Business Opportunities Weblog

Why Smart Companies Do Dumb Things

By on October 6, 2006 in Ideas


Guy Kawasaki:

Not a day goes by when I don’t ask myself, “Why do smart companies do such dumb things?�

When smart people assemble in companies, they are still capable of doing dumb, if not even dumber, things. Wouldn’t you think that groups would provide checks and balances?

Why smart companies do dumb things:

* Consensus. When it comes to doing dumb things, the sum of the parts is less than the whole.

* Conviction. Consensus rears its ugly head during the decision-making process.

* CEOs. There is one kind of consensus that is particularly powerful and dangerous: a CEO (or any top executive) who provides cues about what she likes.

* Experts. If there’s anything smart people worship it’s other smart people.

* Good news. A company, any company, is constantly assaulted by its competition, customers, governments, and schmexperts (schmucks + experts).

* Lofty ends. Lofty ends can justify all sorts of weird and inappropriate means.

* Budgets. Ideas take on a life of their own in the form of convictions.

* Greed. You’ve heard of concept of “good to great� by Jim Collins. There’s also “good to greedy,� and greed usually trumps intelligence.

* Arrogance. This is greed’s twin brother. Arrogance sets in when a company claims success as if it’s a God-given right.

Photo by wagg66.

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Rich Whittle has added 6,226 posts to Business Opportunities Weblog.

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  • http://pet-comfort-products.com John Rhodes

    There are conscious reasons and unconscious reasons. I’m much more interested in the conscious reasons. I’m always intersted when people deliberately do stupid things. It means that a person has made an effort to do something dumb. WHY?

    I worked for a company a few years ago that was guided by an evil man. I don’t say this lightly. He was a complete liar. He was also the president. This meant that many people did stupid things to make him happy and to avoid getting fired. They were dumb on purpose.

    This provides one answer. People do stupid things because of fear. Since people drive a company, companies do stupid things because of fear. One man can make an entire company stupid.

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