Well, it’s Tesco and Sears. Both have supermarkety bits to them, both do more, both have interestingly turbulent times. I’m just terribly interested when unstoppable companies stumble: IBM was invincible and now it’s still gigantic and successful but you barely think of it. Microsoft, much the same. Now Tesco, surely royalty of UK supermarkets if not yer acksual king, has taken a kicking.
There’s a schadenfreude element, I suppose, and I’m not embarrassed by that when, for instance, the company falling from a dizzy height only got to that height through blatant copying of another firm. (Did you hear the joke when Apple’s Tim Cook came out as gay? Word was that the head of Samsung was going to come out as more gay.)
But speaking of Apple, I’m also interested really interested when big companies turn around. Apple was within 90 days of bankruptcy and look at it now. Maybe this all speaks to me because I’m a freelancer and a writer: I don’t have a multi-billion dollar business nor, crucially, thousands of employees but we get the ups and downs, we really get them.
So this pair of unrelated but oh-so-very-related articles from the Harvard Business Review makes an absorbing read. First this about Tesco’s woes:
Tesco’s chairman has resigned in disgrace. The company’s market value has more than halved to an 11-year low as it acknowledged overstating profits by hundreds of millions of dollars. And a humbled Warren Buffett, after opportunistically raising his stake in the company after a surprise profit warning, confessed to CNBC: “I made a mistake on Tesco. That was a huge mistake by me.”
And now one about how Sears has faced stumbles before but manages to get up and have another go:
It’s easy to suggest that perhaps it’s simply run its course; after all, over the last 50 years, the average lifespan of a company on the S&P 500 has shrunk from about 60 years to less than 20, as more than one business thinker has pointed out. Founded in 1886 as a mail-order watch retailer, Sears was already 71 when it became an original member of the S&P 500 in 1957. At the hoary age of 128, it had beat the odds twice over when it lost its place to chemical maker LyondellBasell at close of trading this year on September 4th.
But perhaps its current woes are just a blip in a long, long history of facing and rising to challenges. A trip through the HBR archives shows just how cutting-edge the company has been in so many ways for so long
Sears Has Come Back from the Brink Before – Andrea Ovans, Harvard Business Review (28 October 2014)