The Fruits of Civilization – Discontinuities


Most every adult in a post-industrial society has had the experience of a favored product degraded or replaced with an ersatz substitute. Conversely, improvements on high-quality goods are rare. (Dyson, which makes high-quality products, has generally improved its flagship vacuum cleaners by simplifying the overengineering in their earlier models. Dyson is one of the few companies that unabashedly demonstrate engineering intelligence and truly value product quality.) The old saw “they don’t make them like they used to” applies to technological products as well as it does to the cheapening of everyday hardware that breaks too easily or wears out too soon.

Back in the mid-1980s, the telephone company Sprint advertised that you “can hear a pin drop” by using their fiber optic telephone network. Though the millions of miles of fiber optic cable are still there, the days of decent telephone reception are long gone. The descent of telephony onto the Internet has been a formula for noise and dropped calls.

There are 2 discontinuities that occur with technological products. The 1st is with product updates. The 2nd is corporate fumbling in the technology marketplace.

“New and improved” guarantees the former at the expense of the latter. Updates of technical products often lose or degrade good features and can be more difficult to use. It is as if the designers don’t have a grasp on what makes their products outstanding. The failure to comprehend core concepts is what characterizes the folly of humanity in all ways.

A related dynamic is that companies typically lose their market share as technology progresses from one generation to the next. A current leader, vested in the technology of the day, is slow to the move into the next generation. By the time they do, it is too late, as a competitor has seized the moment.

Motorola was the leading maker of early cell phones, beginning in the late 1970s. Motorola lost its edge to Nokia in the next decade as cellular technology moved from analog to digital. But Nokia’s reign did not last, even as it was an early adopter of touchscreens.

Nokia was aware of changes in the marketplace; and it never fell behind in technology, nor suffered a dearth of clever marketers. What Nokia lacked was the managerial will to decisively change.

From 2003 to 2007, the Blackberry, with its tiny keyboard, became ubiquitous. Then Apple doomed the Blackberry with its touchscreen “smartphone.” The iPhone made Apple the industry darling that it had never managed to be with its computers. (Besides not being a phone maker, and so eager to enter the market with a splash, Apple’s iPhone market momentum was greatly aided by its leadership position in mobile music players (the iPod).)

Apple was unable to retain its dominance, as Korean conglomerate Samsung copied key features of Apple’s phone interface and introduced better hardware. Apple practically forced users of its phones to upgrade, as the company surreptitiously slowed the performance of older models – a moral decadence displayed in technology.

Meanwhile, Microsoft has never been able to translate its dominance on the computer desktop to the mobile phone market, though not for lack of trying. The core problem is stodginess. The Windows phone offers nothing distinctive, let alone appealing. But then, Microsoft has always been an imitator and incremental tinkerer at best.

Seldom was the dominant company along the way the technical product innovator. IBM and Bellsouth marketed the first smartphone in 1993, though they were not able to make a go at it. Instead, market momentum went to having the right product at the right time, well-marketed to the right audience.

The key is always intelligent management, which is stunningly sparse. The larger and more successful a firm becomes, the more risk-adverse it grows to be. Arrogance and rigidity set in.

Around the world, no one is so overpaid for sorely lacking strategic skill as corporate management. The rare exceptions prove the rule.