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About 50% companies have churned out of the Fortune 500 list in the last 10 years. Too many iconic brands are struggling for survival; Kodak, Nokia, Sony, Sharp, Panasonic, RIM, just to name a few. Shouldn’t their past success have made them stronger? This obviously isnt an issue of leadership talent; most companies go through a lot of pain to find the perfect business leader.

These failures seem to be more a failure by leadership to anticipate the changed context that eventually overwhelmed their business. Why would Kodak not realise that digital cameras would wipe out their film business (despite being the first ones to invent digital cameras), or Nokia refuse to acknowledge the massive deluge of low end competitors emerge (despite straddling every price point of the product itself), or for RIM to rest on its one hit wonder app and passively see a computing giant take away its smartphone marketshare, or the lack of urgency of Sony to leverage the strength of its empire that straddles across media to consumer electronics?

The central challenge for any business leader is to stay in-tune with the changing consumer context and business circumstances – this is the BIGGEST input to any strategy. But clearly, it isn’t easy to sense the subtle signs that presage paradigm shifts in business reality, and even more tough to trust your instinct to follow through with change. At what point should you let go of your belief in your own strategy, products and legacy, and set a new uncertain course for your company? If you exit too fast, you will slay your cash cow and lose all the goodwill that you have accumulated; if you do it too late and you will be wiped out from the consumers memory and left living with an unwanted dog (I never quite understood why the guys at BCG hated Dogs). Just working hard or incrementally improving on the current business may be is not be enough of a strategy.

Past success distorts reality for individuals and for companies. ‘Survivor bias’ tends to create a feeling of invincibility in self and in ones strategy, and prevents one from looking at reality with a clear head. We all tend to underestimate the power of Context, which is a much bigger force than individual brilliance. If you are in the right place and the tide is with you, then success is easier and your talent will shine. Shakespeare said it the best –

There is a tide in the affairs of men.

Which, taken at the flood, leads on to fortune;

Omitted, all the voyage of their life

Is bound in shallows and in miseries.

On such a full sea are we now afloat,

And we must take the current when it serves,

Or lose our ventures.

I think if we could analyse Success better, we may all be better off. When something works for you and your business, you want to replicate it, or scale it up rapidly. But before you can do that, you need to be able to understand and analyse success. This needs honesty and sincerity to acknowledging all the factors that aligned to make you successful, and to remove yourself from the centre of the world, i.e to take an egoless view. That seems to be the tough part…