I stressed in my post yesterday how important it is to be uncomfortable, to refuse to live in your own bubble. Seek out those who would challenge your worldview and question the foundation upon which you have built your kingdom. My presumption is that the bubble is caused by the relative isolation creative business owners too often find themselves in. But, as Sony shows us, the bubble can also be a direct function of power and ego. The more you have of each, the less likely you are able to recognize the world as it passes you by.
Imagine if you had a business that dominated music delivery (Walkman), home entertainment (television), games (PlayStation), and home video (Camcorders). Now imagine that you owned one of the world’s largest collections of music rights, film libraries and production. You would be Sony in the 80’s and 90’s. So how would you wind up being very close to losing it all? Sony has not made any money since 2008 and lost $6.4 billion in 2011 alone. It is worth 1/30th of what Apple is. And yet Apple should never be what it is today. WIth all of its resources, Sony could have outdone the IPod, never let ITunes become the gatekeeper or allowed rivals like Samsung to outengineer their televisions. The reasons why history unfolded as it has thus far is the stuff of business school case study after case study. However, for creative business, the one most powerful to me is that Sony lost sight of its core.
My favorite line from the New York Times article that summarizes Sony’s demise is this one, referring both to Sony and the Japanese electronics industry as a whole: “Sony’s woes mirror a wider decline in Japanese electronics. Though executives here are quick to blame a strong yen, which hurts exports, a deeper issue is that once-innovative companies seem to have run out of ideas. And when a nation can no longer compete on abundant labor or cheap capital, ideas and innovation are paramount.” Sony has so many fiefdom’s with absolute power in each that it is virtually impossible to act like a cohesive whole. Steve Jobs was a galvanizing force putting forth the simple statement – design and control the user experience from end to end. Sony did not stand a chance.
So here is the lesson(s) from Sony for creative businesses:
- Everyone in your business represents your business and if you allow more than one voice to speak, a creative business with one voice will kick your ass. There can only be one flavor of Kool-Aid – yours.
- Better to be too early than too late. You cannot tell me no one at Sony saw the world changing under its feet. They just thought they had more time to adapt than they did. Create, innovate or die. Challenge everything you assume to be true about your creative business every time you forget that you are assuming the truth of your beliefs.
- Building on 1 and 2, know who you are, what you stand for and understand that that is your foundation, not your art. There was a time we could not imagine a world without a Walkman, just like we cannot imagine a world without a tablet or smartphone. Fall in love with your art at your own peril. Ethos is timeless, stuff is not.