Business historian Richard Tedlow talks about denial
As a business historian, Richard Tedlow has studied just about every big business disaster in America....
"It’s hard to beat denial, because it’s comfortable. It’s everywhere, just everywhere," said Tedlow, a Harvard University Business School professor and the author of several business-related books.
His newest book — "Denial: Why Business Leaders Fail to Look Facts in the Face — And What to Do About It" — is to be released in March. In it, Tedlow explores the consequences of ignoring realities in an increasingly competitive and global marketplace.
"Today, we live in a much less-forgiving world," he said. "You can’t afford denial. You don’t have the cushion of days gone by."...
["]The most recent example is General Motors. Here is a company that for years was losing share point by share point. Finally, they went bankrupt. In the 1950s, when GM’s CEO was Time Magazine’s "Man of the Year," that would have been inconceivable.["]
["]But they lost sight of the customer. In the old days, people kept a car for three years. After the oil shock of the 1970s and stagflation, people kept their cars longer. It means the quality of the car you’re buying becomes far more important, so if Toyota is building quality automobiles that last longer, you’re going to migrate to that.["]
["]The dot-com implosion is another example, where companies were valued not by rock-solid metrics, like return-on-equity or profit, but rather share of eyeballs, with no sense of how to monetize it and convert it into profits. People weren’t asking those questions. And then, as if to show how little we learned, we fell right from that into a housing bubble. It crashed the whole economy. We’re still trying to work our way out of it["]....
Read entire article at Newark Star-Ledger
"It’s hard to beat denial, because it’s comfortable. It’s everywhere, just everywhere," said Tedlow, a Harvard University Business School professor and the author of several business-related books.
His newest book — "Denial: Why Business Leaders Fail to Look Facts in the Face — And What to Do About It" — is to be released in March. In it, Tedlow explores the consequences of ignoring realities in an increasingly competitive and global marketplace.
"Today, we live in a much less-forgiving world," he said. "You can’t afford denial. You don’t have the cushion of days gone by."...
["]The most recent example is General Motors. Here is a company that for years was losing share point by share point. Finally, they went bankrupt. In the 1950s, when GM’s CEO was Time Magazine’s "Man of the Year," that would have been inconceivable.["]
["]But they lost sight of the customer. In the old days, people kept a car for three years. After the oil shock of the 1970s and stagflation, people kept their cars longer. It means the quality of the car you’re buying becomes far more important, so if Toyota is building quality automobiles that last longer, you’re going to migrate to that.["]
["]The dot-com implosion is another example, where companies were valued not by rock-solid metrics, like return-on-equity or profit, but rather share of eyeballs, with no sense of how to monetize it and convert it into profits. People weren’t asking those questions. And then, as if to show how little we learned, we fell right from that into a housing bubble. It crashed the whole economy. We’re still trying to work our way out of it["]....