September 2011 - MINDA Malaysian Directors Academy ...

article fourMALAYSIAN DIRECTORS ACADEMY 14Importance of not fearing changeIn 1996 Andy Groves of Intel famously wrote, “Only the paranoid survive” i , introducing his book with the following quotationfrom Joseph Schumpeter’s Capitalism, Socialism and Democracy written in 1942:“But in capitalist reality, as distinguished from its textbook picture, it is not (price) competition which counts but thecompetition from the new commodity, the new technology, the new source of supply, the new type of organisation…competition which… strikes not at the margins…of existing firms but at their foundations and their very lives.”If we accept that innovation and the associated change strike at the very heart of businesses’ ability to survive, we mustthen ask ourselves why the enemies of change are so powerful. Part of the reason is marketing myopia ii ; part of it is therational defence of vested interests within and outside the organisation because change creates losers as well as winners.Table 2 below lists quotes of people, who should have known better, suffering from marketing myopia:Table 2: Examples of Marketing Myopia“Everything that can be invented has been invented.” Charles H. Duell, Director of US Patent Office 1899“Sensible and responsible women do not want to vote.” President Grover Cleveland, 1905“There is no likelihood man can ever tap the power of the atom.” Robert Miliham, Nobel Prize in Physics, 1923“Heavier than air flying machines are impossible.” Lord Kelvin, President, Royal Society, 1895“The horse is here today, but the automobile is only a novelty - a fad.” President of Michigan Savings Bank advisingagainst investing in the Ford Motor Company“Video won’t be able to hold on to any market it captures after the first six months. People will soon get tired ofstaring at a plywood box every night.” Daryl F. Zanuck, 20th Century Fox, commenting on television in 1946“What use could the company make of an electric toy?” Western Union, turning down rights to the telephone in 1878Perhaps the more important reason for firms being unable to embrace innovation easily comes from failures of leadershipand the lack of ability to manage change proactively. Table 3 below shows what it takes to be able to be creative andembrace change and some of the powerful obstacles to being successful in that process: