Corporations are people, too. Not in the sense that the Supreme Court ruled in Citizens United, when it allowed corporations the free speech rights accorded to citizens. No, I am referring to business obituaries. Dead companies, like dead people, enjoy the same euphemistic language treatment.
Few of us die these days. Visit any online memorial site or read a newspaper obituary and you’ll see. For the most part, we pass away. Some of us succumb to an illness; others are victims of fatal accidents. With the passing of time, our friends may even raise a glass and say that we cashed in our chips, bought the farm, met our maker, kicked the bucket or, bit the dust. I get it. Indirect language helps us deal with the pain and permanence of death.
I just don’t understand why we speak of corporate failures in a similar manner.
My informal survey of business executives suggests that corporations don’t fail (read: die). They may fold, go under, even shut down. At times, they persevere on institutional life-support by downsizing, restructuring, or filing for bankruptcy protection. As reported, it’s mostly passive stuff. Companies and, by default, their managers never actively fail.
For the mathematically inclined this should come as no surprise. If one were to total the cost savings and increased profits detailed in every LinkedIn profile the result would be staggering; with all that “found” money floating around, how could companies not succeed?
In all seriousness, one can learn a great deal by analyzing company failures . . . but only if we recognize them as such. What good is a quality system that never identifies a rejected part? There can be no corrective action without a nonconformity. The same measure applies to companies. Especially start-ups and small businesses.
So, do your part; help a startup. Describe a failure as a failure. Let weasel words die.
Mr. Dragone has spent the past twenty years as an acting/consulting CFO for a number of start-ups in a wide range of industries. Peter’s prior experience is that of a serial entrepreneur, managing various start-up and turnaround projects. He was a co-founder of Keurig.