James B. Stewart, one of the foremost business analysts of our time offered this rather obvious reason for the dramatic decline of General Motors in the Wall Street Journal – “It has been long in coming, this slow death of what was once the greatest and biggest corporation in the world. The myriad causes of its demise have been thoroughly chronicled, but to my mind one stands out. The custodians of GM simply gave up trying to build the best cars in the world. To accommodate a host of competing interests, from shareholders to bondholders to labor, they repeatedly compromised on excellence.”
As Bob Lutz, in his interesting analysis of why Detroit and the big three failed, says the big auto makers – GM (NYSE: GM), Ford (NYSE: F) and Chrysler ignored the “car guys” in favor of the “bean counters”.
It makes sense. Software companies should be run by software experts, shoe companies should be run by shoe experts, and movie production companies should be run by movie experts. When companies lose sight of the entrepreneurial drive to provide the greatest consumer experience possible, then they are destined to fail. Far too often leadership puts its faith in numbers and spreadsheets, to the exclusion of excellence in product and consumer care. When the numbers people take charge of a company, companies often lose their competitive edge. Management becomes far too smart for its own good, running the company for the bottom line to the exclusion of all else. Decline is inevitable. Passion and drive for excellence will win out over an analytical, number driven, computer-like philosophy every time.
Eventually, GM hired Bob Lutz out of retirement to save the company, by making exciting cars again. Lutz was a product of the early sixties, when CEOs knew that if you captured the public’s imagination with great cars, the money would follow. GM had wandered far away from excellent product, giving sway to what Lutz calls the “bean counters” or in other words - the accountants. The company was overly focused on balance sheet management and analysis; creative leadership was a thing of the past. Lutz immediately embarked on a crusade against risk avoidance, penny pinching, turf wars, and office politics. As a direct result, GM has found its way back; thanks to its implementation of Lutz’s philosophy on what makes a business great for consumers and shareholders.
Apple Inc. (NASDAQ: AAPL) may be the world’s most recognized brand in computer and computer technology. Steve Jobs and Steve Wozniak (the creative brains behind the company) founded Apple Computers in 1976 with the release of the Apple I. When the “bean counters” ousted Jobs from his own company in 1985 due to an internal power struggle that saw the Board of Directors opt for the bottom line over creativity, one of the computer age’s greatest success stories quickly became obsolete. Apple faced stiff competition from the International Business Machines Corp.’s (NYSE: IBM) PC. Apple began losing traction rapidly and could not compete with sales of the PC. In 1996, Jobs came back to AAPL when the company purchased his NeXt firm, reappointing him to the CEO position. He immediately began a critical restructure based on creativity in product and excellence in consumer care. The “bean counter” mentality was out; the passion and drive for excellence was in. Today Apple is one of the richest and most successful companies on the globe, thanks to the philosophy of Steve Jobs that is still in place two years after his death.
Medient Studios Inc. (OTCQB: MDNT) is a “David” in comparison to these Goliaths but the company seems to have absorbed the fundamental principle of “Excellence” as the core of success.
The company recently announced plans to re-engineer the movie production process by vertically reintegrating the various component elements. This throwback to the ‘golden age’ of Hollywood when the Studios controlled most of the elements and generated huge returns is bound to be controversial, but going by the examples cited above, the probability of dramatic success is high.
Medient is also a leader in public-private initiatives that benefit economic growth on the local, state and federal levels. Medient recently signed a deal with the Effingham County Industrial Development Authority (‘ECIDA’) to build a substantial studio complex outside of Savannah, Georgia. The agreement works strongly to the advantage of both parties. In addition to leasing 1,550 acres to Medient, with zero percent financing, and providing cash grants for site improvements; the Georgia Department of Community Affairs and Georgia Department of Economic Development also have committed a $3 million grant for the project. As a result, the studio campus will generate over 1,200 direct jobs and thousands more indirectly. This translates into a strong economic catalyst for the county and state. The studio complex is designed to make multiple motion pictures simultaneously at an estimated 35% lower cost than traditional movie making, while delivering excellence in product in the film genres that have the highest return on investments.
Historically, companies that were created by thought leaders who “broke the mold,” challenged the status quo, and over delivered to their customers, have grown into the entities that shape our daily lives. Medient is challenging the industry’s concepts of how movies are made, and is poised for massive growth.
NEW: Feature your company on EmergingGrowth.com. Find out how by filling out our referral form here... http://emerginggrowth.com/recommend-a-company-to-feature-on-emerging-growth
About EmergingGrowth.com:By offering 100% original and unmatched content by the best financial reporters, writers and bloggers in the business, EmergingGrowth.com is emerging as a leading digital financial media portal. Its services provide users, subscribers and advertisers with a variety of content and tools through a range of online, social media, mobile and other mobile outlets. Since its inception, EmergingGrowth.com has distinguished itself from other financial media companies with its sly approach to reading between the lines in order to locate that needle in the haystack. Sign up today to see what EmergingGrowth.com has to offer.
Contact:EmergingGrowth.com
[email protected]
305-323-5687
Join our Linked in Group\'85 http://www.linkedin.com/groups/?gid=4650356&trk=hb_side_g
Like us on Facebook... http://www.facebook.com/pages/EmergingGrowthcom/474647062557938Disclosure
All information contained herein as well as on the EmergingGrowth.com website is obtained from sources believed to be reliable but not guaranteed to be accurate or all-inclusive. All material is for informational purposes only, is only the opinion of EmergingGrowth.com and should not be construed as an offer or solicitation to buy or sell securities. EmergingGrowth.com has a long position in a company or companies mentioned in this article Full details of which can be found here, http://emerginggrowth.com/special-disclosure Please consult an investment professional before investing in anything viewed within. When EmergingGrowth.com is long shares it will sell those shares. In addition, Please make sure you read and understand the Terms of Use, Privacy Policy and the Disclosure posted on the EmergingGrowth.com website.