How to Kill the Golden Goose - Big Isn’t Always Better

There once was a Blacksmith who immigrated to the United States in the early 1900s. He eventually found his way to the heartland of America after trying his hand at several different endeavors. Somewhere along the way, he realized that his work would be easier if he had pliers that would clamp and hold his work. After several attempts, he invented one that actually worked. His first patent was awarded in 1921 and was followed by others in later years.

Our blacksmith started building product and selling his tool out of the trunk of his car. Gradually he built a business. By 1938 a manufacturing plant was opened in Dewitt, Nebraska with a staff of 37. The business grew and so did the blacksmith’s family. The Golden Goose was fully functioning and providing a living to the family and to the community.

The company continued to prosper and the family continued to grow. Several generations passed and the ownership of the company was spread over a number of cousins, all with different goals and desires. They each wanted their piece of the Golden Goose so they could pursue their own ends.

Eventually one family member, with the aid of a much larger entity, came forward with a plan to buy out the other family members, and save the goose. This might have been the end of the story if that family member had continued to build the business and pay off the lender, but the loan was structured in such a way that the family member who borrowed the money had virtually unlimited resources to expand the business while maintaining his percentage of ownership.

This facilitated the acquisition of other companies and brands. While the new companies were being acquired, the company took on a new name to reflect the larger organization. Promoting the new products and brands resulted in less attention being paid to the Golden Goose.

Eventually the new owner decided that he wanted to cash out on everything that he had been able to accomplish with other people’s money. He sold the Goose and all the add ons to his lending partner.

The lender gladly bought out the owner and slowly incorporated all the businesses into it’s stable. Without the vision and culture of the original entity, all the new owners could do was look for ways to squeeze more from the Golden Goose.

In 2008 they closed the original company and moved the production to China. Over 330 people were put out of work and the original vision and culture died.

I have watched dozens of smaller companies acquired by larger companies. 
Almost always, the original culture and vision die and before long the Golden Goose withers and dies as well.

Could the business have been saved? I tend to believe that some if not most could have been saved if they had focused on their customers and their business instead of focusing on acquisitions.

Sadly, we have killed far too many of the “Golden Geese” in this country. Fortunately we have plenty of people with new ideas striving to grow and create a new Golden Goose. Vision and the culture grow and prosper in smaller organizations and become diluted and forgotten as the organizations get larger and larger. Maybe 
Bigger isn’t Better?

© Copyright Bob Cannon/The Cannon Advantage, 2009. All rights reserved.

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