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When an inflection point occurs, it splits companies into two groups: winners and losers. Netflix and Amazon belong to the first category, while Blockbuster, Toys “R” Us, and Gillette falls into the second. What’s the difference between the two? The ability to see that there’s a bend in the road before it’s too late.

An inflection point is a point of no return, when what was previously true no longer isThis dramatic shift may predict difficult times ahead, for an isolated company or an entire sectorTake the case of the French hearing aid industry, which experienced a painful inflection point in 2016 when several newcomers  including Darty  entered the marketThese competitors began to sell over-the-counter hearing assistance devices that were ten times less expensive than the existing productsAlthough the shift was abrupt, it did not come out of the blue: the regulatory, technological, and commercial conditionactually began to come together six years beforehand

This example illustrates the characteristics common to almost all inflection points: they are the product of a combination of independent events that aggregate over a long period of timemade up of a number of faint signals that, with a little technique, you can detect, understand, and use to your advantage 

 

Visit the periphery of your ecosystem 

Inflection points are usually detected at the edges of your organization: in your contact with customers, relations with suppliers, or in interactions with research organizations. It is unlikely that your board will be the first to spot the seeds of change. You, however, have to be able to see them in advance; otherwise there is a risk that you will be caught by surprise, miss an opening, or jump on an opportunity that doesn’t existSeveral avenues are open to you: you can schedule regular meetings between teams that are in contact with the outside world and teams that drive strategy and innovation; or you can entrust your people in the field with the resources to independently explore new ideaswithout the need to produce resultsAlternatively, you can foster diverse points of view so you are not confined to your usual frame of referenceIn the same vein, don’t reject outright what the doomandgloom merchants and other Cassandras might have to sayWho knows whether their dark predictions might hint at a future inflection point 

 

Imagine the future to understand the present  

 

Excerpt from Business Digest N°300, October 2019

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Point of view

Inflection points : pivotal moments when everything changes

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3 executives discuss how to spot - and act upon - inflection points

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