Before my father became a minister he was in the office machine repair business. He worked for several firms over the years and at one time had a shop of his own. He lived during an era when craftsmanship was still a vocation. I’d watch him dismantle a manual typewriter or large crank-operated office calculator piece by piece and toss every spring, screw, bolt, and component into a large metal vat of degreaser. Each piece would plunk and clink into the vat, disappearing into the solution.
After a few hours he’d pull out each piece and reassemble the typewriter, with no parts left over! The machine gleaned like new and had that machine-oil fresh-from-the-factory smell.
One day I came home from school and dad was sitting at the kitchen table. Before him disassembled into many pieces was a brand new hand-held Texas Instruments digital calculator. With screwdriver in hand he looked at me and said, “This is what’s putting me out of business.” Today typewriters are nostalgic artifacts of a past era.
Industries do not usually “die” in a single dramatic moment. They weaken and diminish over years as technology, customer behavior, social conditions, cultural values, regulations, and capital flows shift elsewhere. Leaders who treat decline as a temporary slump often respond with denial, cost-cutting, and louder marketing and constant “rebranding.” Those moves can buy time, but they rarely create a future. Often it becomes a case in which mission loses prominence and the game is to stay in the game until it’s “game over.” A better approach is to read the signals early, tell the truth internally, and make disciplined strategic changes while the organization still has the resources and credibility to change.
How to Read the Signs of a Dying Industry
A dying industry or field is one in which the “rules of the game” are no longer relevant or effective. Demand may still exist to some extent, but the path to sustainable profitability, sustainability, and relevance is shrinking. In the midst of anxiety people look for the quick fix or the one thing that will turn things around. Leaders will do better to look for a *pattern* of indicators rather than focusing on any single metric.
1. Demand is not just down, it is shifting away.
Periodic dips and recessions reduce demand temporarily. Structural decline happens when customers and clients permanently change how they solve the problem your industry used to solve, or don’t find your product or services relevant any more. You may see this as younger customers choosing substitutes for what you offer, buyers changing procurement standards, or usage moving to a different field or model. People stop buying what you are selling because it no longer meets their needs or they can get it elsewhere cheaper and faster.
2. Margins erode even for the best in the business.
In healthy industries, top performers can protect margins through scale, brand, quality, or operational excellence. In structural decline, even excellent companies struggle to maintain margins because pricing has moved to substitutes or other platforms. For schools in higher education, witness the decline of on-campus four-year degrees and the proliferation of online programs and alternate pathways to professional development—like certificates rather than a degree or diploma.
3. Innovation happens outside your category.
If the most meaningful advances are being made by adjacent industries or new entrants to the field, your product may be turning into a commodity. Watch where talent goes. Watch where venture capital goes or where people are willing to spend their money. Watch where customers and clients find new solutions to challenges. In theological education, the steady growth of lifelong learning and continuing education programs is one indicator of where innovation is happening. It is the adjacent industry that is able to innovate faster, pivot quicker to demands, take risks, and experiment without the encumbrance of traditional, often obsolete, industry standards and regulations.
4. Capital becomes scarce and expensive.
When lenders and investors decide an industry’s cash flows are risky or shrinking, financing becomes more costly. Donor sources shrink, and you may see fewer new projects, shorter loan terms, and lower tolerance for risk. In religion, one indicator came when churches started having difficulty getting loans—a change from decades of confidence in the viability of local community-based churches. Soon, theological schools faced that challenge. As one loan officer said, “Theological education is not a growth industry.”
5. Consolidation accelerates, but the end does not improve.
Mergers are often framed as “synergies” and “strength,” but in a dying industry consolidation can be a last attempt to harvest cash and manage debt. It’s not a stretch to see that mergers have become the tactic for “staying in the game” for many theological schools. But when consolidation does not restore pricing power, promote innovative changes, or bring about growth, it may just concentrate decline.
6. The customer’s definition of value changes.
You might still deliver what you have always delivered, but customers now value speed, convenience, personalization, integration, or subscription pricing more than the traditional product features your industry is proud of. How often do parents question the value of a traditional college degree and the often crushing debt associated with that achievement? What savvy prospective seminarian does not question the return on investment of a three to four-year (or longer) theological degree with the realistic expectation of a minister’s salary?
When several of these are true at once, leaders should assume the industry will not bounce back “to normal.” The question becomes: “What is our best path through the transition?”
Two Historical Examples of Industry Decline
The fall of the U.S. newspaper industry
For much of the twentieth century, newspapers enjoyed strong local monopolies. Revenue came from a mix of subscriptions and advertising, including highly profitable classified ads. The decline did not begin because people stopped caring about news. It began because distribution and advertising changed.
Digital platforms made news abundant and immediate. Search and social media became the gateways to information. Most importantly, online marketplaces and social platforms absorbed classifieds and targeted advertising, undermining the economic engine that had funded traditional print reporting. Newspapers tried paywalls, layoffs, and digital editions, but many discovered that replacing print-era advertising margins was extremely difficult.
Leaders who survived tended to do three things: build digital subscription models early, specialize (local investigative reporting, niche business coverage), and restructure costs in ways that preserved the ability to produce differentiated journalism rather than simply shrinking quality along with expenses.
Kodak and the decline of photographic film
Kodak was synonymous with photography. The company even pioneered digital camera technology, but the film business was so profitable that leadership treated digital as a threat to be managed rather than a future to be built.
As digital cameras improved and then smartphones put cameras in every pocket, film’s value proposition collapsed for the mass market. Kodak attempted pivots, but it struggled to replace the scale and margins of film and printing. The lesson is not “Kodak missed the internet.” The lesson is that leaders can see the future and still be unable to act decisively when the current business model is emotionally and financially dominant.
Four Actions Leaders Must Take When Facing a Dying Industry
When an industry is declining, the goal is not to “save” the industry. The goal is to preserve the organization’s mission, people, and value creation by adapting to a new reality. These four actions provide a practical framework.
Name the decline clearly and establish shared reality
Denial is expensive. When leaders avoid the word “decline,” everyone else fills the vacuum with rumors, politics, paranoia, and false hope. A leader’s first job is to define the situation with clarity:
– What trends are structural versus cyclical?
– What would have to be true for the industry to recover, and how likely is that?
– If current trends continue, what is the five-year outlook?
Shared reality reduces anxiety because people can plan. It also protects decision-making from being hijacked by nostalgia or fear. This is not pessimism. It is disciplined honesty.
Separate “harvest” businesses from “build” businesses
In a declining industry, not all products or customer segments decline at the same rate. Leaders must segment the portfolio:
– Harvest zones: areas where you can generate cash reliably, even if growth is limited.
– Build zones: areas with credible growth, adjacency, or differentiation.
Harvest zones should be managed for cash, not for wishful growth. Build zones should receive investment, talent, and executive attention. Many organizations fail by treating everything as a build zone, spreading resources too thin, or by treating everything as harvest, starving the future.
Here’s a simple test: If we did not already own this business, would we buy it today at its current price and outlook? Would we start this enterprise today given the current conditions and future outlook? If the answer is no, manage it accordingly.
Make a deliberate pivot strategy with time-bound risks
Pivots fail when they are vague. “We’re going digital” is not a strategy. A pivot strategy should specify:
– The new customer problem you will solve.
– The capabilities you must build or acquire.
– The economic model (pricing, margin expectations, distribution).
– The milestones that will prove the pivot is working.
Because your current business is shrinking, time is not neutral. Leaders should place a small set of bold, time-bound risks and review them ruthlessly. Some risks will fail. That is normal. What is not acceptable is drifting, endlessly “piloting” without deciding.
Maintain trust while redesigning the organization for the next era
Decline puts pressure on people, especially those committed and loyal to the way things were and are. Leaders must maintain trust while making hard choices. That means:
– Communicating early and often, with consistency.
– Explaining tradeoffs and the criteria and rationale for decisions.
– Investing in reskilling and redeployment where possible.
– Making layoffs and closures humane, transparent, and decisive when necessary.
At the same time, the organization’s structure must match the future, not the past. If the next era requires software talent, partnerships, a subscription model, or increasing resourcing an industry adjacent growing area, then incentives, leadership roles, and operating rhythms must reflect that quickly.
A dying industry is not a verdict on the worth of the work. It is a shift in the environment. Leaders who succeed are not those who cling hardest to what was, but those who read the signals, tell the truth, and act with courage while there is still room to maneuver. Decline can become an era of renewal if leaders treat it as a strategic transition, an opportunity for innovation, instead of a public-relations problem. Rebranding will not save and industry; strategic innovation will.
