Even though I have completed my MBA, I remain afflicted with the need to read business books. This week, it’s Jim Collins’ How the Mighty Fall: And Why Some Companies Never Give In. I picked up the book in the hope of gaining insights on how to prevent a mature company from losing its way. It’s obvious that many of these lessons apply in politics.
In fact, Collins got the idea for this book from a 2004 seminar for which he was a panelist. The seminar discussed whether the United States was in decline or if it was continuing to meet its promise. Collins made his mark with Built to Last and Good to Great, two books that focused on the common traits of highly successful companies, and what separated them from their peers. After speaking at this event, Collins spoke with a couple of attendees who asked him about their own companies.
Collins looked at a handful of companies that went from being on the top of their game to out of business, sold for peanuts, or irrelevant in the industry. Looking at the reasons behind these companies’ falls, Collins developed a five-stage process of decline companies go through.
So it is with political parties, political movements and obviously political figures. The lessons for Republicans (and conservatives) are twofold. First, it is possible that the Left is in one of the stages of decline. Second, and most important, the Republican Party must learn from its most recent tumble and tries to reverse the damage the conservative movement has suffered the last few years.
Stage One: Hubris Born of Success
This first stage occurs when a company has reached (or is at least approaching its pinnacle). According to Collins, executives succumb to arrogance, continuing to do “what” works instead of asking “why” it works, and discounting luck as a factor of success.
Does this sound familiar? President Barack Obama is the strongest political brand in the world today. One could suggest that Obama’s meteoric rise over the last five years had much to do with luck, but you won’t hear it from the White House.
Arrogance had infected the Obama Administration before George Bush left town. Just days after taking office, Obama answered a Republican who challenged his stimulus bill with a two word answer: “I won.”
Stage Two: The Undisciplined Pursuit of More
In business, this involves a company pursuing new products, new markets and even new industries at the expense of its core competency. For political brands, this stage might occur when the politician or political group seeks something too extreme, especially when it comes at the expense of its main agenda.
Rahm Emanuel famously suggested that “you don’t ever want a crisis to go to waste.” As the White House has virtually taken over two automakers, a couple banks and has set its sights on health care, maybe Obama and the Democrats have proceeded through Stage Two.
Stage Three: Denial of Risk and Peril
This goes beyond the simple denial that a company is not performing and also involves the miscalculation of risks. Mark Sanford is in the midst of Stage Three right now, as he refuses to resign and continues to talk about his affairs even as some of his supporters wince.
The Democrats are in denial, too. After Rep. John Boehner (R-Ohio) spent more than an hour on the floor picking apart the Waxman-Markey “Cap and Trade Bill” to applause, House Speaker Nancy Pelosi (D-Cal.) rebutted, “Just remember these four words: jobs, jobs, jobs, jobs.”
The consequences for the Cap and Trade bill are very real, yet the Democrats insist that it will create jobs. This calculation can very well lead to the downfall of those who voted for it (including eight Republicans, who probably should start sending resumes to lobbying firms).
Stage Four: Grasping for Salvation
Executives and politicians will throw Hail Marys when things get bleak. A company might focus much of its energy on a product launch that it expects to revolutionize the industry. It also might bring in a new executive team, reorganize some departments and expect a quick turnaround.
In politics, attempts at salvation will come in the form of new face, a new idea or a some kind of manufactured event. When John McCain chose Sarah Palin to be his running mate, it came when Obama was comfortably ahead in the polls. Palin provided the jolt McCain needed, bringing the GOP ticket into a dead heat with Obama. But McCain couldn’t build on that momentum because Palin could not compensate for McCain’s weaknesses.
Stage Five: Capitulation to irrelevance and death
Neither party has reached this point yet. Despite media reports that the Republican Party is at this stage, the party still claimed more than 45 percent of voters chose the Republican ticket last November, despite all the problems with the McCain campaign. As troubled as the GOP is, conservatism is alive and well. The party should listen to the conservative movement.
By focusing on limiting the size and scope of government, on protecting individual and property rights and on defending the borders and American interests, Republicans would build momentum again. As easy as it is to fall, it’s possible to rise again.
T. J. Brown's Bio
T.J. Brown is a small business executive by day and a freelance writer by night. He earned a Bachelor's of Arts in Journalism at Indiana University and an MBA from Loyola University Chicago. He lives in Northbrook, Ill. and can be reached at comments@tjbrown.com.
Posted
07-03-2009 12:05 AM
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