Eddielogic

– Thoughts on Strategy and Management

The only one who really needs the ocelot, is the ocelot.

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Some businesses are like ocelots

This is a quote from the famous zoologist and animal film-maker Bernhard Grzimek. I liked this quote right from the beginning because it made me smile and it seemed to have the potential for a running gag.

I want to make one thing clear right from the beginning. I am sure the ocelot is an interesting animal and it surely has more functions in our ecosystem than just making other ocelots happy.

However, this ocelot some sort of analogy for me – an analogy for things that are just there, things that always have been there and that we are so used to that we don’t even realise that we could as well live without them. 

I learned that some businesses are more or less like ocelots. These businesses often have a long history. The do what they have always done, even improve what they are doing gradually, and they have a customer base. Ocelot businesses are not businesses in a crisis situation. However, ocelots are really endangered species. The most dangerous thing is that they don’t know it.

Let’s think about that. A business in a crisis knows about its crisis. Crises can be recognised by various signs like liquidity gaps, heavy losses, of sales breakdowns and so on. If a busi-ness experiences such signs of a crisis, it is forced to react in some way or the other. Some do the right thing and recover and some don’t. But this is a different story.

With ocelot businesses, the situation is different. There are no severe signs of a crisis – maybe some early warning signs but no more. Ocelot businesses are those who don’t realise that their business model is obsolete or is gradually becoming obsolete. Think of all the middlemen that have been cut out by clever new Internet businesses. Think of a local grocery store in a neighbourhood with already more than enough grocery stores and a large supermarket nearby.

They are still there and still have customers. However, the businesses are struggling because their product or service can now be obtained otherwise. Some of the customers would even miss them if they closed down. They don’t want to change their business partner even if there are better offers around. This may be out of habit or because they fear the trouble of switching. Nevertheless, those customers could as well switch to a different business partner or solution.

The fact that they don’t do it does not necessarily mean that there are strong barriers or a real customer lock-in. So the business is still there and will probably still be there next year. But like the ocelot that is only needed by the ocelot, the business is not longer there because it has something unique to offer which will be valued by the customers over time. It is just there because it is not yet gone.

So far this is not a serious problem. Many businesses lose their value proposition. If they realise this early enough they still have time to adjust their business model. The local travel agent with his high street-office may target elder citizens that are not computer-literate. The grocery store may refocus on organic produce and so on. So they literals regain their right to existence.

However, the businesses that I call ocelots are in danger because they feel safe. They may for instance experience a slow decline in turnover but do not see the sign. There have always been ups and downs in business so they still have hope for better times. These businesses ignore the fact that this slow decline in turnover is not a one-off event but is forming a steady trend over time.

Ocelot businesses don’t realise that their business partners could as well live without them (maybe not want to but definitely could). So they don’t feel the urge to do something against the upcoming danger – especially if the danger is not yet pressing and there still is time to react. Like ocelots they are happy with themselves and think everybody else is too.

The morale of my tale is:

If you go through a zoo or a wilderness with open eyes, you may discover an ocelot. It you go through our business world with open eyes, you may discover a different kind of ocelot too.

Or:

If you want your business to be more than a cute cat, check its ocelot-potential regularly.

Image source: https://pixabay.com/de/ozelot-tier-unze-zoo-628109/

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