For the last few years it’s been a common refrain that the pace of change has been accelerating. Then along comes something like Covid-19 and reminds us that there’s “change” and then there’s “CHANGE”. What we are facing now is REAL change. Change that will have long lasting and deep implications for us all.
If we look specifically at the world we inhabit – business – the changes will be huge. Business models will be made and broken. Some companies will thrive, many will survive and an unfortunate number will fail. The ability to respond to this change is going to be a key factor in determining which group you end up in. As the quote attributed to Darwin goes: “It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is most adaptable to change.”
Intangible assets enable a business to change more rapidly. They are by definition light, mobile and scalable. That’s what enables their a) flexibility and b) drives their growth. This flexibility allows you to survive the storm (anyone remember Aesop’s The Oak and the Reed story?) and the growth enables you to accelerate when we come out the other end of this dark tunnel (and we *WILL* come out of this).
Two years ago EverEdge made the decision to “eat our own cooking” and ensure we were 100% intangible. We began will selling all our fixed assets, going paperless and only residing in offices where we could literally walk out of in 24 hours or less. At the time it was a tough decision and involved a lot of change to our behavior. But to be honest we’ve never looked back.
It also meant that when the calls came from the Australian and New Zealand governments this week to shut down, we implemented a work from home policy in less than 8 hours. Our Singapore office remains open as normal, albeit with very strict safety measures in place. If necessary we can close that office too and work uninterrupted.
Being an intangible asset firm means we can deliver for clients under virtually any conditions. If you need the work done, we can do it. In addition, having offices in three jurisdictions but integrated as a single entity means our response is seamless – we aren’t handing work between nominally identically branded but functionally separate entities. We’ve always looked at the requirements of the project we’re working on, and then brought together the right team to deliver the work. This has meant making full use of digital technology to conduct meetings and deliver work. Clients have always loved the flexibility and cost savings this offered as we could reduce travel costs while still ensuring we had the right people on the job, regardless of their location. It’s also allowed us to follow the sun, completing projects faster as we utilize cross-border teams. And that approach is benefiting our clients today as we continue to deliver for them, uninterrupted.
The world may feel like its titled on its axis but businesses and people are resilient and, as my favourite quote by Hannibal Barca (of the alps and elephant fame) goes, “we will find a way… or make one.”
So keep going – this will eventually pass and the future will belong to those who can adapt fastest to this changed environment. To that end: we’ve been talking to our clients about four things:
- Leverage & diversify away from the physical: Now more than ever, it’s important to identify and leverage your intangible assets more effectively. If you can’t ship products or services then why not ship intangible assets?
- Get ready to scale when the lights come back on: When the world comes back on line it will do so with a rush of pent up demand: physical assets simply cannot scale at the speed required but intangible asset based businesses can. Are you ready to scale those assets?
- Value is more than cashflow: Just because cashflow has collapsed doesn’t mean your technology or business is worth zero. If I had invented the cure for COVID-19 virus yesterday and hadn’t sold a single vial yet, would anyone really tell me it’s worth nothing? Your R&D, your innovations, your new product designs, your data, your software, your brand and networks – that’s where the true value is. The statement ‘cash is king’ is true, but intangibles are the future.
- There’s always value, even in a ship wreck: Don’t let the banks and accountants fool you: even if everything goes wrong and you end up on the rocks – if you’re careful, there is still value to salvage. In 2009 Nortel went bankrupt: all it’s physical assets were sold for $3.2B. The last assets to be sold were its patents, noted at $31M on the balance sheet. They were sold for $4.5B – more the entire rest of the company combined. There’s ALWAYS value there – you just need to find it.
In short, now is the time to rethink your business and re-imagine your future.