Dumb Company

Two weeks ago I brought you CIRCUIT, "Corporate Intelligence Rating Calibration Under Inflationary Times", where, I'm sure, many of you (who work for, and run, intelligent companies gifted enough to recognize the genius you display as a regular reader of Sourcing Innovation) asked "Can a company really be that dumb?". The answer is, an unfortunate, yes. And in recessionary times, dumbness spreads like a disease. (Although it's a meaningless statistic, it is interesting to note that a search for "dumb company" in Google brings up 16 Million hits. That's almost Christina Aguilera level of popularity ... in fact, it's only dwarfed by the popularity of Britney Spears and the Circus she is due to unleash on the world on December 2.)

So today, helped by Google, I decided to bring you a starting list of other things that dumb companies do. Feel free to add your own in the comments, to help your fellow reader stay on the straight and narrow.

  • Brochure Mania
    As highlighted in this Remarkable Communication article, you can't afford to print 10,000 brochures and then dump 9,950 in a toilet. (And the environment can't afford it either!) If you feel you need a brochure, this there's neat little technology called word processing that can generate industry standard formats, like PDF, that every computer can read.
  • N-Tuple Opt-In Everyone who E-mails You
    Just because someone emails you to say they like, or don't like, your product, that doesn't mean they want to be added to every single e-mail list your company has.
  • Assuming all of your customers are hip 25 year-old caucasians who listen to i-Pods, drink Starbucks, and hug trees in their Gap outfits.
    Chances are the majority of your customers aren't who you think they are. In the enterprise space, assuming all of your customers run SAP and think it's the greatest gift to man since sliced bread isn't a great assumption either.
  • Lawyering Up ...
    And suing everybody who might be infringing one line of a 100-page patent that should never have been issued in the first place. Only money-grubbing lawyers win in patent wars. If you were smart, you'd lobby for the US to go the way of the EU and abolish software and business process patents. They're just stupid. There are laws for copyright. There are laws for espionage. There are laws for theft. Beyond that, if you can't compete fairly, maybe you shouldn't be competing at all.
  • Forgetting the Customer
    Maybe the customer doesn't know the best way to solve his problem, but he knows more about it than you do. Don't assume that only you can solve it, or that you know more about it than he does.
  • Forgetting Value
    Cost matters when money is tight, but so does value. If it sucks, it doesn't matter how cheap it is. Once word gets out it's a piece of trash, very few people will buy your product.
  • Cutting back on Customer Service
    When a customer is irate because you sold him something that doesn't work ... putting him on hold for hours or promising a solution "in next year's release" isn't going to win you any brownie points. It's going to make him look for an early exit from your relationship.
  • Forgetting Your Employees are People, not Chattle
    They're not resources to be reallocated, or liabilities to be released ... they're your dedicated employees who are there to help you through tough times.
  • Forgetting Sustainability
    You can always afford to go "green. Maybe you have to be creative. Maybe you have to do it in baby-steps. But you can always afford to go green.
  • ... and many, many more.

Now it's your turn. What are the dumbest things you had the opportunity to experience in the corporate world (and that led you on the path to your current job, where your intellect and dedication is appreciated). Alternatively, if you are among the unlucky few who joined a company that masterfully hid its ineptitude during the recent mini-boom, and that is now showing it's true colors (and causing you to search for a smarter company), what dumb things are you seeing?

 

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  • 11/21/2008 10:07 AM Institutionalized dumbness wrote:
    The dumbest ideas are often the very ideas we take for granted. Take the institutionalized "feast or famine" method of software pricing, for example, where:

    a) I get charged a huge up front payment, and I'm locked in for some lengthy period.
    b) I receive a 50 page SLA document that boils down to "unless Planet Earth stops spinning, there is no escape from the deal."
    c) I get charged a hefty annual maintenance fee.
    d) At renewal time, the vendor is back in my face wanting me to start all over with another huge payment, the excuse being some new and wonderful version of the software that I have to buy.

    When times are good, the feasts outperform the famines. When bad times last more than a year, this model falls apart, since customers who are cutting costs and are under the gun themselves are unwilling to pony up another huge tranche of cash for a renewal. The options are poor:

    1) cut prices deeply to try to keep the business (and annoy the hell out of the customer, who wonders why the price suddenly dropped, so what was he paying for before?)
    2) lose the business to a lower-priced competitor

    (1) is the only option, but it is not sustainable, so after a few months of this pain, vendors cut staff, try to raise money, put themselves up for sale, etc., all desperation moves that can be traced back to a fundamentally flawed business model.

    Microsoft perceived this problem, so a while back they floated the idea of pay-as-you-go pricing for their desktop software. We all hollered "Foul!" So they backed off. But they were right. Software isn't a product you buy off a shelf, it requires continual innovation to keep it useful and current. That's one of the reasons on-demand software pricing is finally starting to take off.

    Maybe everyone will internalize this lesson someday. In the meantime, for those who haven't, welcome to the famine!
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