Don’t Outsmart Yourself

Attached is an excellent article that gets at the essence of why some companies continuously innovate  with great success, and why others fail and go out of business.  Regarding the latter, I’ve had the enlightening experience of being hired by two companies as part of turn-around initiatives.  Both were well-known corporations with strong brand equities, yet were doomed to failure under the prior regimes.

As discussed in the article, upon arriving at these companies it was apparent that key players still believed that only they knew what was right for the company.  All this despite they’re lack of ability to “right the ship” and their obvious contributions to the companies’ demise.  In the end, I think that the following were the culprits:

1.  Keeping key management in the same position too long.  This can be a real killer, especially if the key players aren’t naturally inquisitive people willing or capable of understanding broader market trends and considering 360-degree input.  Eventually, the same strategies are deployed, unhealthy loyalties develop and the business continues to operate in the same predictable way.  The market changes, the competition changes, and consumer interests change, all while the company stays the same.

2.  Always looking internally for the right answers.  This is the essence of the attached article.  People think they’re too smart, or are too proud, to consider alternative approaches to a problem.  IBM encountered this before the Gershner turnaround as have many former market leaders.  This tends to be especially true with technology driven firms.

3.  A culture of “yes-men”.  Command and control is important for C-level team members, and strong personalities are the rule for people who rise to senior management.  However, this can become a disaster if senior managers surround themselves with people unwilling to provide a well-rounded, objective perspective about the realities facing the business.  In this scenario, objective market research is rebuked as flawed and biased, with the methodologies questioned rather than accepting an opposing perspective.

Getting the best and most complete information, then distilling a situation down to key business drivers is a hallmark of successful leaders.  Carly Fiorina focuses on this success-trait in one of my earlier posts.   Blogging Innovation: Innovation at TEDx NASA .


One response to “Don’t Outsmart Yourself

  1. Adriano Allegrini

    Could not agree more … Group thinking and a yes-men culture are sure-fire formulae to nip innovation in the bud.
    Great article, Carlos

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