Why can success slow us down?
Why do big companies stop innovating?
Why should we be eager to change, even when things are going great?
Whenever people ask me these kinds of questions, I always think back to a Harvard Business Review piece called “Why Big Companies Can’t Innovate” by Maxwell Wessel. It is brief but brilliant, and pinpoints a problematic shift that organizations go through as they become successful. I think his insight can equally apply to individual people too, who also risk falling behind even as they’re seemingly ahead.
I was sharing this insight just the other day, as I did a Q&A session after a talk of mine. (I’d love to talk with your team too — get in touch!) And I realized it’s so foundational to my thinking that I should probably share it with you too.
The quick-and-dirty lesson is that riding old success anchors you to the past and leaves you unprepared for the future. But let’s talk about how we get there.
Exhibit A: The Epic Fail
You know Gerber. It’s the company synonymous with an adorable baby’s face. That’s because it makes baby food, and that’s all it do. It’s very good at it! But in the ‘70s, Gerber tried to dramatically expand its market — by branching out into adult food.
The product was called “Gerber Singles,” and it was baby food packaged for adults who live on their own. Same product. Just different label, and on a different shelf.
You can guess how many adults lined up for a taste. After three months, total failure: Gerber had to take the product back from grocery stores to free up their shelf space.
Maxwell Wessel opens his HBR piece with this anecdote, and says that, although the adult-food stunt massively flopped, Gerber’s internal logic was sound. “The company did exactly what it was designed to do: create operational efficiency,” he writes.
Big companies, after all, are designed to optimize whatever they do to create maximum output with minimal resources — which means focusing not on sweeping innovation, but on dialing delivery to a science. So of course, instead of inefficiently innovating a new product for adults, Gerber just slapped a slightly different label on the product it already had. It may not have worked in the market, but it sure didn’t cost much.
And when you become better and better at doing one thing, you stop preparing for the moment when that one thing no longer works.
You could look at Wessel’s piece and decide the lesson is that big companies aren’t designed for change. I’d call that defeatist — it doesn’t have to be that way! And the same is true for individuals, too.
Success undeniably feels good. But riding one wave of success isn’t a very reliable way to ensure new successes going forward. Leaning on what you’ve already done means you’re looking backward; any significant change is bound to knock you off balance. And if change is the only thing we can really count on (and I believe it is), being unprepared for it equates to being unprepared for much of anything.
I’m not saying that people or companies should stop doing what they do best. Of course we all need to keep delivering on our value — and efficiently, at that. But you can’t just expect a bottom-line-driven business to innovate its way to the top when the entire organization is optimizing for efficiency. You must set aside resources aimed specifically at innovation.
Google does this very publicly, with its X division set aside specifically for moonshots like wifi-enabled balloons. Chobani is another great example: Instead of dedicating all its resources to Making The Most Yogurt The Fastest, it funds an incubator focused on fixing broken food systems. Fostering all those upstarts improves Chobani’s ability to turn around and launch lines like peanut butter (all the proceeds from this line fund child hunger initiatives) and oat milk (which is increasingly competitive with the one-time darling Oatly — a huge win for a yogurt company facing a dairy drain).
The same goes for people. We want to be prepared for change, but most of us don’t have the luxury of scrapping everything we do to re-envision ourselves or our careers. What’s more practical is to carve out time (and perhaps, budget) for those non-botton-line activities that expand our thinking and our capacities.
I’m speaking from experience here. I’ve been a print journalist for my whole career (talk about a specialty), and a few years ago, I decided to start a podcast, mostly for fun. I wasn’t particularly good at making audio when I started out, but it didn’t matter. It was just a little passion project! But I improved. Years later, when I was in talks to take over as editor in chief of Entrepreneur, the company saw that skill as a real asset — I could go out and represent the brand, and also launch shows for Entrepreneur. Years after that, that podcast provided the starting point for a book I wrote, which comes out next September.
Heck, even this newsletter is a bit of a passion project. I’m not sure where it leads yet, but when that change comes, I’ll be ready for it.
So, what about you?
💬 Got something to share? Leave a comment! I always respond.