With most economic indicators suggesting that the Great Recession is coming to an end, it’s tempting for a business that has successfully weathered the storm to breathe a sigh of relief and look forward to business as usual. But experience tells us that complacency is the worst mistake a business — especially a startup — can make.
Just ask Digital Equipment Corporation (DEC), the precursor to Microsoft and Apple and creator of the minicomputer. By 1990, DEC was riding high, ranked only behind IBM in the computer industry. But under the leadership of Ken Olsen — who once famously derided the emerging personal computer, saying, “There is no reason for any individual to have a computer in his home” — DEC stuck with its original vision and its product lines, which were incompatible with emerging operating systems.
Related: Learning to Adapt Is the Key to Success
Olsen was removed from the board in 1995 and DEC was purchased by Compaq in 1998. By then, the company had lost money for five of its last seven years.
Complacent companies believe they have figured out the formula to success. In reality, there is no business as usual, no magic formula that leads to sustained high performance and financial success at companies. The long-term and repeated successes of high-performing companies are actually due to constant reinvention — their agility.
Most entrepreneurs start with a culture of agility and a commitment to be responsive to the changing needs of the clients/customers. But as organizations grow and evolve, much of that entrepreneurial daring is replaced with a dogged fixation on “The Plan” — or, in the other extreme, thrashing around in the face of crisis and trying to adapt with urgent, costly and often ineffective crisis management and organization restructuring.
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