Companies with great timingChoice, Contribution, Timing
Organizations with great timing are able to seize a moment of unique opportunity by being present to “what it is time for now.” Some great examples follow.
In 1886, David McConnell was selling books door-to-door. Since women were more frequently at home during the day, McConnell made a special attempt to connect by giving away small perfume samples with a sale of books. Over time he realized people liked the perfume more than the books, so he started the California Perfume Company, now known as Avon.
In 1955, Boeing president Bill Allen and the senior Boeing team were facing a high-risk decision. Boeing had thrived from military contracts and survived the post-World War II slowdown through downsizing. A big customer, American Airlines, had requests that would require major changes in Boeing manufacturing. The capital investment was huge. The question became, “Do we keep milking the military as long as possible or bet on the future of commercial aviation?” Allen and his team saw that future growth required a radical evolution to a focus on commercial airlines, and they decided to take the capital risk. The result was the 707, and Boeing’s new era of commercial aviation success began.
From 1968 to 1985, Intel thrived in the memory chip business. With competition looming around the world, Andy Grove and Gordon Moore, Intel’s two most senior executives, had a now-famous conversation. Grove asked, “If we got kicked out and the board brought in a new CEO, what do you think he would do?” Moore replied, “He would get us out of memories.” Grove said, “Why shouldn’t you and I walk out the door, come back, and do it ourselves?”
Grove and Moore did something wise: They wondered what someone who was not addicted to past success would think it was “time for now”. The shift was not easy. In his book Only the Paranoid Survive, Grove said he was haunted by the dilemma. “How could we give up our identity?” he wrote. “How could we exist as a company that was not in the memory business? It was close to being inconceivable.” However, Moore and Grove faced the truth of the trends in low-cost competition and made a major bet on moving to microprocessors. The “Intel Inside” era began.
In 1955, Ruth Handel, who co-founded Mattel with her husband Elliott, was operating a profitable, medium-sized company. The initial product line was picture frames, but looking for something to do with all the scrap wood they started a side line in doll furniture. The popularity of the doll furniture led the Handlers to explore a new business: toys. By 1955, they were successful enough to be approached by the American Broadcasting Company with an offer: would they like to be the sole sponsor a new program called The Mickey Mouse Club? The price would be $500,000, which was the entire net worth of Mattel at the time.
Ruth Handel thought this new world of television would change advertising. Maybe toys could be sold all year long instead of just the six weeks prior to Christmas! She decided to bet on this new trend and risked her company to do it. The bet was hugely successful. By 1962 nearly 90 percent of US households had televisions. Mattel revenues grew from $5 million in 1955 to $100 million in 1965.
In 2005, Odeo, a startup co-founded by Noah Glass and Evan Williams, launched a platform for podcasting. The idea seemed promising and attracted other investors and colleagues like Blaine Cook, Jack Dorsey, and Biz Stone. However, after all the work they noticed something troubling: hardly any of the Odeo employees were listening to podcasts. Cook says, “We built it, we tested it a lot, but we never used it.”
Evan Williams, then the CEO, began to ask Odeo employees to take time off to explore new ideas. A group coalesced around Jack Dorsey and Noah Glass as they explored the idea of a product that would allow anyone to tell anyone else where they were and what they were doing. They called it Twttr. Commercial possibilities were unclear, but they did notice something important very early on: anyone who got exposed to the early prototypes used them a lot. Phone bills became suddenly and surprisingly high.
Apple announced the launch of its own podcasting platform and that added concern. Williams offered to buy out Odeo investors and start a new company that would explore the potential of the Twttr idea, which, as we all know, became Twitter. The core group at Odeo decided to admit error and bet on a new direction. Noticing the signals of user interest became more important than being right about the original investment.
A caveat: Twitter now faces another inflection point. Will they keep evolving? The CEO is stepping down, and the board is dominated by people who have been there since the beginning. Will they inspirit the conversation with insightful evolution or simply defend their past success? We watch with interest.
Airbnb was founded in 2008, at the dawn of the global financial crisis. Talk about perfect timing! The notion of letting strangers into one’s home is easier to consider when times are tough and jobs are scarce. The same conditions contributed to the 2009 founding and subsequent flourishing of Uber, now a wildly successful ride-sharing enterprise.
What other examples of great organizational timing can you think of? Can you also bring to mind some iconic, unfortuante misses? How can you learn to see the invisible gorilla before it does devastating damage?