4 ms·

There's clear evidence that a leader that founded the company with a clear guiding vision is irreplaceable. The large companies that have survived for 15+ years

by abossy 17y ago

There's clear evidence that a leader that founded the company with a clear guiding vision is irreplaceable. The large companies that have survived for 15+ years; Microsoft, Apple, and Amazon come to mind; are those that are most successful even upon maturity.

TrevorJ 17y ago
You are probably pretty much correct, but at the same time if it was that cut-and-dried then the contracts would stipulate tenure a lot longer than 2 years for founders when a startup gets bought out.
- abossy 17y ago
  Notice that the examples I gave aren't companies that have been bought out; they're still being led by their founders. The problem is that less and less companies are having IPOs and reaching massive size to carry out their original vision properly. Instead, their liquidation option is acquisition, which keeps the CEOs of big, rich companies in power and lets them carry out the visions of acquirees the way they see fit -- which usually isn't the optimal solution. A founder is much more suited to carry out his or her vision by having millions of dollars in the bank and no constraints, rather than be constrained by the acquiring company in a system that is bloated and become increasingly bureaucratic.
- ori_b 17y ago
  The companies that survived to follow through on their original vision tend not to have gotten bought out and absorbed into a megacorp.
prewett 17y ago
I agree that you need a leader with clear vision. In my opinion, the definition of a leader is "someone who has a clear vision". I don't think it needs to be the founder, though. In fact, one of the jobs of a leader is to train a successor (I think "Good to Great" mentions this). Empirically, though, vision seems to be a scarce commodity, so having the founder stay on for a long time is a good approach.
ojbyrne 17y ago
Cisco is a counter-example. Also both Microsoft and Apple lost 1 of their 2 founders.
electromagnetic 17y ago
There's lots of evidence that the best leader usually is the founder. For example, Henry Ford made his company possibly the biggest and best auto-company in the world (especially at the time) because he had a vision and the vision was to make vehicles cheap enough that anyone could have one. He paid workers the equivalent of $105 dollars an hour and sold vehicle the equivalent of $7,000 by the time the Model T was retired. He was then forced to switch to the annual model that other companies were doing, which is currently credited with severely damaging the car industry due to the severe lack of brand cohesion. At the time, everybody knew the Model T was a very sturdy vehicle, but today you've got to rely on a models previous generations. Now car companies are considering Henry Ford's original model, instead of releasing a new model every year, you release a new model say every decade so that it gets progressively cheaper and more reliable. People with less money will buy a reliable model later in the cycle when it's cheaper, where as people with large disposable incomes will quickly switch to the new expensive version, which is evidenced by the iPod phenomena. I have mechanics in my family, in fact my father owned his own shop at one point, and when you hear people discuss vehicles they invariably end up saying things like "The 92-95 were good cars, but the 96-97 were disasters". Apple wouldn't have turned the iPod into such a needless necessity by having bad models; the iPod Nano 1G was at serious threat of this with the whole easy screen breaking because they reduced the surface coating too much, however after a bit of a rough start the Nano is now of the same standard as the classic, you don't have to worry about the screen breaking (even though I think they still have to ship with a case because of the EU's 5 year lifetime law for electronic products). The whole founders leaving the company appears to be a Web 2.0 invention. Creators now can get enough buzz about an idea for someone to pick it up and run with it. However, back even twenty years ago if you failed so did your company. IIRC Henry Ford had two failed automotive companies before he started the current company, I believe he also had a third which he used to get majority control of the current company from the shareholders; I believe his second company was a partnership with the Dodge Brothers. The Dodge Brothers Company was sold almost 5 years after their death, by their widows, and it was the biggest monetary transaction in the world, at the time. If Henry Ford had had the buzz around the mass production of the automobile, I doubt his first company would have gone out of business, however I doubt he would have had the knowledge and experience to run the business himself, famously without a single accountant during his lifetime and IIRC the longest period for a large company in the US to not be audited for taxes.

by abossy 17y ago

TrevorJ 17y ago

You are probably pretty much correct, but at the same time if it was that cut-and-dried then the contracts would stipulate tenure a lot longer than 2 years for founders when a startup gets bought out.

abossy 17y ago
Notice that the examples I gave aren't companies that have been bought out; they're still being led by their founders. The problem is that less and less companies are having IPOs and reaching massive size to carry out their original vision properly. Instead, their liquidation option is acquisition, which keeps the CEOs of big, rich companies in power and lets them carry out the visions of acquirees the way they see fit -- which usually isn't the optimal solution. A founder is much more suited to carry out his or her vision by having millions of dollars in the bank and no constraints, rather than be constrained by the acquiring company in a system that is bloated and become increasingly bureaucratic.
ori_b 17y ago
The companies that survived to follow through on their original vision tend not to have gotten bought out and absorbed into a megacorp.

prewett 17y ago

I agree that you need a leader with clear vision. In my opinion, the definition of a leader is "someone who has a clear vision". I don't think it needs to be the founder, though. In fact, one of the jobs of a leader is to train a successor (I think "Good to Great" mentions this). Empirically, though, vision seems to be a scarce commodity, so having the founder stay on for a long time is a good approach.

ojbyrne 17y ago

Cisco is a counter-example. Also both Microsoft and Apple lost 1 of their 2 founders.

electromagnetic 17y ago

There's lots of evidence that the best leader usually is the founder. For example, Henry Ford made his company possibly the biggest and best auto-company in the world (especially at the time) because he had a vision and the vision was to make vehicles cheap enough that anyone could have one. He paid workers the equivalent of $105 dollars an hour and sold vehicle the equivalent of $7,000 by the time the Model T was retired. He was then forced to switch to the annual model that other companies were doing, which is currently credited with severely damaging the car industry due to the severe lack of brand cohesion. At the time, everybody knew the Model T was a very sturdy vehicle, but today you've got to rely on a models previous generations. Now car companies are considering Henry Ford's original model, instead of releasing a new model every year, you release a new model say every decade so that it gets progressively cheaper and more reliable. People with less money will buy a reliable model later in the cycle when it's cheaper, where as people with large disposable incomes will quickly switch to the new expensive version, which is evidenced by the iPod phenomena. I have mechanics in my family, in fact my father owned his own shop at one point, and when you hear people discuss vehicles they invariably end up saying things like "The 92-95 were good cars, but the 96-97 were disasters". Apple wouldn't have turned the iPod into such a needless necessity by having bad models; the iPod Nano 1G was at serious threat of this with the whole easy screen breaking because they reduced the surface coating too much, however after a bit of a rough start the Nano is now of the same standard as the classic, you don't have to worry about the screen breaking (even though I think they still have to ship with a case because of the EU's 5 year lifetime law for electronic products). The whole founders leaving the company appears to be a Web 2.0 invention. Creators now can get enough buzz about an idea for someone to pick it up and run with it. However, back even twenty years ago if you failed so did your company. IIRC Henry Ford had two failed automotive companies before he started the current company, I believe he also had a third which he used to get majority control of the current company from the shareholders; I believe his second company was a partnership with the Dodge Brothers. The Dodge Brothers Company was sold almost 5 years after their death, by their widows, and it was the biggest monetary transaction in the world, at the time. If Henry Ford had had the buzz around the mass production of the automobile, I doubt his first company would have gone out of business, however I doubt he would have had the knowledge and experience to run the business himself, famously without a single accountant during his lifetime and IIRC the longest period for a large company in the US to not be audited for taxes.