A Reason Organizations Fail

Thomas McQuade and Chidem Kurdas have a nice post at ThinkMarkets called Understanding Markets: Point/Counter-Point.  I’m sucker for points and counter-points.  I love that stuff. I don’t think we have enough of it in our society.

Though, in this case I found the title misleading.  I think the two had good things to write about markets, but I’m not sure it deserves the title.  Both authors admitted in the comments that their points were complementary, rather than counter.

Regardless, I found one nugget that struck a chord from Chidem’s part of the post:

Political powers-that-be controlled economic activity and did not leave scope for much innovation—indeed often punished innovators.

This struck a chord with me because I’ve seen this first hand in business.  I’ve watched good businesses lose ground because they came under the control of people who desired political power and suffered from the fatal conceit in believing they can take the business to the “next” level with their great ideas and careful guidance.

What they actually do is run the business for their own benefit and try out a narrow range of ideas — most of which are their own.  They ignore the true engine of innovation that could take the business to the next level — trial and error experimentation, lots of it.  Several years down the road, competition, where the true trial-and-error is takes place begins to take its toll.

I imagine this can be true for many other organizations.  Education seems to struggle with this.  Charities seem to struggle with this.  Government entities definitely struggle with it. Churches struggle with it.  Homeowners associations struggle with it.

This isn’t be surprising, since all organizations are manned by people.