2:00 PM, March 1, 2024

Navigating change in complex markets

Executive Education
| The European |

Senior-level executives, whether they lead multinationals, non-profits, SMEs or startups, are grappling with rising levels of complexity. In the face of emerging technologies, globalisation and changing consumer patterns, how can top-tier executives better leverage the opportunities and navigate the challenges in today’s fast-paced markets?

As Charles Darwin noted more than 200 years ago: “In the struggle for survival, the fittest win out at the expense of their rivals because they succeed in adapting themselves best to their environment.” For today’s global executives, this means enhancing their long-range vision and staying keenly attuned to market shifts, according to Ahmad Rahnema, Academic Director of IESE Business School’s Advanced Management Program (AMP). 

“Although to varying degrees, most industries are facing disruption,“ says Professor Rahnema, “this constant state of flux requires corporates strategists to boost their agility and ability to adapt to change. Those who rely on past wins or previous patterns as future predictors of success are putting their organisations at risk.”

Without a doubt, industry leaders that failed to adapt to changing surroundings offer a cautionary tale. Consider Blockbuster, which at its peak boasted a global network of 84,000 employees and more than 9,000 stores. By failing to respond to new competitive forces – in this case, video-on-demand and video rental kiosks – it was forced to declare bankruptcy after more than 30 years of operations. It also turned down the chance to acquire a small up-and-coming company called Netflix!

The case of Kodak also illustrates what happens when firms fail to adapt to disruptive market developments. After a  100-plus years in business, the photography giant embarked on a major restructuring in 2012, unable to effectively exploit its decades of worldwide dominion. The culprit? Its failure to recognise the tremendous potential of digital film technology, which oddly enough was invented by a Kodak engineer in the 1970s.

Hindsight is 20/20, as the saying goes, so what should today’s senior decision-makers do to identify and address potentially disruptive trends? Yolanda Serra, Managing Director of IESE’s International Open Programs, says continuously challenging underlying assumptions and beliefs is a good starting point. “Top-tier executives run the risk of ‘groupthink’ behaviours and tunnel vision that narrow their perspective and cause them to overlook shifts that could impact corporate performance. This can have multiple ramifications, from underestimating competitors to overlooking opportunities for value capture.”

In this regard, the example of Blockbuster and Netflix brings up another interesting point: unlike Blockbuster, Netflix has continued to adapt to changing conditions by keeping its pulse on the market and capitalising on new opportunities. Over the last 20 years, it has evolved from offering a DVD delivery service to a digital streaming platform, and more recently, to creating award-winning original content. Initially a disruptor, Netflix remains successful because it continues to disrupt itself.

Challenged by change 

Evolution and innovation, however, don’t emerge in a vacuum and, in the case of Netflix, it means being open to new ideas and paying equal amounts of attention to their core products and a corporate culture that keeps its pulse on the market. This ability to shift gears, however, sometimes poses a challenge for senior managers, particularly those with long tenures in the same company or industry, says Professor Rahnema.

“It’s easy for C-level executives to become siloed in their organisations or business circles, which is problematic because the best market solutions often emerge by leveraging diverse, multidisciplinary perspectives. It’s important for high-level executives to integrate these divergent viewpoints when formulating corporate strategy.”

In this regard, programmes like IESE’s Advanced Management Program (AMP) can prove transformative. Specifically designed for C-level executives, the AMP gathers general managers, company owners, country managers and senior directors with global oversight who seek to better navigate disruptive change and ambiguity. In a stimulating forum, they update their knowledge on the trends, concepts and shifts shaping global business, as well as reflect on their role as leaders. Ms Serra explains: “The AMP is designed for C-suite executives who want to break new ground and plan their future for the next 10 to 15 years. We target high-calibre executives from around 20 countries and 15 sectors who face similar challenges, yet bring dramatically different vantage points to the classroom. This interaction widens their outlook and changes how they approach business challenges.”

The programme accommodates executive schedules, with four residential modules delivered over a six-month span. This flexible structure limits time away from the office and enables participants to immediately apply actionable insights back at work.

“The AMP gave me a space to set my regular obligations aside and concentrate my energies on learning something new, says a recent AMP graduate. “It taught me to always question my underlying hypotheses and integrate all possible perspectives when making strategic decisions. In my view, this type of immersion is what generates such an incredible impact in such a short timeframe.”

While IESE faculty guide the learning journey, the programme offers numerous opportunities for peer-to-peer learning and networking. As Marc Sachon, Professor of Production, Technology and Operations Management, observes: “Teaching so many diverse and brilliant senior leaders is a lot like leading an orchestra. It’s the collision
of ideas, notes, sounds, instruments – it’s that wonderful cacophony of music when ideas collide.”

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