584
The most stupid business decisions in history
The clever and far-sighted decision leads to success, and that's stupid and short-sighted ... It is hard to imagine how devastating could it be - often companies with a market capitalization of hundreds of millions of dollars lost leadership or even disappeared from the scene in a matter of months only due to the fact that We developed a wrong strategy, or did not see the potential in some new product.
A source.
Decca and The Beatles: destroying vkusovschina.
In December 1961, the British manager of a major record label Decca went to Liverpool to listen to a local band play, created by four young men. It seemed to him that the guys have talent, and he invited the group to audition in London. In the capital, the group spent on the presentation to the studio boss for two hours, performing 15 songs. Then they went home - wait for a response.
Several weeks passed, and the answer did not come. Finally, the studio director Dick Rowe, personally present at the hearing, sent a letter to the manager of the group, saying that Decca not interested communities - they are too similar to the popular group The Shadows! In his letter, Rowe also said that Guitar Quartet - old form a rock band: there are almost none in the world and they soon die out completely. Needless to say that a group called The Beatles? Soon after these events "Fab Four" has signed a contract with the studio EMI Records, and a few years turned into the most popular pop band in the world. At the same time setting the "classical" form a rock band - Guitar Quartet.
Western Union Telegraph and Telephone: fatal shortsightedness
In 1876, the most advanced means of communication in the world was the telegraph, and a monopoly on its use in the United States belonged to Western Union Telegraph Company, which makes it one the richest and most powerful companies in the country. Capitalization of Western Union was huge at the time $ 41 million. As a successful inventor Alexander Graham Bell suggested that the company director William Orton buy his patent for a new invention, in which he has invested, the tycoon was struck by such impudence. Another would be: for a patent for some kind of "phone" daring investor asked for as much as $ 100 000.
Orton was so furious that he did not even talk to an upstart, however, being a gentleman, found it necessary to respond in writing to the inventor. "Mr. Bell - he wrote. - After a thorough examination of your invention, we came to the conclusion that although it is an interesting machine, he can not have any commercial application ... What is the use of the company can be electric toys? »
The irony was that in order to use the telephone, Western Union Telegraph did not have to build new networks: the phone can be connected to existing ones. Instead of continuing to pester, Alexander Graham Bell held a patent for himself, and after a few decades of its telephone company, renamed AT & T, has become the largest American corporation. A patent for an invention that could be sold for a measly $ 100,000, became the very expensive in the history of the patent.
I must say that after two years, Orton knew the depth of his mistake and spent millions of dollars in an attempt to take away from the Bell patent. Having lost the honor of a gentleman, even despised tycoon copyright laws and began to build their own telephone network, which then by the court were taken in favor of Bell.
Universal Studios and Mars: candy, which we choose
In 1981, Universal Studios Hollywood appealed to of Mars for permission to use the candy M & M's in the new film, on which the studio at the time worked. It was the usual practice of marketing - product placement and so-called cross-promotion: Candy helped promote the film, and the film helped to advertise candy. But Mars brothers refused: they did not like the story.
This was the famous "alien" by Steven Spielberg. Candy had to be involved in one the most memorable scenes of the film where the hero boy Elliot lures alien to the house with the help of sweet treats. Having failed in negotiations with Mars, the company Universal Studios has signed a deal with Hershey - and Elliot lures guests with a star candy Reese's Pieces. Sales of this new product Hershey at the time were very weak, but when the "alien" in a few days became superkassovym film, they literally exploded - in just two weeks they have tripled, and a few months after that continued to grow.
"It was one of the greatest in the history of marketing solutions, - said later director of Hershey Jack Trout, who personally approved the transaction. - If we were trying to achieve the same effect by other means of advertising, we would have to spend $ 15-20 million. "
Schlitz: beer suicide
In the 1970s, Schlitz was the second largest market after the brewer Budweiser. Race to the Top to the moment lasted for more than two decades - in 1957, Schlitz even managed to break into the Champions, but the advantage was short-lived.
At the end of 1970 the company decided to apply Budweiser hit by developing a simple winning strategy. Schlitz Analysts estimate that if the process is to reduce the cost of preparing and making the cycle shorter, it will be possible to sell more beer for less money to obtain the highest possible profit. As a result, Schlitz really managed to shorten the process of beverage production from 40 to 15 weeks, and most of the ingredients to substitute cheaper - for example, barley malt replace expensive budget corn syrup.
It would seem that the strategy to bear fruit: in the first weeks after the release of a new beer at odds with a bang, but then sales have fallen sharply - it turned out that the new horrible taste and very quickly turns into a muddy tasteless Voditsa. Also at the bottom of the empty cans remained disgusting sticky slurry, suggesting retailers to sad thoughts. As a result, Schlitz had to recall 10 million cans, and her reputation was dealt a blow from which the company and recovered.
In 1981, Schlitz closed the plant in Milwaukee, and the following year was bought by one of his younger rivals. The former mayor of Milwaukee, which took place in front of the collapse of the company, compared her death to the collapse of the "Titanic", to paraphrase the famous phrase: "How could such a huge business to leave to the bottom so fast!»
Ford Model T: narcissism as a recipe for disaster
When Henry Ford in 1908, brought to the market his famous Model T, the world already existed other cars. And some were even cheaper - but none of them was a such a combination of innovation and reliability. This Model T was obliged to its success. Over the next few years, the name only became cheaper, and it seemed that no one will press the company Ford.
By the mid-1920s began to show signs of the crisis: the fact that Ford took his creation as the perfection itself - he guarded Model T from any intervention in the design and technical equipment. In 1925, after more than 15 years after the appearance, she looked about the same as before: it was all the same outdated "bugs" with archaic transmission, high noise levels and a weak four-cylinder engine.
Aides and even competitors are advised to change the design of Henry Ford and the "innards" of the machine, but he continued to rest on our laurels. While competitors are not asleep: in 1923 the market share owned by Ford, was 57%, but by 1925 had fallen to 45%, and by 1926 th - to 34%. Competitors continued strong growth, and in 1927, Ford finally listened to the advice: announced that the model will be updated. But by the time Ford has already lost the battle - including the 1927 Chevrolet for the first time sold more cars than Ford. In 1929, the company managed to regain the top spot thanks to good sales of the new Model A, Chevrolet but again took the championship in the next year and never gave it to Ford.
A similar mistake now, it seems, does the company Apple, which is not the first year are strongly advised to increase the screen iPhone, but it is, unfortunately, turned a deaf ear to the advice. Many reputable shareholders lost faith in her and dispose of shares - such as Donald Trump.
Source:
A source.
Decca and The Beatles: destroying vkusovschina.
In December 1961, the British manager of a major record label Decca went to Liverpool to listen to a local band play, created by four young men. It seemed to him that the guys have talent, and he invited the group to audition in London. In the capital, the group spent on the presentation to the studio boss for two hours, performing 15 songs. Then they went home - wait for a response.
Several weeks passed, and the answer did not come. Finally, the studio director Dick Rowe, personally present at the hearing, sent a letter to the manager of the group, saying that Decca not interested communities - they are too similar to the popular group The Shadows! In his letter, Rowe also said that Guitar Quartet - old form a rock band: there are almost none in the world and they soon die out completely. Needless to say that a group called The Beatles? Soon after these events "Fab Four" has signed a contract with the studio EMI Records, and a few years turned into the most popular pop band in the world. At the same time setting the "classical" form a rock band - Guitar Quartet.
Western Union Telegraph and Telephone: fatal shortsightedness
In 1876, the most advanced means of communication in the world was the telegraph, and a monopoly on its use in the United States belonged to Western Union Telegraph Company, which makes it one the richest and most powerful companies in the country. Capitalization of Western Union was huge at the time $ 41 million. As a successful inventor Alexander Graham Bell suggested that the company director William Orton buy his patent for a new invention, in which he has invested, the tycoon was struck by such impudence. Another would be: for a patent for some kind of "phone" daring investor asked for as much as $ 100 000.
Orton was so furious that he did not even talk to an upstart, however, being a gentleman, found it necessary to respond in writing to the inventor. "Mr. Bell - he wrote. - After a thorough examination of your invention, we came to the conclusion that although it is an interesting machine, he can not have any commercial application ... What is the use of the company can be electric toys? »
The irony was that in order to use the telephone, Western Union Telegraph did not have to build new networks: the phone can be connected to existing ones. Instead of continuing to pester, Alexander Graham Bell held a patent for himself, and after a few decades of its telephone company, renamed AT & T, has become the largest American corporation. A patent for an invention that could be sold for a measly $ 100,000, became the very expensive in the history of the patent.
I must say that after two years, Orton knew the depth of his mistake and spent millions of dollars in an attempt to take away from the Bell patent. Having lost the honor of a gentleman, even despised tycoon copyright laws and began to build their own telephone network, which then by the court were taken in favor of Bell.
Universal Studios and Mars: candy, which we choose
In 1981, Universal Studios Hollywood appealed to of Mars for permission to use the candy M & M's in the new film, on which the studio at the time worked. It was the usual practice of marketing - product placement and so-called cross-promotion: Candy helped promote the film, and the film helped to advertise candy. But Mars brothers refused: they did not like the story.
This was the famous "alien" by Steven Spielberg. Candy had to be involved in one the most memorable scenes of the film where the hero boy Elliot lures alien to the house with the help of sweet treats. Having failed in negotiations with Mars, the company Universal Studios has signed a deal with Hershey - and Elliot lures guests with a star candy Reese's Pieces. Sales of this new product Hershey at the time were very weak, but when the "alien" in a few days became superkassovym film, they literally exploded - in just two weeks they have tripled, and a few months after that continued to grow.
"It was one of the greatest in the history of marketing solutions, - said later director of Hershey Jack Trout, who personally approved the transaction. - If we were trying to achieve the same effect by other means of advertising, we would have to spend $ 15-20 million. "
Schlitz: beer suicide
In the 1970s, Schlitz was the second largest market after the brewer Budweiser. Race to the Top to the moment lasted for more than two decades - in 1957, Schlitz even managed to break into the Champions, but the advantage was short-lived.
At the end of 1970 the company decided to apply Budweiser hit by developing a simple winning strategy. Schlitz Analysts estimate that if the process is to reduce the cost of preparing and making the cycle shorter, it will be possible to sell more beer for less money to obtain the highest possible profit. As a result, Schlitz really managed to shorten the process of beverage production from 40 to 15 weeks, and most of the ingredients to substitute cheaper - for example, barley malt replace expensive budget corn syrup.
It would seem that the strategy to bear fruit: in the first weeks after the release of a new beer at odds with a bang, but then sales have fallen sharply - it turned out that the new horrible taste and very quickly turns into a muddy tasteless Voditsa. Also at the bottom of the empty cans remained disgusting sticky slurry, suggesting retailers to sad thoughts. As a result, Schlitz had to recall 10 million cans, and her reputation was dealt a blow from which the company and recovered.
In 1981, Schlitz closed the plant in Milwaukee, and the following year was bought by one of his younger rivals. The former mayor of Milwaukee, which took place in front of the collapse of the company, compared her death to the collapse of the "Titanic", to paraphrase the famous phrase: "How could such a huge business to leave to the bottom so fast!»
Ford Model T: narcissism as a recipe for disaster
When Henry Ford in 1908, brought to the market his famous Model T, the world already existed other cars. And some were even cheaper - but none of them was a such a combination of innovation and reliability. This Model T was obliged to its success. Over the next few years, the name only became cheaper, and it seemed that no one will press the company Ford.
By the mid-1920s began to show signs of the crisis: the fact that Ford took his creation as the perfection itself - he guarded Model T from any intervention in the design and technical equipment. In 1925, after more than 15 years after the appearance, she looked about the same as before: it was all the same outdated "bugs" with archaic transmission, high noise levels and a weak four-cylinder engine.
Aides and even competitors are advised to change the design of Henry Ford and the "innards" of the machine, but he continued to rest on our laurels. While competitors are not asleep: in 1923 the market share owned by Ford, was 57%, but by 1925 had fallen to 45%, and by 1926 th - to 34%. Competitors continued strong growth, and in 1927, Ford finally listened to the advice: announced that the model will be updated. But by the time Ford has already lost the battle - including the 1927 Chevrolet for the first time sold more cars than Ford. In 1929, the company managed to regain the top spot thanks to good sales of the new Model A, Chevrolet but again took the championship in the next year and never gave it to Ford.
A similar mistake now, it seems, does the company Apple, which is not the first year are strongly advised to increase the screen iPhone, but it is, unfortunately, turned a deaf ear to the advice. Many reputable shareholders lost faith in her and dispose of shares - such as Donald Trump.
Source:
