The 7 Worst Business Decisions Ever Made
The world of business is full of risks and potential gains. And as much as one might think there is a secret to learning what to do and what not to do, most of it is trial and error. You must learn from the mistakes you and others make while realizing that hindsight is 20/20.
Many former executives are currently sitting around wondering “what-if” they had made the deal. Others are wondering “what if I just let it go?”
Unfortunately, some mistakes are inevitable and can be corrected. Others, turn out to be disasters or huge missed opportunities. Here are our top 7 worst business decisions of all time.
Kodak is not going digital. They discovered it though
This one is a real head scratcher. With almost every adult in the US carrying a digital camera at all times, it’s hard to believe there was a time when all photography was done with film. There was no digital photography technology. This was until 1975 when the Kodak Company invented the technology. However, instead of seeing this as a game-changing opportunity, Kodak decided to shelve the concepts of digital photography.
Why are you asking? Because they thought it would ruin their film business. The company enjoyed a 90% market share till 1984. After becoming an official sponsor of the 1984 Olympics, a Japanese camera company called Fuji entered the US market.
From there things started to go downhill for Kodak. When Kodak went digital, consumers were no longer attracted to the brand. when there is Companies that fail due to lack of innovation, Kodak is all about being innovative but not capitalizing on it. The company never fully recovered from this and other bad decisions. Finally, in 2012, the company filed for Chapter 11 bankruptcy.
Excite.com is not buying Google for $750,000
We all know what Google is today. But in 1999, it was nothing but a highly-impossible dream. Excite.com is now a web portal but was once the most popular search engine of the early Internet. In 1997 Sergey Brin and Larry Page tried to sell their research project, Backrub (later Google) to Excite for $1 million. Because the project is taking time away from their school studies.
CEO George Bell didn’t think it was a good idea. The original offer of $1 million has been reduced to $750,000. But Bell still didn’t move. He felt that he wanted to retain Excite’s current company culture that he could get with the takeover of Google. Brin and Page wanted to use Google’s technology but Bell thought Excite.com’s technology was better. A young upstart isn’t supposed to buy a startup, though Types of business decisions Should that be accepted as a possibility, it seems that Bell had made up his mind about Google.
Most people today have never heard of the Excite brand. But, we all know they are familiar with Google. You can find this article using it. The company is now valued at over $1.22 trillion.
Blockbuster is not buying Netflix
Blockbuster, once upon a time, was at the top of the movie rental game and lived the best life there. It’s no surprise that when a small startup called Netflix was looking for some investors they approached the massively successful company.
In 2000 the Netflix management team approached Blockbuster for a $50 million investment. However, the company’s revenue started to decline. Blockbuster CEO John Antioco struggled not to smile after hearing the offer, according to co-founder Mark Randolph. He didn’t take the try and counter seriously enough. Instead, he closed the discussion and closed the door on the opportunity of a lifetime.
That decision, as well Brand failure to innovate, sealed his fate. Blockbuster ended up filing for bankruptcy in 2010. The company was slow to move into streaming and amassed disgruntled customers who were tired of paying late fees. Netflix is now valued at over $154.96 billion.
Atari isn’t buying Apple
Atari CEO Nolan Bushnell was asked by one of his employees for $50,000. In return Atari would own the company he started with his friend. That employee was Steve Jobs and the company was Apple Computer. Steve worked with his future co-founders in what would later become their own company and built the first Apple computer with spare Atari parts.
Although Bushnell knew that Jobs was a highly intelligent, highly motivated individual, the CEO declined the offer. Although Apple is now worth more than $1 trillion, Bushnell says he has no regrets about the decision. He is from the United States That he has a great life and family and doesn’t know if he would have enjoyed it if he was “uber, uber-rich.”
Yahoo turned down an offer from Microsoft
Yahoo is an interesting company when it comes to bad business decisions. In 1998, the company turned down an offer to buy Google for $1 million. After 4 years, Google was worth more than Yahoo. Yahoo tried to buy Google again. 1 billion dollars this time. But Google wanted $5 billion. Yahoo declined once again.
However, in 2008, Yahoo had a chance to redeem itself as it continued to lose market share to Google. Microsoft approached Yahoo and offered to buy the search engine for $44.6 billion. Founder Jerry Young declined the offer, citing it as too low. Young was and is highly criticized for this decision Forced to resign from his company In 2009.
At its peak, Yahoo was worth more than $125 billion. However, the company was sold to Verizon in 2016 for just $4.48 billion.
AOL-Time Warner merger
Everyone expected that the year 2000 would be the year that Internet companies would completely take over the market. However, the opposite began to happen as many technology companies became overvalued in what we now call “the dotcom bubble”.
One of the first was the AOL and Time Warner merger, set to take effect on January 10, 2000. With a deal valued at $350 billion (one of America’s largest at the time), they were hoping the Internet bubble wouldn’t burst and hopefully reap the rewards. Instead, what they got were record-breaking losses by 2001. They also faced a huge decline in their administration as everyone tried to figure out what had gone wrong with the world.
Both brands are technically still going. But under different names. This merger is seen as the worst ever. It is often used as a case study for business school students on what not to do.
NBC and CBS are turning down Monday Night Football
In the late 1960s, the NFL commissioner, Pete Rozelle, approached the television networks NBC and CBS. He had revolutionary ideas; Monday night football. He made a deal with the networks before this meeting. The deal was to broadcast 2 football games every weeknight. This encouraged him to pursue the vision of broadcasting one game per week on Monday nights. However, network heads did not share the same passion for his vision. They were more interested in keeping popular shows in that time slot. For example programs like The Doris Day Show.
Rozelle eventually inked a deal with ABC for Monday Night Football. The rest is history. Monday Night Football is one of the longest-running and highest-rated shows of all time. The program now airs on ESPN. Weekday football has also expanded to include Thursday night football which is still hugely popular. However, it did not reach the heights of Monday Night Football.
You see, when the stakes are high, the ability to make sound decisions can be difficult to say the least. However, among all these bad business decisions, there were many lessons. Some decision makers would still stand by their decisions today if presented with the same information they had before.
In business, you live and learn through trial and error. And that’s okay. Just learn from these mistakes so you don’t make the worst business decision on anyone’s all-time list the next time it comes around. If you want to learn more about the other side of the decision making coin, check out our article The 6 Best Business Decisions Ever Made.
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