The coal industry did not change for decade after decade. Being forced to improve safety demanded exhaust systems, better lighting, and a bit more, but nothing too dramatic. That industry long believed that arguments for cleaner energy were a fad. After a while it became clear that was a trend. But was that enough to require any real change? Would there be a seismic shift?
Yes. The current decade has hosted a seismic shift in the view of non-renewable sources of energy in general, and coal in particular. Yes, China and others continue to develop new coal mines, but China is also leading most of the world in bring renewable energy online. Yes, Europe will increase use of coal this winter due to the Russian war on Ukraine. But that shift is a short term necessity, not a new normal.
So if you owned a coal mine, when would you have shifted your business strategy? In the 2000s? Perhaps not even now.
Major players in oil and gas industries are both reacting to and creating a seismic shift in the supply of energy worldwide. The minor shifts are better management of methane; the major shifts are in creating new renewable capabilities.
It appears that in the 2030s, EVs will be the new normal. The seismic shift is well underway. Some auto companies have been on that train for a long time, focused on battery development; others are quickly moving that direction right now. Combustion engines will be around for a long time, but their time is largely over. Think coal 30-40 years ago.
Pelaton existed before Covid, but sales and service erupted from the ‘work from home’ and ‘stay within your bubble’ lifestyle shifts. That company announced plans to build a significant manufacturing plant in northwest Ohio. Ah, but staying out of gyms was not really the new normal. It was a temporary response to a pandemic. As sales plummeted, plans for new production were scuttled. Spending extensively on a new Pelaton was a trend, never to become a seismic shift.
Where is your business on the continuum of fad to trend to seismic shift to new normal? Do you observe trends, developing products and services to create a seismic shift in the market around those you believe are long lasting? Or do you wait until someone else creates and verifies the shift before investing in market and product development for the new market expectations?
Each of these strategic locations requires different competencies.
Include this positioning in your strategy, clearly define and master the competencies that are required to succeed there, continually verify if your position is best for the longer term, and adjust as needed.
Building an enduring manufacturing business requires commitment to the mission and constantly scanning the market to optimize your positioning strategy.