Saturday, January 21, 2006

Campanies age like dogs - quickly

Mostly a work day today catching up from last week’s travel. I did work out first thing though and did have lunch at my mom and dad’s. Flying out again tomorrow but will luck, I will be back Monday night in time for election results.

One concept that Bob Huang recently raised with me was the concept that company years are a lot like dog years. Companies age quickly.

What are the challenges of aging companies? They tend to not like new ideas. They tend to have high inertia. They tend to be slower. They tend not to try new things.

What are the advantages of aging? Wisdom and knowledge are the most obvious advantages. Companies know what works (and what does not) in their markets. Older companies also tend to have more resources.

Companies are like our bodies. We can do many things to help us stay younger. What is the nutrition and exercise of a company? What can we do to remain flexible? How can we get the best of both the new and the old? This is my challenge.

I think a large part of it is learning. For me, I study, study, study. While I study, I filter and synthesize new ideas. Just because a book says it, does not make it right for our circumstance now. Some of it can be training which just a subset of how we learn. I always look at my learning systems to see how I can learn more faster and easier.

Part of it is deliberately entering new areas. Deliberately taking risks. Well run older companies tend to have costs so well under control that they no longer take risks. Deliberately risking works for older companies. One of my mantras is “Fail often, fail fast and fail cheap”. If we are not making some errors, we need to risk more.

It is not only the fight to stay young, we need to use the wisdom and knowledge and advantages we have because we are older. We have many strengths – identify them and capitalize on them.

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