This article is a continuation of the discussion I started in It’s All About the Future where I describe a few principles of leadership based on the bestselling book The Ride of a Lifetime by Disney’s former CEO Bob Iger, and my own book The Exponential Era. In the first article, I talked about the importance of establishing priorities, and how strategic planning needs to evolve from a painstaking, slow, overly analytical process, to one that is much more dynamic and agile.

This time I would like to turn your attention to the topic of innovation which Bob Iger discussed brilliantly in Chapter 12 titled If You Don’t Innovate You Die. In the chapter, Bob talks about how he came to the realization that Disney needed to deliver their content in new and modern ways, on their own technology platforms.

This resonated with me. At iLumina Tech, we provide digital technology solutions with a vertical focus on sports. Sports is the most engaging content that there is — nothing captures the human spirit and the emotions associated with victory and defeat like the world of sports. This emotion, when shared with fans that cheer for the same team, strengthens our sense of belonging and nurtures our need to socially connect with others.

“The best thing about sports is the sense of community and shared emotion it can create.”

Bob Costas

When you combine the power of the most engaging content on the planet with digital technologies, you build an explosive growth opportunity for the content owners unlike any other. This is the secret sauce behind companies like Netflix, Facebook, and Disney, and that is why I believe these new technology platforms have the potential to exponentially grow our clients’ businesses.

Yet, I find many organizations in the sports industry still struggling with the exact same issues that Bob Iger had to contend with as the CEO of Disney. The business of a sports organization is very similar to Disney’s business — it’s all about creating engaging, high quality content, leveraging technology to its fullest extent, and distributing this content globally — the exact three strategic priorities discussed in the previous article.

The challenge is that sports industry leaders need to make the very difficult decision to cannibalize still-profitable businesses in order to invest in the future. Many sports organizations are still comfortable licensing their content to third parties to only capture a fraction of the value of engaged fans, instead of offering content on their own platforms in order to drive 10X growth. When I see sports organizations streaming live games on third party platforms, I wonder if they realize how much revenues they are giving up by not having the games streaming in their own application, capturing data about their fans, and marketing directly to them.

Here is how Bob Iger put it when he was struggling with the same difficult decision: “Could we find the technology we needed to accomplish that and be at the forefront of change rather than simply being undone by it? Did we have the stomach to start cannibalizing our own still-profitable businesses in order to begin building a new model? Could we disrupt ourselves, and would Wall Street tolerate the losses that we would inevitably incur as we tried to truly modernize and transform the company?”

It takes a very strong leader to have the courage to go in front of the board and tell them that the choices on the table are to either get out of the comfort zone and take some short-term losses that will lead to a bright future, or to die a slow death. Under Bob’s leadership, Disney made the right decision, described in this excerpt from the book:

“We were now fully committed to also becoming a distributor of our own content, straight to consumers, without intermediaries. In essence, we were now hastening the disruption of our own businesses, and the short-term losses were going to be significant. (As one example, pulling all of our TV shows and movies — including Pixar and Marvel and Star Wars — from Netflix’s platform and consolidating them all under our own subscription service would mean sacrificing hundreds of millions of dollars in licensing fees.)”

Bob understood that he only had two choices: innovate or die. He knew what needed to be done and he articulated the problem skillfully when he addressed the board:

“I know why companies fail to innovate. It’s tradition. Tradition generates so much friction, every step of the way.”

Every sports organization today is at a crossroads. They need to make the courageous decision to distribute their own content, straight to consumers, without intermediaries, just like Disney did. The alternative is to stay behind the exponential curve, and potentially never recover from it. It is my wish that every sports organization, just like Disney, will be so lucky as to have a leader like Bob Iger, with the vision, conviction and courage that is required to succeed in the Exponential Era.

You can learn more about The Exponential Era at: https://TheExponentialEraBook.com/

You can get both books from Amazon through the links below:

The Ride of a Lifetime

The Exponential Era

To learn more about digital technology solutions for sports organizations, see the following:

iLumina Tech

Digital Technology Entrepreneur, Strategist and Advisor Helping Organizations Stay Ahead of the Curve in the Exponential Era