Monday, October 20, 2008

Building a long term business?

A technology pundit noted that "We live in an era when nothing can be built to last. Everything is in flux; nothing can sustain."

Initially this would appear to be true. If you look at the Fortune 500, of the 500 that appeared on the first list in 1955, only 71 are still there, on the list that is. Some of the biggies that disappeared from that list are well know to you, like Scott Paper, Zenith, Rubbermaid, Chrysler, Teledyne, Warner Lambert, and Bethlehem Steel. Some died, some just gave up their independence. There are though those who have persisted; consider GE which has been around for over 100 years, or P&G which started before the American Civil War and continues to succeed; as does Johnson & Johnson whose roots were planted back in 1886. Then there's Nucor Steel who rose from near bankruptcy to the 151 spot on the Fortune 500 list or Xerox which turned over profits of over $1 billion in 2007, a mere seven years after suffering losses of over $300 million.

So what is at the root of long-term success and how do you build a company that will go the distance?

I think the key is self-afflicted abuse. It is not what the world does to you but what you do to the world. In the end it is you, the entrepreneur and with growth big-time business persona that is at the core of long term success. You get your start as a leader, people follow for all the reasons that leaders lead and followers follow. When this relationship malfunctions the game is over. Inertia and management may keep the company going but not necessarily growing. And you become jetsam to the company. Unless another leader comes along your baby, the company will die of attrition.

Harsh reality - you must lead or die.

Barry Thornton, Technology and Marketing Guy

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