Mark W. Johnson, co-founder and Senior Partner at Innosight: Some years ago, famed investor Warren Buffett told an interviewer that his approach to investing “is very much profiting from lack of change rather than from change. With Wrigley chewing gum, it’s the lack of change that appeals to me. I don’t think it’s going to be hurt by the internet. That’s the kind of business I like.”

Well, who wouldn’t like Wrigley — a company that’s been around since 1891, offering pretty much the same customer value proposition the whole time, and that was doing well enough after its first 100-plus years that Mars Corp. acquired it for $23 billion?

I’m not an investment adviser, and I would never second-guess Buffett if I was, but as someone who has spent a lot of time in the C-suites of publicly traded companies, I can attest that Wrigley is an exception that proves a much-different rule.

In today’s business environment, disruption and discontinuity may be the only constants. Product cycles are getting shorter and business models more ephemeral. In 1965, the average length of time a company remained in the S&P 500 was 33 years. By 1990, it was 20 years; in 2012 it was just 18. Based on the 2017 churn rate, it is forecast that fully half of the S&P 500 will be replaced over the next decade. According to our research at Innosight, half of the 39 companies that emerged onto the Fortune 500 over the last decade were business-model innovators.

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‘Every new business we’ve ever engaged in has initially been seen as a distraction by people externally, and sometimes even internally.’

Amazon.com CEO, Jeff Bezos

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Wall Street may prefer safe, stick-to-your-knitting strategies, but most companies find that to remain viable, they need to move past their core and adjacencies and venture into what’s known as “white spaces.” Remaining too close to home is actually a greater risk.

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