Time for a Change? We have learned in the classroom that evolution takes millions of years, but there are examples of the fact that this needn't be so. The biological rate of change in species can be more than a million times faster than that. A study reported in the journal Nature ("Natural Selection Out on a Limb," Ted J. Case, Volume 387, pp. 15-16, May 1, 1997) tells about an experiment in which common lizards indigenous to the Caribbean were introduced to fourteen islands near the Exumas in the Bahamas. Some of the islands were smaller than a football field. Terrain ranged from barren to lush. The object of the exercise as originally conceived was to study extinction. The researchers were convinced that if they moved the lizards to small islands, they would not survive for long because the new habitats were very ill-suited for them. But instead of dying out, most of the lizard colonies thrived, defying the researchers, because the bodies of the lizards quickly and dramatically changed in their new environments. Fourteen years after arrival in their new homes, the lizards were as different from their ancestors as a jockey and a basketball center (Exhibit E-1). Their original home, Staniel Cay, is wooded. But most of the adoptive islands are almost treeless, the better to bring the species to extinction--or so the researchers had believed. Lizards introduced to islands with scrub vegetation kept their stubby legs and darted about more quickly. Speed is essential for success in the ground lizard world--both to catch insects and to elude predators. Lizards placed on islands with more trees than Staniel Cay developed longer legs and learned to jump from branch to branch. This adaptation made it easier for them to find food and to escape from predators. The rate of evolutionary change in a species' wing or leg or beak (remember Darwin's finches mentioned in Chapter 1?) is assessed in degree-of-physical-change units called darwins. Physical changes detected in a single species after millions of years in the fossil record typically amount to one darwin or less. The New York Times reported in a review of the Nature article on the lizards that the transplanted lizards evolved at daredevil speeds of up to 2,000 darwins. What this experiment demonstrated is that a species can evolve vastly faster if it is placed in the most challenging environment imaginable, where it has little chance to survive. This evolution will occur both because of developing existing capabilities (like the lizards that learned to scurry faster on the ground), and because of natural selection favoring variations in the next generations that are the best adapted to that environment (like the tree lizards). Undoubtedly, environmental pressures can affect human beings as well since almost all our DNA is the same as in all other animals. Potentially, we could change even more rapidly than other animals because through our minds we can adapt mentally more than animals can. Our mental adaptations allow us not only to physically adapt to our environment but to actually change that environment in ways that suit us. Further, we can use the tools we design. The question before us now is: How can a challenging environment make a difference for us in achieving a 2,000 percent solution? Creating the Environment for a 2,000 Percent Solution Let's turn to the experience of a corporate loser facing extinction and see what happens when the decision is made to make the changes needed to approach the theoretical best practice. This situation is the business equivalent of the lizard colonies being relocated onto the new islands. At the time of the decision to create as much of the 2,000 percent solution culture as it could, this company had the lowest profit margin (after-tax earnings divided by sales) in the industry, the second to lowest market share (company sales divided by industry sales), the highest debt-to-equity ratio; poor stock-price growth; and it was forced to charge the lowest prices for its products. Its officers decided they wanted to become an industry leader, to have the highest profit margin, a normal amount of debt on the balance sheet, and a more rational pricing strategy (hopefully including higher prices). Within a year of making the decision to improve, the company increased its market share by more than 50 percent, more than doubled its profit margin to become the second highest in the industry, improved its balance sheet to reach normal debt ratios, and increased its prices to customers substantially. Stock price grew by more than 50 percent in a year when the overall stock market was relatively flat. After seven more years, its profit margin was the highest in the industry. It had almost tripled its market share, slashed its debt to very low levels, and saw its stock price grow impressively by more than ten times the market growth rate. All of this improvement occurred in a commodity industry in which the annual growth rate in units was less than 4 percent. Companies achieve this kind of growth in profits and stock price fairly often in rapidly growing industries where annual expansion in industry sales is over 50 percent, but in slow-growth industries the results normally take decades. How were these changes possible in a dull, laggard industry by a company that had been losing ground? Here is what happened in that company in less than one year. The company measured the profits it could expect to earn by serving its existing customers as well as the profits it might earn if it could land any other potential customer in its universe compared to the profits that its competitors could earn in the same accounts. The company quickly learned which customers and potential customers were the most promising. Then, following a key acquisition to create the potential to slash manufacturing and shipping costs, the company directed marketing and sales efforts at the best potential customers for its cost and performance strengths versus competitors, and shifted production to more rationally exploit the narrowly focused needs that new customer base required. (Prior to these changes, the company had higher costs because of providing whatever anyone wanted, whether or not it could be done efficiently.) Then the business instantly turned around. If we test this company's changes relative to our eight steps, we'll find that the company probably reached no more than the fourth step during that first year. It learned the importance of new measurements and applied them to important marketing and manufacturing processes. It identified the potential future best practice--getting the right mix of customers and products for higher profit margins than their competitors would enjoy. It approached that potential future best practice and speeded up the results with an acquisition that fit the strategy. That is quite a lot to do in one year. The executives enjoyed the entire experience. The company didn't have to lay off anyone after that, though it had been laying off workers before it started in this new strategic direction. The senior executives all live far more rewarding and fulfilling lives today, as do many of the employees. Shareholders were ecstatic. Little information is available about the company's customers. However, imagine what the company could have done using all eight steps. It fell victim to one of the greatest afflictions that can affect an organization pursuing 2,000 percent solutions: It became so successful so quickly that it developed a complacency stall. Like the lizards on the other islands, after they successfully adapted to each new island, the rate of change quickly went back to the usual slow pace. The momentum of the brief spurt of adaptation caused prosperity to expand for some time to come, however, which decreased the incentive to adapt. You should apply stall-busting techniques to overcome the dangerous barrier of too much success too soon, and constantly re-create the environment most conducive to avoiding stalled thinking so that you can experience the exponential success that the 2,000 percent solution so readily provides . . . and can continue to provide with each repetition. Conclusion What, then, should be your goals for your organization? By now you should see that an organization is a way for all people to help each other lead more effective, challenging, rewarding, and balanced lives. By eliminating stalls, we can get on to the more important things in life, whatever they be for each organization and each individual. We do want to keep and build on all of the benefits of effective human cooperation in the process. Together, we can approach the theoretical best practices all around us and create exponential success not only now but also in generations to come, by preparing future generations to take on the proper mantle of focused searching for large opportunities to improve to near the theoretical-best-practice-level. You are now ready to start creating 2,000 percent solutions (if you have begun already--good for you!). Here are the questions you need to answer and consistently act on: What habits does your organization have now that could lead it to be derailed by success from creating a permanent 2,000 percent solution organizational culture? How can you introduce the 2,000 percent solution to overcome those habits? Who in your organization should you begin teaching about this process and how to overcome stalled thinking in order for you and the organization to get the most benefit from your learning? Where in your organization is the best process to use to begin using what you have learned? What are your organizational and personal objectives for helping others in your organization to use these ways of thinking? What are your personal objectives for the benefits you will enjoy as a result of overcoming stalled thinking and using the eight-step process outside of your work? We must each evolve into self-actualized individuals, who can recognize stalls and the stall mind-set, both personal and corporate, and then guide companies and organizations to overcome specific stalls to become self-actualized. We can use the eight-step stall-busting process to help us make that evolution occur much more rapidly as we pursue our opportunities to improve health, happiness, peace, and prosperity for all at a much faster pace. We, our loved ones, family, friends, neighbors, colleagues, those we serve, and descendants will be enormously glad we did. Quotes / Reviews || Excerpt || About Us || Speaking for You || Services || Buy the Book || Master Process || Stall Reports || Newsletter || Job Search || E-Mail a Friend || Contact Us || Mitchell On Tour || 2000 Percent Puns || Home Copyright 1999, 2000 Mitchell and Company Mitchell and Company Developed and maintained by Interactive Media Advertising Group, Inc.