Monday, September 12, 2011

The Fate of Empires …. and Companies

I recently read a summarized version of Sir John Bagot Glubb’s “The Fate of Empires and the Search for Survival” (1978, out of print), his fascinating observations about the rise and fall of key historical societies, all repeating the same results despite people’s desire for the contrary.

While there are parallels that readers could infer from the societies described in the book as compared to modern society, I was also intrigued by how the patterns described for typical society creation and collapse exist within companies as well.

Each dominant society, according to the author, goes through the following stages, specifically the ages of:

  • outburst (or pioneers)
  • conquest
  • commerce
  • affluence
  • intellect
  • decadence
  • decline and collapse

Dominant organizations go through a process that has often been described as the sigmoid curve, containing the following key stages:

  • inception – the company / project is often self funded and capital / resources invested often exceed results produced
  • growth – a positive return is being generated, with results producing (hopefully) some multiple of what is being put into it
  • maturity – the company is in a place of stability and is potentially a recognized leader in its space.  Many companies fall into the “if it’s not broke don’t fix it” mindset at this point, created by self confidence in their success and potentially setting the stage for potential failure.
  • decline – if new products, services, partnerships, delivery techniques, etc. were not adopted in the maturity step, decline and potential failure are inevitable.



The Sigmoid Curve

The key with business success is to make sure the business leaders embark on new product or service offerings or better delivery techniques somewhere in the maturity stage in order to start a new sigmoid curve and ensure ongoing health of the organization.  Failure to do so results in ultimate decline of the organization which may lead to reduced market impact, decreased valuation or total failure.

What I like about Sir John Glubb’s analysis of society is that it nicely correlates to the classic stages of the sigmoid curve.

Returning to his list as it pertains to business:

  • outburst (or pioneers) – the entrepreneur establishes a new idea that will “shake the world”
  • conquest – initial funding, perception, knowledge-gap, business or technology hurdles are overcome
  • commerce – the company gains traction and begins to generate sustainable income
  • affluence – the company begins to be recognized as a knowledge / market leader
  • intellect – the company has the resources and capabilities to explore R & D initiatives; seeking ways to increase market awareness and penetration or to explore things that it thinks are important to the consumer or to the organization
  • decadence – the organization loses sight of its competitors or the needs of its customers as it becomes blinded by “we’re the best in our space and we know what the customer really wants”
  • decline and collapse – failure to reinvent the organization’s offerings, branding, execution, etc. produce diminished results and the possibility of total collapse.

Within the first five stages (outburst to intellect), it is critical to recognize that one may or may not be the “expert” in all disciplines and knowledge.  Failure to recognize this makes the final two stages almost inevitable.

One of the most common mistakes I see in organizations ranging from startups to well-established organizations is the belief that their organization is different than all the rest, that somehow they will avoid the “laws of nature” that all organizations are subjected to.

And when they do this, they provide a reminder, yet again, that:

“The one thing that history teaches us is that history teaches us nothing” – Hegel

We must become a student of history in order to maximize our future.  When someone is not a student of history, it becomes easy to predict their future and sadly, it often resembles the history that they were ignorant of.

Regardless of the source, history provides the knowledge needed for success …. if we are open to the lessons revealed therein.

In service and servanthood,


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