"George Patterson" wrote in message
news:122Ye.8139$LV5.1123@trndny02...
Matt Barrow wrote:

They could not compete PERIOD. Their management was trained and brought
up
in the world a heavy regulation and was thus completely out of the water
on
running a competitive enterprise.

I think you've hit the main reason. As they grow, companies develop a
"corporate culture" caused by the fact that existing managers tend to
promote people who do things the same way they do. As time goes on, this
"culture" may get out of touch with reality. About the only thing that
will change it is a hostile takeover.


That's a large factor, but they also get n trouble earlier when they move
out of the enrapreneurial phase and past the growth phase and start hiring
"professional managers" instead of promoting from within. The professionals
are often the ones raised on regulation and bureaucracy. They often do worse
than those who learned the business from the ground up.

A manager who came up with the company is more interested in seeing it
thrive; a "professional" (IME) is mainly concerned with making monthly
numbers, is risk averse and focusing on his bonus.

Look at any of the Fortune level firms that have been around for a hundred
years or more (P&G, for example) and you'll find very few high level people
brought in from outside the company.
--
Matt

---------------------
Matthew W. Barrow
Site-Fill Homes, LLC.
Montrose, CO