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Sunday, July 21, 2013

Why do Organisations Fail???

Few weeks back I was being interviewed - 'So if you need to give one most important reason for corporate failures, what that would be', one of the interviewer asked.  Without even thinking for a minute, I responded - 'Greed'.  I could observe an accepting smile on his face.  True.  In fact we were talking about the whole case of Satyam and Maytas, the corporate governance issues, the cooking-up of the accounting books, overstated size of employees, etc etc.

But after the interview was over, I wanted to ask myself whether it is only the Greed which is the cause of corporate failures or there are some more reasons.  I kept thinking of many reasons for the next week and thought of again going through the book by Jim Collins 'How the Mighty Fall' with the notes of 'Good to Great' as well as 'Built to Last'.  Apart from this browsing through some old magazines and searching out the failure stories (quite unconventional, generally people prefer going through success stories, I read one of the sayings of Abdul Kalam where he says it is important to go through failure stories than success stories which teaches you better lessons) and tried finding out of the web, some related literature.  Interestingly I came across a list of them which I would like to mention here:

Arrogance
Over confidence
Underestimating the rivals
Compromising on organizational philosophy
Doing too many things at the same time
High aspiration level in too short a time

the list goes on....  Can you people also help me in knowing some more reasons of failures?  Looking forward.... Most welcome....