It would be difficult to read the preface of Jim Collin’s book, How the Mighty Fall, without associating it with the principles of truth and grace. Without truth, acts that are meant to be gracious produce serious negative consequences by ignoring underlying problem. Regrettably, these consequences are more severe than the would-be consequences of veracity. When truth and grace are used in conjunction with each other, difficult problems are resolved, enabling the reformed party to flourish and achieve success. Collin’s utilizes the principles of truth and grace by presenting analysis, grounded in fact-based research, on how the greatest of companies meet their bitter end. In doing so, he hopes that leaders will learn from these cases and apply
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Consequences of the previous missteps are felt within the company and the leadership must respond. Instead of responding by returning to discipline and focus, companies most often seek out a quick fix. This stage is marked by (1) a series of silver bullets creating inconsistency, (2) grasping for a leader-as-savior, (3) panic and haste, (4) radical change and revolution with fanfare, (5) hype precedes results, (6) initial upswing followed by disappointment, (7) confusion and cynicism, (8) chronic reconstructing and erosion of financial strength. Hewlett Packard displayed the “leader-as-savior” marker in 1999, when CEO Platt was accused of failing the company. He was replaced with Carly Fiorina, the “supersaleswoman” according to Forbes. She was a charismatic visionary. Her inspiring speeches presented promises of radical change and innovation. She was “in a hurry,” looking for quick fixes that brought inconsistent results and ending her tenure as CEO in six short years. Panic produces ill informed practices, such as in the Addressograph Corporation. In response to competition, the once leader in office duplicating machines, launched 23 new products in only three years. As 16 of the products failed, Addressograph lost control of their finances. New leadership was brought in, promoting a complete transformation of the company. In less than a year, their strategy eliminated almost all of their …show more content…
The case of Zenith Corporation is a perfect example of this principle. The company rose to greatness under Eugene McDonald, creating portable radios and entering the television market in its early days. But Zenith moved through the four stages with unprecedented speed. Im stage one, they ignored competition due to hubris. In stage two, the thirst for growth doubled their debt-to-equity ratio. In stage three, they externalized blame and took on more debt to lower prices for greater market share. In stage four, they sought salvation in adopting a high volume of new projects, again raising their debt-to-equity ratio to 140 percent. Amazingly, Zenith made a surprising recovery under their new CEO, Jerry Pearlman. He was setting up Zenith to become a leader in the personal laptop market. Regrettably, the accumulated effects of stages one through four drained Zenith’s cash load. With no cash, no amount of genius could help Pearlman save the company. He met with Bull Cooperation and agreed to a
Consequences of the previous missteps are felt within the company and the leadership must respond. Instead of responding by returning to discipline and focus, companies most often seek out a quick fix. This stage is marked by (1) a series of silver bullets creating inconsistency, (2) grasping for a leader-as-savior, (3) panic and haste, (4) radical change and revolution with fanfare, (5) hype precedes results, (6) initial upswing followed by disappointment, (7) confusion and cynicism, (8) chronic reconstructing and erosion of financial strength. Hewlett Packard displayed the “leader-as-savior” marker in 1999, when CEO Platt was accused of failing the company. He was replaced with Carly Fiorina, the “supersaleswoman” according to Forbes. She was a charismatic visionary. Her inspiring speeches presented promises of radical change and innovation. She was “in a hurry,” looking for quick fixes that brought inconsistent results and ending her tenure as CEO in six short years. Panic produces ill informed practices, such as in the Addressograph Corporation. In response to competition, the once leader in office duplicating machines, launched 23 new products in only three years. As 16 of the products failed, Addressograph lost control of their finances. New leadership was brought in, promoting a complete transformation of the company. In less than a year, their strategy eliminated almost all of their …show more content…
The case of Zenith Corporation is a perfect example of this principle. The company rose to greatness under Eugene McDonald, creating portable radios and entering the television market in its early days. But Zenith moved through the four stages with unprecedented speed. Im stage one, they ignored competition due to hubris. In stage two, the thirst for growth doubled their debt-to-equity ratio. In stage three, they externalized blame and took on more debt to lower prices for greater market share. In stage four, they sought salvation in adopting a high volume of new projects, again raising their debt-to-equity ratio to 140 percent. Amazingly, Zenith made a surprising recovery under their new CEO, Jerry Pearlman. He was setting up Zenith to become a leader in the personal laptop market. Regrettably, the accumulated effects of stages one through four drained Zenith’s cash load. With no cash, no amount of genius could help Pearlman save the company. He met with Bull Cooperation and agreed to a