What makes companies crumble, the value of their shares decreases and their value is compromised? The board of directors is rushing to appoint consultants and specialists to find solutions?
As crisis managers, we turn to consultancy firms to fundamentally change the company, adjust its plans and objectives to become stronger in competition, but often do not pay attention to what happens inside, although the impact of internal problems is large, may be greater than external factors.
It is true that the external environment and its regulatory, logistical, competitive and continuous change in technology will have a significant impact on the company and its future plans. The study of these factors will result in increasing efficiency, enhancing the company’s strength in competition and thus raising the revenues and taking a significant percentage of the total value market.
But the administration does not stop there, and planning is not limited to that level.
The internal level also needs to be monitored, organized and sometimes structured, so that companies do not lose their connection and get back on track.
There are many reasons that internally weaken companies from mismanagement, clinging managers to leadership positions, and the exclusion of young talent, citing their lack of experience or great risk or marginalization for fear of competition, and take office in the future, and thus aging institutions; because the management is all from the first sponsor did not pay attention to training And the rehabilitation of a successor of young blood to receive these positions.
The absence of motivation between employees and the absence of a culture of creativity, and this leads to the departure of most minds with sophisticated ideas to competitors.
Internal conflicts between managers and departments The company loses the spirit of cooperation between its various departments and is based on individual efforts instead of working as a consistent break.
Because they did not develop or accept the application of creative ideas, but fought by managers in the meeting rooms and the Board of Directors in various ways, and rejected the application of new policies or even modify their product, Nokia, which was about twenty years ago, is trading between $ 31 and $ 32. Today, the share is worth about $ 5, leaving behind the legend of the mobile phone company, which refused to manage the change. The rise of its competitors .
In the event of an internal defect this slows down the company’s path and sends it to the unknown, but experts usually do not pay attention to this point. It often does not occur to them that the issue may be internal and does not require a change of strategy or look at changing the identity of the entire company internal.
The Kodak Empire
Kodak, 130 years old, was one of the largest and most profitable companies in the market with a high credit rating. It has accounted for more than 90 percent of all traditional images in the US market through the development of films, and the company has recorded fantastic profits from the sale of traditional cameras and the processing of films.
All this did not prevent her falling out when her management failed a great failure and suffered her death when she refused to enter the world of digital photography, thinking that the latter will not hold and will be just a whirlwind in a cup.
The funny thing about Kodak was that Kodak was one of the first companies to design the digital camera, but the management did not see much importance, did not develop the initial design, but neglected.
Kodak’s focus was on recording revenue by focusing on film-making, because this was the area that generated the most profit, but the winds of change changed completely depending on the development of films to extract images.
Kodak’s mistake was that it could not keep up with the sudden change in the camera market as quickly as the world moved to digital cameras, the movies were no longer useful, and it had an alternative to uploading images from computer programs, although the administration was aware that photography Digital will replace traditional photography and acidification of films, but they were intransigent and did not accept changing the course of the company or even focus on the development of digital cameras.
Sales fell a lot and the company’s shares plunged and its credit rating fell.
In 2005, when CEO Antonio Perez tried to change the culture at Kodak, he failed miserably. Peres was working alone in an administration that was not receptive to change, based on glorifying the past rather than keeping up with the future. In 2012, the company announced its bankruptcy. The New York Stock Exchange has asked for a suspension of the company’s shares; because it does not meet any investor turnout, the stock has no value. The Kodak empire, founded since 1883, and whose management was very proud of past historical achievements, World of Camera and Photos.
Jobs and survival instinct
In a recent interview with Steve Jobs and his question about being away from the company for years by John Scully, whom he had chosen to persuade him to join Apple at the time, Jobs did not know that the strong opponent was the one who would scold him from his company he built from scratch.
As opinions diverged and politics diverged, Jobs did not know that Scully would interfere in every big deal and would veto Jobs’s decision to move the company to another level. Jobs tried to overturn Sculley and expel him from the company in collaboration with the board, but Scully and his expertise turned the table on Jobs and the last one out of the company on a very long holiday then returned to reorient the company to its creative track after it deviated from the track and receded performance of the company.
In his interview Steve Jobs answered that Scully had a high survival instinct, which made him cling to the job and do the impossible to stay, although the decision to remove the person who founded the company and wanted to follow the footsteps of creativity.
Jobs has shortened management lessons and internal conflicts behind the scenes between managers and CEOs with the word “survival instinct.” The instinct of survival when it is greater than the interest of the company and all its shareholders, when it is greater than the company’s goals and future, You can get out of it.
Internal conflicts, power struggles, and survival often have a significant impact on the deterioration of the company’s conditions. Internal factors are more lethal than external factors and institutions may not be able to control them.
Sometimes the company may not need to change its strategy or identity, or even look for a new market and a different segment of consumers. Sometimes the company needs to minimize the survival instincts and to appoint a management that seeks change and is not afraid of its own destiny. And looking forward to the future.
Institutions are small countries
Institutions are small states in which positions are changed and coups occur, presidents and managers against each other, and ongoing conflicts generate conflicting methodologies and conflicting policies of interests all contribute to isolating the company from the market and the decline in performance.
To be strong from the outside you have to be strong from the inside. These conflicts and internal wars among managers all exhaust the company’s energy and leave it bankrupt, worn out and weak from the inside and make it lose the ability to see the future from the outside.
Bureaucracy, internal power struggles are one of the fiercest things an enterprise can go through, exhausting its internal strengths, weakening them, making it lose its ability to see right, or planning to reach its goals. Survival policy becomes a prevailing culture in the institution, and rooted in the behaviors existing in the workplace, you find the official follow the example of his managers after all the good competencies for the position, and try to marginalize so as not to highlight the achievements, because it is a threat to stay in office.
It may be the source of the problems from inside the meeting rooms and between the corridors of the company and the walls of the offices, especially if the situation needs a real change; a change that does not require specialists as much as it needs bright minds that erase old beliefs prevailing and reprogram the company to accept a new thought that allows it to breathe creativity and change , And thus continuity.
The article between the love of positions and ignore creative ideas .. Why Apple and failed “Kodak”? First appeared in Arabic Post – ArabicPost.net.