The story of what’s happened to Sears is interesting, perhaps not that unusual. The recent article in Fortune caught my eye because of Jim Collins, author of “From Good to Great”, and a lesser known “How the Mighty Fall” which applies here. Lately, it seems that these huge, untouchable brands….Kraft, Wells Fargo, GE are all examples of the once mighty. Most of the time what goes wrong is outside your pay grade…but some things are within your scope, no matter what your role is….
- ” Arrogance erodes discipline, and discipline is central to Collins’s analysis of decline. Cost discipline is often the first to go; it certainly went at Sears. ” To me, cost discipline is a symptom of paranoia…the good kind. Yes, there are reasons to invest. There are reasons why costs might rise. But almost all costs are manageable in some way. And if they aren’t, you can figure out a way to reduce expenses in another category. No one has a budget that has zero fat in it. The point is that letting costs rise complacently is frog soup….the heat’s slowly rising and that frog is staying put.
- “Success creates growth, which spawns bureaucracy, which subverts discipline. “The what replaces the why,” It’s inevitable that growth will create the need for processes…but process can’t become the end all. People hate bureaucracy because it usually is process without accommodating for variability or speed. But people also like process because they want to understand what steps are required to get something done. Some people like processes because it’s a power thing. That’s the balance: to have the right processes for consistency across a large organization (can you imagine everyone inventing their own way to do performance evaluations?) but not sacrificing efficiency and client focus. Think EZ pass…imagine if they made everyone go through the same lane…