Bangalore: Ian Thomas, a senior project manager and teaching faculty in a UK university says that he was once in charge of a building and rehabilitation project for a university, the building was completed with time to spare. Despite this the project ran over time, as the professors who were supposed to move to the new building were not ready to do so because they liked it in the old office. As ridicules as it may sound this is not just the case of one project, if a project manager or a change manager is asked about the most unreliable part of their project; they will tell that it is the people associated to it.

Same is true with business model innovation projects as well, even though the top management is well aware of the necessity of a change or innovation in their existing business plan, many a times they fail to initiate this project. They will put forth a zillion reasons for this but the real reason, so often will be their insecurity to move away from their comfort zone to venture into a new arena. Some will be worried about losing prominence or just does not like change, but the ultimate result is the same. Even more lethal is the situation where they half mindedly node for the inception of the project and will work round the clock, without realizing they are doing it, and make it difficult for the managers to go ahead with it, ultimately resulting in the failure of the project.

For a good part of last decade, Eastman Kodak has been in the news for all the wrong reasons, and what is it that the story of Kodak is teaching the business world? Starting from late 1800s to the late 1900s Kodak was one of the best known brands in the world. The company literally became the synonym of photography till 1980s. Then Fuji Film came to the U.S. market with better quality yet cheaper film roles and other players entered the market with better quality cameras. This obviously was a threat, and what did Kodak do? Nothing! The company believed that no Americans would prefer a non-American product over Kodak. Similarly when the first digital cameras came into the market Kodak was again not interested in the technology. Now, a couple of decades later, we all know what this misplaced belief of their brand name has led the company to.

This again, is not the story of one Kodak. This story has elements that are present in many of the companies that fail to initiate or complete a successful business model innovation. Many companies believe that their customers are utmost loyal to them and they expect a particular set of products and services from them, when the truth is very far from this. Sometimes, even when the change project is initiated, this mistaken brand identity disorder that the management team is suffering from will cause it to go into a direction that cannot have a positive end result for the company. What companies like Kodak fail to realize is that the brand identity or image ultimately comes down to the quality of the products and the services that the company is providing. A perfect example for this is nothing but Apple; studying how the company has redefined itself, its business model and created a new brand identity from the late 90s onwards should help them.

Also the evaluation of the financial prospects of the proposed change goes haywire quite often. What happens here is the mistake of using the same yardstick that is used to calculated alternative financial projections based on the existing business model. What they fail to understand is that the yardstick has to be tailored to fit into the changed environment and the changed structure of the new model. By failing to do so the company ends up having a majorly flawed financial projection that may stop them from implementing the apt business model or implementing the wrong one.

All these aspects have to be identified and dealt with before deciding on any change with business plan. The proposed change has to be clarified with all the concerned parties before given the go ahead and once decided on the course of action the management has to support it all the way through.