When devising business strategies for dealing with disruption, one might expect a company’s strengths to be clearly distinguishable from its weaknesses. But, that is not always the case. In certain situations, the distinction between strengths and weaknesses can be blurred. To illustrate, let’s examine some background and an example.
Companies often respond to disruption in a way that seems motivated by the fear of being left behind. Sometimes, this compels them to make major changes that do not reflect their strengths. Thus, they steer their organization into radically new areas where they are weak. Yet, since businesses succeed by building on strengths, these companies end up losing money—sometimes tons of money.
This kind of situation happened to bookseller Barnes and Noble as digital technology impacted its industry. Without digital strengths, Barnes and Noble was spending lavishly to develop its Nook e-book readers and to make attempts at keeping up with digital technology related to reading. At first, this approach seemed to be working, since Nook was initially successful. Not long afterward, however, as technology advanced, Barnes and Noble found itself incurring huge losses while essentially trying to compete with digital powerhouses like Apple. Barnes and Noble has since taken corrective steps, striving to tap outside resources rather than develop extensive e-reader technology on its own.
Yet, in the aftermath of such challenging circumstances, an important point should not be forgotten: every weakness can also be a strength, depending upon how and where it is used. That’s why the distinction between a company’s strengths and its weaknesses might be blurred. And, this can easily apply to what Barnes and Noble has encountered.
If e-book sales are leveling off, Barnes and Noble’s weaknesses on the digital selling side might actually be a strength for serving that portion of the book market which is not predisposed to buy or read digitally. And, emphasizing this market may be a realistic scenario in light of what a recent Wall Street Journal article (“What’s Barnes and Noble’s Survival Plan?” by Jeffrey A. Trachtenberg, April 18, 2014) said about the outlook for Barnes and Noble. According to the article, “There are some bright spots on the horizon. The growth of digital reading leveled off in 2013, and Barnes and Noble’s consumer stores generated better than expected Christmas results. Excluding Nook digital products, sales at stores open at least one year, a key economic indicator, declined only 0.5% in the quarter ended January 25, a sign of stabilization.”
This suggests that Barnes and Noble may have an opportunity to tap what had been perceived as a weakness and use it as a strength. Some consumers still buy books in retail stores. If the shift to digital reading is actually leveling off, Barnes and Noble is in a good position to understand, serve, and nurture that book buying market.
It is beyond the scope of this blog post to speculate about how long non-digital books will remain viable, and how long book retailing will have a place in the market. But, as long as books are still being sold in bookstores, and if e-reading may be leveling off, Barnes and Noble needs to think of its slowness to adopt book e-tailing as a strength, not merely as a weakness that erodes its prominence as a bookseller. This does not mean completely abandoning the digital side of the business. But, rather than being mired in a struggle to keep up with digital, Barnes and Noble needs to be more oriented toward the advantages it possesses in printed published products and in bricks and mortar book retailing. Furthermore, when it adds non-book items to its product mix, it should do so strategically. Unless and until hard copy books are completely disappearing, with no leveling off in sight, Barnes and Noble should not forget that every weakness can also be a strength—even in times of industry disruption.
