How to Identify Business Tectonic Shifts

(With Alan Hald)

How to Identify Business Tectonic Shifts

Alan Hald is an inspiring and successful futurist. He co-founded and served as chairman and president of Micro Age, which he helped grow into a multi-billion dollar Fortune 500 company. He has an MBA from Harvard, with an emphasis in entrepreneurship, and he is the founder and manager of American Law Firm Funding. 

More than two decades ago, Alan was one of my advisors when I was a 25-year-old CEO of a publicly-traded SaaS company. In today’s episode, we are going to discuss Alan’s entrepreneurial journey and how he found success through identifying business tectonic shifts. 

Alan’s Entrepreneurial Journey

When Alan was newly married, he could not get a job for six months, so he and a friend followed their passion for future studies and started the Phoenix Chapter of The World Future Society in 1973. “The idea of passion is a strong motivator and extremely important to being effective and successful in business,” Alan said. “The key thing to me is to identify something you do have passion for.”

While Alan had a passion for futurism, he realized he also had to look for patterns in the marketplace if he wanted to prepare for his future as an entrepreneur and earn a living. 

“You really have to look at underlying patterns that might give you a hint as to how the world is changing and how new opportunities because of that might be created. In other words, you must change the way you look at the world by identifying patterns and then project those patterns into the future,” Alan said. 

In the early seventies, Alan watched the market and identified several patterns relating to social behaviors and technology creating unique emergent needs and capabilities which, as they converged in the near future, foresaw a business tectonic shift. The first pattern he noticed was the coming of age of baby boomers. This generational shift meant more people that were growth-oriented individuals were entering the workplace. Baby boomers wanted to work with others in society and were very involved in communication. That led Alan to notice the second shift of microelectronics. He did not quite know what it meant yet, but he knew microelectronics was changing everything. 

Alan saw the emergence of new, personalized communications capabilities enabling many-to-many communications which later became social media and near-instantaneous access to all information which he called the playground of information; today it is called Wikipedia. The enabling pattern catching his attention was the microtechnology revolution and the 1975 introduction of the personal microcomputer kit. It was a eureka moment, the dawning of the computer revolution and the information age, the birth of a new market, a tectonic shift that would transform the economy and society unlike any other.

Alan made a commitment to engage with those shifts and started a computer store with a business partner in 1976, the first computer store in Arizona called the Byte Shop, which became Micro Age. It grew 10 fold over the next three years, stumbled in the 1980-81 recession, recovered by 1983, and nearly doubled in size each year for nine years breaking $1 billion in 1992, which ultimately became a $6 billion company with 6,000 employees when Alan left the company in 1999. 

As entrepreneurs, we can follow a similar path as Alan. We can identify our passions and motivators, look for emerging patterns, and apply our current knowledge and skills to a new industry or opportunity. 

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Find Motivators 

Many times, we may hesitate to act on our ideas because we feel we have no resources, but really, we are lacking motivation and passion. 

“[Entrepreneurship] is not a resource-constrained activity. It’s a motivation constrained opportunity,” Alan said. “You may feel you can see an opportunity you know you can engage in, but if you don’t have the motivation to actually take action, it’s [just] an idea, and 20 years from now you will regret having never done it.”

What propels us to act on our ideas? Alan explained that passion is one of the greatest motivators. If we are passionate about our businesses and enjoy working every day, we will be more likely to pursue an idea and take advantage of an opportunity. Instead of pursuing something we hate, we should strive for opportunities we are passionate about. 

We do not need a lot of resources to make an idea successful. For example, Steve Jobs started Apple by building the first computer in his bedroom and garage. “[Success] doesn’t require a lot of resources. It requires a lot of motivation, and the ability to address failure and view it as an opportunity to succeed,” Alan said. 

For Alan, his motivation was his passion for involvement in dramatic business shifts and his desire to make a change in society. For others, their motivation could be providing for a family, a desire to innovate, to help others; Whatever the case, we need to find something that motivates us to act. Without action, our ideas will only remain ideas. 

Identify Emerging Patterns and Shifts

We should reexamine the world and see if we can find emerging trends and patterns around us that could create new tectonic shift opportunities, large or small, provided the endeavor can be self-sustaining as the market develops.

Alan created a billion-dollar company because he was able to identify and leverage patterns and tectonic shifts in the marketplace. He noticed the coming of age of baby boomers, a generational shift, and the trend towards microelectronics. Based on these two shifts, Alan took his background in business and started a computer store that eventually became a $6 billion company. 

I did something very similar with Adoption.com. I had some background with adoption, and then the Internet came out. I saw a tectonic shift that could help my business community if I put the two things together. I found a way to take the internet and leverage it to help the adoption community. When we are looking for tectonic shifts, we can take something that is transforming a different industry, and find a way to leverage that same shift to transform our industry. 

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The first step to identifying tectonic shifts is to consistently look for them. How do we change our mindsets so we can recognize them? The patterns are there, but it’s all about how we perceive the changes. The trick is to step out of our box and look at things differently. 

One of the key ways to find these tectonic shifts is to look at failures, problems, or challenges, and then flip them on their head and find the opportunity that exists in those challenges by finding and creating a solution. We do not need to find a shift that is earth-shattering and world-changing, but it needs to cause large transformations.

We can ask ourselves, “Is there a need that isn’t being met?” This could be a current need or an anticipated need.  It should impact a group of people, or even better, an entire industry. Once we recognize the needs, we need to do the research to understand them and find a solution we can offer. 

Apply Current Skills to New Projects

After we identify the shifts happening in the marketplace, we must act. 

“Once you see [patterns] you’re going to have to evaluate them in some way, but don’t be discouraged if you think you don’t have the skills or the experience or the understanding,” Alan said. “What you know now can be completely applied to something new in the future, if you only spend some time to understand how that works. Once you understand how something works, all kinds of traditional skills, experience, understanding, and knowledge can be reapplied to emerging future activities.”

Even though Alan knew nothing about computers or electronic kits, he used his passion and vision to drive him forward to act and pursue an idea he was not 100% sure about. Instead of sitting on his idea, he started to figure out how he could use his current knowledge to help him. 

“I really knew nothing about computers. I knew nothing about building computers, but I was excited about it, so I was open to learning,” Alan said. “I didn’t really have to create new skills. I had the skills ready; I just had to reapply it to how things were changing.”

Alan took the knowledge and skills he developed in growing a business and applied it to a new emerging industry to help propel him towards success. 

Key Takeaways

Thank you so much Alan for sharing your stories and insights with us today. Here are some of my key takeaways from this episode:

1. Sometimes we may hesitate to act on our ideas because we feel we are lacking resources, but really we are probably lacking motivation and passion. 

2. Passion is one of the greatest motivators. If we are passionate about our businesses we will be more likely to pursue an idea and take advantage of an opportunity.

3. We should look for underlying patterns and business tectonic shifts in the world and other industries that might give us a hint as to how the world is changing. 

4. One of the key ways to find these tectonic shifts is to look at the biggest failures, problems, and challenges, and then create a better solution.

5. We can take our current knowledge and skills and apply them to a new emerging industry to help propel us towards success. 

Connect with Alan

If you enjoyed this interview and want to learn more about Alan or connect with him, you can find him on LinkedIn.

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    About the author

    Nathan Gwilliam

    Nathan Gwilliam

    I help organizations navigate tectonic shifts that are transforming the business landscape, so they can optimize marketing, accelerate profits, and make a greater difference for good.

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