Sunday, September 18, 2011

Are we spending time on yesterday that we should be spending on tomorrow?

       Peter Drucker, the famous business philosopher from the Claremont Colleges and the founder of the Harvard Business Review, had a signature strategy: abandon the past in favor of the future. He turned down chairs at both Harvard and Stanford, and went on to change business' ideas on management.

        In both fashion and marketing we see leaders who are stuck in their former glories. They got very good at what they were doing, made a lot of money doing it, and seem to have lost the creative spark to do something new. For example, Kodak was doing so well making photographic paper that they were late for the party of digital cameras and something that was a natural, printers.

        One concept of Drucker's that's even more difficult is "purposeful abandonment". Abandoning a stagnant product line appears to shrink sales, and along with it, profit. But managers hold on to older ideas too long, when they could be using their resources to foster new ones.

       One example on the good side is Toyota. Its founder, Sakichi Toyoda, was a successful inventor. He started his company by making a better loom for weaving, and got a patent on it in 1890. The company abandoned looms for cars and went on to global success.

       Part of Toyota's continued success is their firm's commitment to kaizen --- continuous improvement. Any employee is empowered to "stop the train" at any time at the sign of a problem, and start solving it. Today Toyota is rethinking all of its cars for North America.

       In fashion, "improvement" has to be constant. Nothing stands still. When Andrew Rosen, a founder of Theory, wanted to give fresh energy to a brand, he reached beyond the usual path of hiring a new designer. He made a deal with Belgian designer Olivier Theyskens to introduce his own line:  Theysken's Theory.

       Drucker's point is worth thinking about in our personal lives. What are the things and ideas you can purposefully abandon from your past?

       Please start now.


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