Thursday, December 17, 2009

Two Wrights and a Wrong


It is a dysfunction that makes it hard to see things or events that are close up.

The tendency for companies to have a myopic view of its products and services is a most common and natural thing. However, it is only when leaders explore and experiment with new ideas, do possibilities emerge. This is how you, as a leader, can keep your head out of the sand (or other dark places within your anatomy) in the midst of turbulent, technology-driven times.

But, was it really any different 106 years ago today?

When the wrighting was on the wall for the rail industry?

Striken with "myopia", they never saw the freight train coming through their tunnel vision.

On this day in 1903, two maverick brothers from Dayton, Ohio forever changed the rules for railways, blindsiding one of the most profitable industries of the day.

In his widely quoted article, "Marketing Myopia", first published in 1960, Theodore Levitt of Harvard argued that "the history of every dead and dying 'growth' industry shows a self-deceiving cycle of bountiful expansion and undetected decay." Professor Levitt pointed to the railroads as a prime example:

"Those behind the railroads are in trouble not because the need for passenger transportation has declined or even because cars, airplanes, and other modes of transport have filled that need. Rather, the industry is failing because those behind it assumed they were in the railroad business rather than the transportation business. They were railroad oriented instead of transportation oriented, product oriented instead of customer oriented".

Imagine how different things would have been had some smart rail executive traveled to Dayton and looked up the brothers who defied the law of gravity and conquered the wind on December 17, 1903, at Kitty Hawk, N.C. Who knows, Orville and Wilbur may have been willing to sell their technology (for the right price) and aviation would have looked very different today. You can be sure that if the rail barons could have seen themselves in the "transportation" business, 7-year old Emma would have been sharing a much different story with us.

When the Wright brothers finally realized their vision of powered human flight, they made the world a forever smaller place. It took another six years before they made their first dollar from the enterprise after a contract was signed with the U.S. Army who could "see" potential in the new technology.

But, what if the rail industry had seen that same "potential"?

And do you think for a minute things are different now with the way companies, their leaders and their people react to new technology?

History is one of your best guides to know how to navigate in changing times. Think of it as a laboratory where you test the consequences of thought. Those who never learn the lessons of history are doomed to repeat the same mistakes.

Sadly, "Marketing Myopia" still exists today as traditional industries such as newspapers, the Yellow Pages, record companies and Realtors continue to define themselves by the products and services they sell as opposed to the customers they serve. Nearly 50 years ago, Ted Levitt maintained an organisation must learn to think of itself not as producing goods or services, but as doing things that will make people want to do business with it.

It's a good question to ask.

Can you say with Orville and Wilbur precision, exactly, why are people doing business with you? Are you dead certain Ted Levitt and your customer would agree with you? If not, you might have a dying buisness on your hands and could be the last one to find out.

If rail was in the transportation business all along and didn't know it, when was the last time you seriosuly asked, "What business are we REALLY in"?

"Few will have the greatness to bend history itself; but each of us can work to change a small portion of events, and in the total of all those acts will be written the history of this generation"

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