Ten Companies That Will Never Recover from their Mistakes

Posted by Ian Cooper - Thursday, November 4th, 2010

From 24 / 7 Wall Street:

"Most companies that fail over time do so because of a series of modest mistakes made by generations of management. Markets shift and corporations are slow to adapt. Strategic acquisitions, which could change a company’s future for the better, are ignored or passed up. And, perhaps most common of all, a company begins to decline because it loses the creative spark of its founder or the input of employees that are the company’s creative engine.

The firms on the 24/7 Wall St. list of companies that will never recover from their mistakes are all still in business.  Each firm was a leader in its industry, if not the leader, but made a critical error or errors that destroyed their chance to have a brighter future.

For want of a nail, the kingdom was lost.

Motorola did not produce a product that leveraged the huge success of its RAZR handset, a product that propelled the company to the No.2 position among cellphone manufacturers worldwide. Boston Scientific decided that it was not enough to be a large and highly successful company. Instead, it bought another company to be even larger. Blockbuster believed that video rental stores would remain the dominant way to distribute DVDs. It did not see that the DVD industry was faltering.

It is easy to say that good management never makes disastrous strategic errors. But, the results of good management may be, in part, a product of luck. GM’s prospects fell apart while rivals VW and Toyota did well. Did GM fail to see something on the horizon that its rivals did? Or was GM unlucky because its home base was the US where the labor movement was powerful and heavy cars with large engines sold well?

There are ten companies on this list. The fortunes of each have been badly damaged. Whatever the reason, what each lost is irretrievable."

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