Thursday, October 13, 2011

It Is Not Paranoia If Someone Really Is Following You

I find it amazing how many times companies start as incredibly innovative and competitive juggernauts and how often they become sad shells of themselves.  Some say it is because they become too big or too complacent or too conservative or because the best people don’t want to work at big companies.  I believe it is a little bit of all of these things.

Andy Grove wrote a book in 1999 called Only the Paranoid Survive, in which he speaks about “Inflection Points” in companies.  I think the title could be a mantra for all businesses all the time.

Part of the reason entrepreneurs are successful is because they decide to do something different; they are willing to take risks and able to move quickly.  They are Davids fighting the mighty Goliaths of industry.   But over the last thirty years (and I am sure it was true before I began working), I have noticed that growth companies have huge difficulties maintaining the edge that got them where they are.

As they grow bigger, companies often don’t look realistically at themselves.  My first boss once told me "never believe your own press releases." By this he meant everyone markets themselves and tells people they are better than they are, but don't believe it yourself.  Many great companies start to believe their own press releases and fail to understand that they are only as great as their most recent product.

History is littered with great companies that felt they could never fail and basked in past glories—think of Control Data, Digital Equipment and Polaroid, or more recently look at what is happening at Kodak and Motorola.    All are amazing companies that failed to recognize that technology was passing them by. 

At the end of the day, what are the greatest causes of this failure?  I believe the most common are fear of failure, complacency and inability to remain nimble.

When a company is small and does not have money and salaries are low, it is easy to risk everything to unseat the big guy on the block.  The halls of startups are full of people in jeans and t-shirts working fourteen-hour days for little pay while the halls of large companies are full of well-dressed MBAs focused on advancing their careers.

When you are the big guy, all your time is spent trying to protect what you have.  Andy Grove and others argue this is why you must continue to challenge and innovate because there will always be someone trying to unseat you, but most of us are too afraid of failure or losing what we have to keep taking the type of risks necessary to stay on top.

You might think you are just a little guy so you don’t have to worry about this.  You are wrong.  If you don’t start building an attitude of paranoia driving innovation and excellence, then when you do get to be the Goliath it will be too late and the only thing you have to look forward to is a long downward spiral to the bottom.

A Post by Frank Vargas, Guest Blogger

No comments :

Post a Comment