4 Autopsies of Big Change Management Failures

Autopsies of Big Change Management Failures Can Provide Great Insights

If you resist learning and change, your career and your company are probably not set up for success. Here are a few examples from decades of change management consulting projects of now-defunct organizations whose big change management failures show they did not adequately foresee the necessity for change soon enough or adapt fast enough in a way that made good business sense.

1. Borders Bookstore
   The first of our autopsies of big change management failures focuses on Borders Bookstore.  Borders began as a standard bricks-and-mortar bookstore in Michigan in 1971 and grew to employ almost 20,000 workers before it ceased operations in 2011.  The company failed on multiple fronts.

   Yes, the “old fashioned” bookstores all struggle to compete with online book sales, but Borders had additional challenges they failed to meet.

   For one, instead of establishing their own online sales site, they partnered with Amazon, a formidable rival.  And then, they continued to pour money into expanding their physical facilities while taking their eye off the promise of online sales.  The third and final nail on the coffin was that they didn’t read their market right — a fatal change management mistake.

2. Hummer
   Hummer, the out-sized, rugged, status-symbol of a GM product failed to see the writing on the wall. They received early success because of the early American desire for big vehicles that could travel over any terrain in the world.

   But tastes change and, as they did Hummer didn’t pay attention.  Consumers no longer believed that big was good. They began to worry about the impact of gas guzzlers on the environment and the rising expense of fuel.Hummer lost its brand desirability because they did not change or adapt to the external environment.

3. Blockbuster Video
   Blockbuster was doing great as the leader in video rentals. Viacom purchased them for a whopping $8.4 billion in 1991. Then they seemed to lose their way.  They began to charge stiff late fees and alienated their customers.

   Then Netflix began to erode Blockbuster clients with a “no late fee” policy.  Blockbuster wasn’t paying attention to what mattered to their customers — one of the devastating change management failures to make with internal or external stakeholders.

4. Kodak
   A company that was founded in 1888, Kodak made multiple missteps over its century-long life. Kodak was famously sued by Polaroid when Kodak’s version of an instant developing camera was deemed an illegal knock-off, did not stay price competitive against low-cost mass distributors, lost their film market in good part to Fuji, and bought into the pharmaceutical industry with little idea of how the business works.

   But many would say that Kodak failed because they didn’t foresee how quickly and completely digital cameras would take over the industry that depended on film sales. They were caught behind the times.

What Do These Big Change Management Failures Have in Common?
All different industries – all eventual failures. Do they have anything in common?  One could say that they were ineffective at foreseeing and adapting to major changes.  They were, like many participants in our change management simulation, caught off guard.

The Bottom Line
Maybe not all of these big change management failures could have been averted. But had they been better at foreseeing and adapting to change, we might have enjoyed a Borders website for specialty books; or a smaller, more fuel-efficient version of the Hummer;  or a more user-friendly source for videos; or the kind of quality camera Kodak was famous for now in digital format.

To learn more about avoiding big change management failures, download How to Become a More Change Agile Organization