Dear Enterprise Leaders, You’re Screwed. Here’s Why.


Dear Enterprise Leader,

I’ve got some terrible news for you. Your best talent isn’t good enough to compete. Better talent is at work right across town, in an over-crowded garage at the house of some tiny firm’s founder.

Unlike your mammoth offices, this garage is full of energy, excitement, and – here’s the worst part for you – it’s full of absolute brilliance, the type of brilliance your own company was attracting just a few years ago, at the depth of the recession.

Buddy, you’re screwed. Chances are, it’s all over but the crying.

Your company is big, has a whole lot of customers, and an absolutely astonishing amount of cash. That’s all great, without question.

So what on earth am I carrying on about?

They’ve been so vanillafied that they have no flavor

In today’s business environment, each of those benefits I listed is actually a liability, that’s what.

You’re big – cumbersome. While new, little companies can turn on a dime, your bureaucratic processes allow you to change course about as quickly and gracefully as a fully loaded cargo ship on a water-ski slalom.

Worse, by the time all of your committees and layers of management put new ideas through their paces, they’ve been so vanillafied that they have no flavor: they’re safe, when today’s hyper-competitive world demands bold.

You have a lot of customers: good news, right? Not when all of your customers hate you. And let’s be honest, the only reason you haven’t adopted Net Promoter Score is that you don’t want your stockholders to learn what you already know: that it’s damned hard to find a promoter among your maltreated and ornery customers.

You’ve got contracts? Contracts expire, and as they do, the customers you tricked or bullied into signing will be only too happy to talk to that little garage firm across town.

You’re cash rich: yea!!! Right? Not when your employees resent you for it as they do. They know full well what reserves you have on tap, and what lavish bonuses you dole out to your C-level cronies every year.

Meanwhile, their own wages have stagnated for far too long; they’ve endured layoffs of their friends and had to absorb two, three, or more people’s workloads. As with your customers, you don’t ask your employees about their engagement for a very good reason: you already know, and you don’t want your board to get wind of it.

Time was when you could read those bullets and laugh smugly, while ordering another round of layoffs and another new jet. But with the recession behind most of us, and with the costs associated with starting a company at unprecedentedly low levels, new companies are popping up all over the place. These startups have energy and excitement, as startups often do.

Order another round of layoffs and another new jet

They also have one more feature that maybe wasn’t so important back when you were cutting your teeth in business a generation ago: they have much of the best talent available, anywhere.

The economy of the Twenty-Teens is motored by talent rather than by geography or capital or scale or defensive patents or anything else that used to matter last time you checked.

Talent is such a vital component of business that the following sentence should be tattooed backwards on every leader’s forehead, for them to read in the mirror several times each day:

He who wins the war for talent wins it all.

Are you winning the war for talent? Are you even fighting in that war? Or are you playing by last century’s playbook? – And I do mean playing, while those inspired, engaged, ingenious folks in the garage across town aren’t playing around at all: they’re fighting, and they’re winning.

It’s an important question, because if you don’t figure out how to attract and keep fewer bureaucrats while adding and retaining more talented staff, you truly are screwed.


Continue reading our New Leadership series with Time to Embrace the Millennial Overachiever

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Ted Coiné is a Forbes Top 10 Social Media Power Influencer and an Inc. Top 100 Leadership and Management Expert. This stance at the crossroads of social and leadership put him in a unique perspective to identify the demise of Industrial Age management and the birth of the Social Age. The result, after five years of trend watching, interviewing and intensive research, is his latest book, A World Gone Social: How Companies Must Adapt to Survive, which he co-authored with Mark Babbitt. An inspirational speaker and popular blogger, Ted is a pioneer of the Human Side of Business (#humanbiz) movement. He is also a serial business founder and three-time CEO. When not speaking at conferences and corporate functions, Ted advises CEOs on how to become Truly Social Leaders, or “Blue Unicorns” as they put it in A World Gone Social, in order to bring their companies into the Social Age. Ted’s advice: “Change is only scary if it’s happening to you. Instead, bring the change your competitors dread. That is something only a Social Age business leader can accomplish.”

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  • Another fantastic post, my friend. Absolutely love this. Hope some of the big dogs actually read it. take care brother. Not sure when I will be back to Naples. We need to set up a lunch meeting or something.

  • Madhurima Nag

    A very well written article rather letter I must say! Big enterprise leaders do need to worry, don’t know whether they are aware of it at all!

  • danperezfilms

    Yeah, being a big company with a lot of customers and cash rich really sucks. And Generation Y is gonna show those old farts how it’s done.
    More generalizations.
    C’mon, Ted. Really?

  • Ted,
    You nailed it. Another “sad state” that I’ve observed is big companies that chase the latest technology with absolutely no concept of how to “play in that sandbox.” Look at the number of companies that rushed to be players in social media only to do nothing, but “push” their message while having a total lack of understanding of how to interact with customers on these platforms.

  • ahhprods

    So true. Before starting my bean bag biz, I was a process engineer and saw how bogged down large companies get- simple processes became illogical, and the employees were always frustrated but the companies were so large they weren’t flexible enough to make even the most logical changes!

  • To some extent big companies with old mentality will go extinct but don’t forget that now Google, Apple, and Facebook are the large, cash reach enterprise. Do they see what you are writing? not so sure. Also take a look at what Marissa Mayer is doing with a big and cash rich enterprise… She will blow your socks off!

    So maybe you ought to look harder at what you refer as the characteristics of a dying company…

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  • Ed Gutierrez

    Wow. Great post. Easy read. And well said. This is true for most big companies. It really doesn’t get any clearer than this. If you are one of those big companies, and you’re about to become extinct, I suggest a cultural overhaul that you have to really believe in. If not, your employees won’t believe in it either. And one of the key ingredients; don’t be above acknowledging or working WITH anyone you employ.

  • Stew

    Ted, this is just an inane rant. Bitter, opinionated, prejudiced, arrogant crap, completely void of substance.
    But, you’ve got it off your chest now; do you feel better?

  • Sounds like you are talking about how Apple now operates. Still, let’s
    be optimistic and trust that the CEO’s of large, ‘old’ organizations will soon
    realize that it’s not the hoard of dead cash that they are leading, but the
    opportunity to unleash the potential in their people.

  • William Powell

    Love it Ted! I was talking about some things in my business today and the idea of “packaging” something came up. I nearly had a nervous episode. I can’t, in good conscience, take the message of people being the center and “package” it. It has to have a face that meets a face. Thanks for the reminder and the confirmation!

  • Ted,
    I look at this question a bit differently. And I think this is the root of the discussion in the comments here. IMHO it’s not about size. It’s about culture and leadership. Some of the comments here have danced around it. But the distinction must be specifically called out. There are examples of companies of all sizes that are disfunctional to the point where the best talent splits. The issues are different. But the result is the same…talent drain. The issues you outlined here are not the exclusive domaine of the Fortune 500. I’ve seen mid size companies experience the same challenges – overhead, stifling of creativity, etc. Where, as has been accurately called out here, some gigantic companies remain nimble, progressive, customer focused and innovative. It all comes down to the leader. The CEO. So, I would suggest that your post, in a manner of speaking, lets these CEOs off the hook. You’ve implied that its the size of their companies that is at the center of the issue, not them. Keep the thought provoking posts coming.

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