By The Urban Blabbermouth
Today, I walked past the Woolworth Building. The Woolworth Building is one of the oldest skyscrapers in the US and was the world's tallest building for more than fifteen years in the early twentieth century. The building stands as a symbol of great architecture and as a symbol of business failure. The Woolworth company does not exist any more. It may have morphed into some other company but it does not exist as the Woolworth stores that I knew when growing up.
How does a company run by some very smart men go out of business? I understand that the business environment does change and that Woolworth did not keep up. But it's not like Woolworth's management did not have examples to show them what to do. Walmart was rising up while Woolworth was going down. All the management of Woolworth had to do was follow the Walmart example. How hard can that be?
Maybe the Woolworth management did not have what it takes to change the company. Old companies get set in their ways and do not want to change. Like dinosaurs, they fade and another company rises up to take its place. Capitalism at work.
Maybe after the Woolworth founder, F. W. Woolworth, died, the Board of Directors could not find anyone to replace him. The Board could not find other managers who had F. W. skill and knowledge to run his business. I find it hard to believe that the Board could not find a capable manager in the entire USA. It is not easy but the managers are there. Could have hired some of the Walmart managers.
At the extreme, Ayn Rand, via Atlas Shrugged, would probably suggest that the freeloaders took over the company. The company became full of employees who wanted the salary and did not want to work for it. As a result, the hard workers left Woolworth to work for other companies (eg Walmart) or to start their own companies. You would think that the freeloaders would save the company so as not to kill the golden goose. But, you can kill a golden goose if another golden goose can be found to replace the dead one.
Woolworth has come and gone. The professors who study business cannot explain why this happened. The professors do not know if it was lack of skills or just bad luck that killed Woolworth. This is bad news. Today, There is a long list of companies on the same path as Woolworth. Sears, J.C. Penny, and Blackberry have already commenced their trip to obscurity. They will spend the next ten years slowly dying. Walmart and Microsoft are now on the cusp of the same path. Their next set of decisions will tell us if they can save themselves.
Maybe the companies will leave us some impressive buildings to remember them.