Thursday, 06 November 2014 12:22

Corporate Darwin Awards

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Think About Your Solution

I witness this one a lot in the software space.
What you say: "The next version of our software is going to fix all of the problems".
What the other person hears: "Wait until the next version comes out before you purchase or invest the time to learn something that will be replaced." This is very similar to the Osbourne effect mentioned below. Keep a tight lip on upcoming releases or improvements to your product. Always surprise to the upside.

Let these hilarious, but very real samples of boneheaded business moves inspire you today.

The Overengineered Solution
“I own a vineyard and was looking for numbered tags to attach to the post at the end of each row. One website that sold such items said, "Don't use cheap cattle ear tags to mark your rows!" and proceeded to describe how much better their tags were. I thought, "Cheap cattle ear tags, of course!" and promptly found and purchased them at a fraction of the cost. I would never have thought of it if not for this great marketing!”
Messing With Success
“I officially nominate Schlitz Beer for the Corporate Darwin Hall of Fame. Number one beer in America by far in the late 60s/early 70s, when some genius at the head office decided to change the recipe to save money on ingredients. Sales fell off a cliff. Almost immediately, they changed back to the old recipe. Bu it was already too late. The old Schlitz drinkers stayed away in droves.”
“Management went through 10 (!!) successive rounds of cost-cutting, incrementally decreasing product quality with each round. Lesson learned: Consumers typically don't notice the drop in quality going from A-to-B, but definitely notice the drop from A-to-J.”
The Ratner Effect
Gerald Ratner called his own product "total crap" and inadvertently wiped £500 million from the company's value.”
-Infinite Toilet
The Osbourne Effect
"Reminds me of The Osborne Effect. The Osborne 1 was the first commercially successful PC. The founder pre-announced the successor to the Osborne 1 way before it was ready to come to market. His announcement, touting how good the next machine would be, killed demand for the Osborne 1.
The company then ran out of money and couldn't bring the successor to market, declared bankruptcy, and died."

When You're Not "Selling to Zebras"
"Harland Clarke..
They print Avon Catalogues, checks, scantron forms etc..
Their business is dying because they leveraged everything on check printing. They do something like 98% of checks in the US. If you have a checkbook, I bet $10 it's a Harland Clarke check.
So anyway.. They spun up a company called Fiddipidi. A 100 million investment. Super custom stationary printing. They organized call centers, setup hundred-line VoIP systems in anticipation of the millions of orders they were going to get. Dozens of  graphic artists recruited.
No one bothered to tell them that the advertising platform they'd already blown $40 million on 1. Didn't work, and 2. Targeted an audience that had very little interest in old school stationary, or even one-off custom cards.
Advertising platform chosen: Facebook
Total orders taken: 13
Edit: Found an old advert on TechCrunch:"

The Golden Goose
"This won't be a "top" story, but one of amazing stupidity.
It was the late 1990's, the middle of the tech boom, in San Diego, one of the hearts of the tech boom. A "small" consulting company had about 100 programmers contracted out to about a dozen companies.
The profits were HUGE, the company charged $200/hr per person, paid the employee about $70/hr, pocketed the rest. The only overhead was the small main office, a recruiter, an HR person, and an accountant to handle all of that money and small expenses.
Then the company scored big, Microsoft HQ in Seattle wanted some of these people, contracting about a dozen of them to start. The profits were so huge the programmers were flown back to San Diego each weekend.
The deal was still per-hour, and Microsoft loved the people and asked them to work through weekends, saving the company the cost of airfare and bringing in a couple of extra million $$.
So 2 months later, expense reports are getting kicked back -- the company was refusing to pay large parking fees for the people who worked 7 days/week for 3 and 4 weeks. The company accountant said they "should have taken a cab to the airport since they were gone for 3 weeks". After reminding the accountant that they had not intended to stay that long, that they did so at company request, they were still refused reimbursement on parking.
5 of those contractors resigned due to the parking payment issue, and others slowly followed. The Microsoft deal collapsed because they kept losing people, and within the year the whole company folded.

Yes, this company folded DURING the tech boom, IN a boom city. Hundreds of millions of dollars lost because they wanted to screw over their most income-producing employees over maybe $2,000 in parking fees"