17 Corporate Darwin Award Nominees (They Goofed)
This company owned Park City Mountain Resort, one of the leading Ski Resorts in the nation, located in Utah. They had a lease on the land for $155,000 per year (a small amount for a multi-million dollar business!). In 2012, they had the option to extend the lease for 20 years, locking in that great bargain, but somehow they completely forgot! They sent a letter 2 days too late, and now the resort is owned by Vail Resorts who bought them out after a long legal battle.
Remember the bookstore Borders? They went completely out of business in 2011, and a huge part of that likely came at the hand of their biggest competitor: Amazon. Borders made a terrible decision way back in 2000 to actually let Amazon (which was innovating the online and ebook industry) control all of their online book sales. They gave themselves away to their competitor, how silly.
Yay, MySpace. At least that's what everyone was thinking originally, until Rupert Murdoch bought it. He paid $580 million for itin 2005 and then proceeded to overrun the place with ads. They were too intrusive and simply drove everyone away to the new Facebook. He sold it later for $35 million, less than 10% of his original investment.
Michael Birch and his wife Xochi Birch sold the once popular social network Bebo to AOL for $850 million dollars. It had a huge UK user base and had great potential at the time. AOL really messed up the direction of the site entirely, and ended up selling Bebo right back to the Birches 5 years later for only $1 million. There may be great plans for the Bebo brand in the future, but they aren't out yet.
Kodak had over 85% of the film and camera business by the late 1970s. They were synonymous with anything to do with photography, so much so that their name lingers to this day, but they will never be quite as powerful due to a huge mistake. They actually invented digital photography in the 70s when they were at their peak, but the leaders of the business were too scared to move away from traditional film. Now digital cameras are everywhere with smartphones being so popular, and Kodak isn't dead, but compared to what it once was, it's close enough.
A restaurant called Tokyo-Tokyo in the Phillipines offered unlimited rice with every meal, drawing in huge crowds regularly with such a deal. For a brief time, they stopped the deal, thinking they would save money on it, and their customers vanished. Even bringing the deal back did not help them recover. Olive Garden, as you may know, has an unlimited breadsticks deal. They might soon be reconsidering the quantity of breadsticks they serve... hopefully they don't make the same mistake as Tokyo-Tokyo.
In 1991, Gerald Ratner gave a speech that would have a business concept called the "Ratner Effect" named after himself. He gave a single terrible line about his Jewelry products during a speech: "'How can you sell this for such a low price?' I say, 'because it's total crap.'" Calling his own product crap resulted in his business losing 500 million British Pounds in value, nearly completely taking out the business, and forced him to resign the next year.
Blockbuster made a HUGE mistake by refusing to buy Netflix for a mere $50 million. Blockbuster thought surely the DVD-by-mail service was never going to work, and stuck to their in-store physical movie rental service, hoping to cling to profits on late fees. Now, in 2014, Netflix is worth more than $20 billiion, and Blockbuster has faded away after filing bankruptcy and closing almost all of their stores.
Netflix wasn't always perfect either. Not long ago, they came up with the idea of splitting their DVD and online streaming services. Qwikster was a spinoff company formed to handle the DVD mailing service. People were outraged and hated having to use two different services for their movies, and fortunately for Netflix they made a smart decision to kill Qwikster within a month of it's launch.
Enron of course had numerous problems and forms of illegal activity that lead to their demise. One of the funniest, however, was their policy to pay executives for simply coming up with an idea regardless of whether they actually used it. The conversation likely went "It would be great if I could get paid for all these great ideas I can't implement." "How about we do that then?" "That's an amazing idea! Have a bonus!"
Digg was similar to Reddit in that it used votes to show users the best news articles from around the web. One update to the site in particular killed it though: They made it so that sponsored posts and top-user submitted content was wayyy too common and flooded people's feeds, causing users to go on a mass exodus to the now-huge site Reddit. Some form of Digg still sits out there, with a tiny userbase compared to what it once was.
Some may remember the popular show "Fear Factor." It was revived late 2011 , only to be canceled again in May of 2012. The reasons were varied, but a likely huge part was a lawsuit that developed from their decision not to air an episode titled "Hee Haw! Hee Haw!" in which contestants hat to drink Donkey semen.... disgusting.
Western Union is known now for money-transfer services, but they didn't used to be that way. They were a telegram service first. Alexander Graham Bell offered to sell them the Telephone for $100,000 (a lot at the time), and they laughed it off. If only they knew the future would be completely filled with almost nothing but telephones..
The SciFi channel used to be great at doing exactly what the name suggests: providing good Science Fiction content. ThenÉ They changed their name to SyFy and became too "cute", running more reality TV type shows. They might be going back to their roots soon, but for now they're driving themselves into their own grave.
SEARS used to be part of the backbone of America with their department stores and their catalogs. Their recent CEO Eddie Lampert took a very unusual methodology and brought it to Sears. He laid off tons of employees, cut back on so many expenses to the point of crippling their stores, and pit the workers who did remain against each other for benefits and bonuses. Sears lost half of it's value and closed over half of their stores in only five years. They're essentially liquidating in slow motion, and they are just a ghost of what they used to be.
Osborne Computer is the reason you will never know about that new iPhone until right before it releases. When Osborne started telling people far too early about how cool the SECOND Osborne computer would be, no one bought the first one anymore! The company never got to finish the second computer because they ran out of money due to no sales of the first computer and went out of business.
Circuit City is known today as somewhat of an afterthought business. A huge part of this is that bakcin 2000, they decided for some reason to stop selling appliances (a very stable market!) and decided to focus solely on consumer electronics like TVs. That didn't work out too well... They also fired every employee who was making a higher than average wage! So all the good employees got fired... Terrible decision.
Source
http://www.brainjet.com/random/5642/17-corporate-darwin-award-nominees-they-goofed#slide/1/0
This company owned Park City Mountain Resort, one of the leading Ski Resorts in the nation, located in Utah. They had a lease on the land for $155,000 per year (a small amount for a multi-million dollar business!). In 2012, they had the option to extend the lease for 20 years, locking in that great bargain, but somehow they completely forgot! They sent a letter 2 days too late, and now the resort is owned by Vail Resorts who bought them out after a long legal battle.
Remember the bookstore Borders? They went completely out of business in 2011, and a huge part of that likely came at the hand of their biggest competitor: Amazon. Borders made a terrible decision way back in 2000 to actually let Amazon (which was innovating the online and ebook industry) control all of their online book sales. They gave themselves away to their competitor, how silly.
Yay, MySpace. At least that's what everyone was thinking originally, until Rupert Murdoch bought it. He paid $580 million for itin 2005 and then proceeded to overrun the place with ads. They were too intrusive and simply drove everyone away to the new Facebook. He sold it later for $35 million, less than 10% of his original investment.
Michael Birch and his wife Xochi Birch sold the once popular social network Bebo to AOL for $850 million dollars. It had a huge UK user base and had great potential at the time. AOL really messed up the direction of the site entirely, and ended up selling Bebo right back to the Birches 5 years later for only $1 million. There may be great plans for the Bebo brand in the future, but they aren't out yet.
Kodak had over 85% of the film and camera business by the late 1970s. They were synonymous with anything to do with photography, so much so that their name lingers to this day, but they will never be quite as powerful due to a huge mistake. They actually invented digital photography in the 70s when they were at their peak, but the leaders of the business were too scared to move away from traditional film. Now digital cameras are everywhere with smartphones being so popular, and Kodak isn't dead, but compared to what it once was, it's close enough.
A restaurant called Tokyo-Tokyo in the Phillipines offered unlimited rice with every meal, drawing in huge crowds regularly with such a deal. For a brief time, they stopped the deal, thinking they would save money on it, and their customers vanished. Even bringing the deal back did not help them recover. Olive Garden, as you may know, has an unlimited breadsticks deal. They might soon be reconsidering the quantity of breadsticks they serve... hopefully they don't make the same mistake as Tokyo-Tokyo.
In 1991, Gerald Ratner gave a speech that would have a business concept called the "Ratner Effect" named after himself. He gave a single terrible line about his Jewelry products during a speech: "'How can you sell this for such a low price?' I say, 'because it's total crap.'" Calling his own product crap resulted in his business losing 500 million British Pounds in value, nearly completely taking out the business, and forced him to resign the next year.
Blockbuster made a HUGE mistake by refusing to buy Netflix for a mere $50 million. Blockbuster thought surely the DVD-by-mail service was never going to work, and stuck to their in-store physical movie rental service, hoping to cling to profits on late fees. Now, in 2014, Netflix is worth more than $20 billiion, and Blockbuster has faded away after filing bankruptcy and closing almost all of their stores.
Netflix wasn't always perfect either. Not long ago, they came up with the idea of splitting their DVD and online streaming services. Qwikster was a spinoff company formed to handle the DVD mailing service. People were outraged and hated having to use two different services for their movies, and fortunately for Netflix they made a smart decision to kill Qwikster within a month of it's launch.
Enron of course had numerous problems and forms of illegal activity that lead to their demise. One of the funniest, however, was their policy to pay executives for simply coming up with an idea regardless of whether they actually used it. The conversation likely went "It would be great if I could get paid for all these great ideas I can't implement." "How about we do that then?" "That's an amazing idea! Have a bonus!"
Digg was similar to Reddit in that it used votes to show users the best news articles from around the web. One update to the site in particular killed it though: They made it so that sponsored posts and top-user submitted content was wayyy too common and flooded people's feeds, causing users to go on a mass exodus to the now-huge site Reddit. Some form of Digg still sits out there, with a tiny userbase compared to what it once was.
Some may remember the popular show "Fear Factor." It was revived late 2011 , only to be canceled again in May of 2012. The reasons were varied, but a likely huge part was a lawsuit that developed from their decision not to air an episode titled "Hee Haw! Hee Haw!" in which contestants hat to drink Donkey semen.... disgusting.
Western Union is known now for money-transfer services, but they didn't used to be that way. They were a telegram service first. Alexander Graham Bell offered to sell them the Telephone for $100,000 (a lot at the time), and they laughed it off. If only they knew the future would be completely filled with almost nothing but telephones..
The SciFi channel used to be great at doing exactly what the name suggests: providing good Science Fiction content. ThenÉ They changed their name to SyFy and became too "cute", running more reality TV type shows. They might be going back to their roots soon, but for now they're driving themselves into their own grave.
SEARS used to be part of the backbone of America with their department stores and their catalogs. Their recent CEO Eddie Lampert took a very unusual methodology and brought it to Sears. He laid off tons of employees, cut back on so many expenses to the point of crippling their stores, and pit the workers who did remain against each other for benefits and bonuses. Sears lost half of it's value and closed over half of their stores in only five years. They're essentially liquidating in slow motion, and they are just a ghost of what they used to be.
Osborne Computer is the reason you will never know about that new iPhone until right before it releases. When Osborne started telling people far too early about how cool the SECOND Osborne computer would be, no one bought the first one anymore! The company never got to finish the second computer because they ran out of money due to no sales of the first computer and went out of business.
Circuit City is known today as somewhat of an afterthought business. A huge part of this is that bakcin 2000, they decided for some reason to stop selling appliances (a very stable market!) and decided to focus solely on consumer electronics like TVs. That didn't work out too well... They also fired every employee who was making a higher than average wage! So all the good employees got fired... Terrible decision.
Source
http://www.brainjet.com/random/5642/17-corporate-darwin-award-nominees-they-goofed#slide/1/0
