Key learning point: When business conditions change – taking action is important – but taking apropriate action is critical.
- The strengths that made your company successful provide the inertia that may prevent you from taking appropriate action!
- Why do good companies fail? — It is not paralysis, but rather the tendency to follow established patterns of behavior —- Active Inertia.
- The hallmarks of Active Inertia:
- Blinders – the Strategic frames and assumptions that led to success
- Routines – The way work gets done
- Shackles – the relationships that have developed with employees, customers, vendors, suppliers and shareholders
- Dogmas – the shared beliefs that have become the corporate culture
- Successful companies can avoid active inertia by asking …
- “What Hinders Us?” rather than “What Should We Do?”
- Respect your heritage, but recognize that the old strategic frames, processes, relationships and values need to be recast to meet the new challenges.
Excerpts from: Why Good Companies Go Bad — by Donald N. Sull, Harvard Business Review, July/August, 1999