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Tom Schori DBA Millennium Marketing Research®, 808 Ironwood, Normal IL 61761, 309-532-8466

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It's time for some mature companies to start 'digging a new well,' if they are to survive.

By Thomas R. Schori, Ph.D., and Michael L. Garee, Principals,  Millennium Marketing Research, 808 E. Ironwood, Normal, IL 61761-5239. Tel. 309-532-8466 -

NOTE: This article was also published by the American Marketing Association's Marketing News, August 17, 1998, Volume 32, Number 17.

There is an old saying that goes like this: "The time to dig a well is before you’re thirsty." And, what, you might ask, does this old saying have to do with marketing or business? Fair question. Let us explain.

While it’s certainly true that American business is generally (and deservedly!) credited with being the unrivalled world leader in innovative technology, it’s equally true that we also have more than our fair share of "mature" industries. And, many of these mature industries are badly in need of "reinventing" themselves, if they are to effectively compete in the dynamic marketplace of tomorrow. Or, to put it another way, it’s high time that some of these industries begin "digging a new well"¾before they get "thirsty," as certainly many of them will.

Many companies on the "top of the heap" in their respective industries today began their ascendancy in the late 1940s or early 1950s, during the tremendous post-World War Two expansion of American business. Many, if not most, of these companies early on established a "top down," highly bureaucratic management style, and essentially relied upon "professional managers" to ensure that a certain number of "widgets" were made this year, an incremental increase in the number of "widgets" next year, and the next and the next. Without question, this approach worked quite well for American business, and particularly for big business, for many decades. That is no longer the case, however.

The smart companies who were doing business this way have seen the error of their ways and have moved with alacrity and gusto to change the way they do business, becoming much more contemporary with the marketplace, and positioning themselves to become sleeker and far more nimble competitors. (General Electric, under the tutelage of Jack Welch, and IBM under Lou Gerstner are two companies that come immediately to mind.) On the other hand, many of the companies falling into this category haven’t really changed that much at all, and will continue to pay a higher and higher price for their recalcitrance.

To be sure, the sizzling economy that we’ve been experiencing for quite a number of years now has allowed many of this cumbersome, bureaucratic companies an opportunity, if not to prosper, at least to prevail¾for now. But, what will happen when the economy ultimately begins cooling, as any student of economics and business history knows will surely happen? When that happens, missteps and squandered marketing opportunities that are today somewhat easily "forgiven" by today's exceptional economic situation, could easily prove fatal!

Ample evidence that many of the aging industry leaders are becoming increasingly moribund is all around us. Where have the millions of new jobs in the U.S. come from? Big business? Absolutely not! The overwhelming majority of new jobs have been created by the far more nimble, far more innovative small business sector. Big business, at least in some key industries, continues to cut its payroll, in a seemingly desperate (and apparently ongoing) attempt to "dress up the bottom line," thereby making themselves more attractive to Wall Street. Moreover, with some notable exceptions, e.g., IBM, Intel, et al., most of the technological innovation is coming from small business as well. The big companies, with their consensus management styles and layers upon layers of bureaucracy, simply don’t seem to be able to move quickly enough to be all that innovative.

As we’ve said many, many times, in many, many different ways in previous columns, instituting genuine change in any organization of human beings is at best a significant challenge. In the huge businesses dominating their respective industries, we recognize that it appears to be nearly impossible! Still, we believe, as certainly many other business critics believe, that the very survival of some companies now at the apex of their industries will depend upon their making substantial changes in the way they do business. They indeed are going to have to "reinvent" themselves, if they hope to compete in the 21^st Century marketplace. That is, they better start thinking about "digging a new well," and soon!