Psychologist have tried to help us make sense of the way we deal with change. There are many different models of thought. One popular philosophy posits that we go through several phases when a change (or major life event) occurs:
• Shock – We aren’t ready for the change; it’s a surprise.
• Fear – We are now afraid of what this may mean to our world; we are scared.
• Acceptance – We’ve come to accept that now this new set of conditions is going to remain.
• Transformation – Now that we have accepted these changes, we have to adjust our perspective to fit this new reality.
Everybody goes through these phases at different speeds. And so does an organization.
Organization Changes in Response to Industry Changes and Pricing
The past 12 months seem to be one of adjustment and transition. Starting last year, the Fed began moving up the interest rate. At first it was a shock. There were small increases where there hadn’t been any for years. It was still too early to understand. But then the spigot opened, and the Fed continued to increase rates to a level not seen in years.
Fear creeped in and most institutions early on started to pull back promotional programs. The worry was of the unknown – were these rates going to continue going up, level off, or go down? Will we be competitive? Can we take some extra profit on the deposits we are keeping at these very low rates, or do we ride the rates up with the market and increase our market share?
Or we do nothing.
Now What?
Today, I believe much of the industry is in the acceptance phase. There is an understanding of what is happening, and the short-term effect. Most institutions have adjusted rates to meet the new levels. But there still seems to be a “pulling back” and a relaxation on outbound marketing and promotion.
Without marketing, the organization will shrink and lose potential share. We have been playing defense. It’s now time to go on the offense.
Transformation – Now is the Time.
It’s time to get your organization out of the acceptance phase and into the transformation phase. Embrace a forward-facing look.
What does transformation look like to you? It could be many of the following:
• Adjusting pricing in line with new realities
• Building new products and categories that reflect current pricing and market demand
• Adjustment of staff focus to line up with changing consumer needs and new realities
• Add/subtraction of staff/personnel in conjunction with changes in workload and overall demand
• Protecting your market share with confident advertising messaging and aspirational positioning
Until you get into the transformation zone and move forward, everything will still feel like a crisis.
The biggest danger is being comfortable staying where you are (in the acceptance zone), “waiting to see what happens next.” Or, hoping things will go back to the way it was. It never does.
In the meantime, others may be eating your lunch.