Convergent and Divergent Times

Ever wonder when is the best time to converge (stick to their core competencies and improve on current products and/or services) and diverge (expand product offering, business operations, or processes)? This is a difficult question that has been a topic of debate for many years. However, recent studies and research projects have lead to some very useful conclusions in answering this question.

The first rule of thumb is that convergent behavior will always be followed by divergent behavior. The opposite is also true: divergent behavior will always be followed by convergent behavior. Observing the current trends of your business, competitors, and industry can greatly help in determining when you are shifting between these two behaviors.

The next important understanding is knowing why convergent and divergent behaviors occur. We live in a society where companies are awarded for creating and developing useful, innovative, and progressive products and services. This is essentially the definition of divergent behavior. There is an overarching trend to be divergent whenever possible. If that's the case, why do companies ever switch to convergent behavior? There are few reasons why this occurs: capital constraints, resource availability, and technological advancement. Money and equipment are the biggest obstacles. If you don't have the resources or the money to buy more resources, it is almost impossible to grow. Technological advancement is another big player. Some businesses are literally waiting for a technological breakthrough in order to diverge. Unless you have the resources for research and development, all you can do is wait. This isn't as bad as it sounds. You may lack control over the situation, but at the same so does everyone else. Everyone but the ones developing the technological advancement will be on the same playing field.

Lastly, we live in a global economy. All businesses are impacted by the activities of all other businesses in the world in one way or another. What may negatively affect a business in Australia may also negatively affect a business in the United States even if it does not seem like the effects follow a logical, linear progression. With the business world becoming more competitive, it is essential to diverge as much as possible without putting yourself at risk. Hopefully this insight will help you plan and prepare for the future.