In the days gone by, companies died slowly. It took a long time. It also took a long time to establish companies, especially those that would create a global impact. Thus, you have companies that have been around for a hundred years. There is a company in Japan, which is a thousand years old!
Those were the days when cars, planes and trains moved at a much slower pace than they do now. Many of the old, respected companies we knew 50 years ago still exist, though they may not exist in their original form.
When I look back, I find that none of the three multinationals I worked for 60 years ago exists, though one exists in an amended form.
Times have changed. Now, 40% of the start-ups fail within the first few years. Chief executive officers (CEOs) are no longer permanent. Neither are managers who work on their teams.
And in extraordinary situations like the present COVID times, entire operations can come to a grinding halt- and perhaps, a sorrowful close—where even the lowest level worker is asked to go home!
What can one do now that was not required 50 years ago?
There is a need for clear goals for the company; it needs to know the competition well; it requires the ability and malleability to change with changing situations and fast; and it needs the leadership to work in a balanced manner to meet the needs of all levels of management and workers, as well as customers, and also suppliers and shareholders—so that you address every stakeholder.
If one does not do ALL this, then the company will die and disappear- as did Kodak, Blackberry and numerous others who are now just pages in corporate history.
I had never thought that a company like Yahoo would fail in the medium term.
On a visit to the Yahoo campus in California, I thought, “Here at last is an ideal company.” I was so impressed with the way the company was run.
My son Randhir worked for Yahoo at that time. One evening, he told me that he would be back late because the company had booked tickets for the entire department to go and watch the newly released “Star Wars”.
I was surprised. Is this commonly done? I asked him.
He said, "Yes—indeed every two months."
And every alternate Friday, the whole group goes to a pub for two hours, downing beer and engaging in banter. This is paid for by the company. They have Starbucks counters on every floor- and all the coffee you may drink is ‘on the house.’ They have a gym, a sauna, a swimming pool, and a running track on the premises—and one could take off for a swim even in the middle of the day, or a short spell at the gym, as some do!
Wives and children of employees are welcome to partake of lunch at subsidised fare on Fridays, at any of the four cuisine buffets on a 'eat as much as you can basis', and all non-alcoholic drinks are free. It was a sumptuous meal – for a token amount of money.
But Yahoo failed, and Pepsi succeeded—because in addition to looking after employee welfare, Yahoo was unable to adjust to a changing business environment and technology progress.
Therefore, they lost both- the ability to change to a relevant goal and the ability to adjust to customers’ evolving requirements.
Like Kodak and Blackberry, Yahoo stayed with their offering and business goals unchanged—while Pepsi moved on from just Pepsi aerated drinks to fruit juices and other products, including safe drinking water!
Pepsi was adjusting to the tide of opinion against aerated waters and their impact on health, especially youth.
That is how most people today have an email address of gmail.com – having moved from yahoo.com. And they carry an Apple phone or a Samsung.
They look for new offerings from Zara (though Spain was never known in the past for being in the forefront in the apparel fashions world)- which is making rapid strides in the clothing world, leaving earlier scions like Pierre Cardin far behind.
Sometimes, I wonder whether times had changed so much from 50 years ago when Henry Ford had the opportunity to see the competition from GM (General Motors) in his rearview mirror, and the company could at least belatedly change its attitude and fight and, therefore, still exists.
In the new world now—there seems to be no rearview mirror. Just the front windscreen, to look ahead and keep being alert and active to stay ahead. Companies need to be equally strong with all the four pillars to stand on, namely:
Customer orientation, innovation, understanding competition, and balanced management, including the goal of the common good.
(Walter Vieira is a Fellow of the Institute of Management Consultants of India (FIMC). He was a corporate executive for 14 years and pioneered marketing consulting in India in 1975. As a consultant, he has worked across the globe in four continents. He was the first Asian elected Chairman of ICMCI, the world apex body of 45 countries. He is the author of 16 books; a business columnist; visiting professor on marketing in the US, Europe and Asia. His latest books are "5 Gs of family Business" with Dr Mita Dixit and "Marketing in a Digital/ Data World" with Brian Almeida. He now spends most of the time in NGO work.)