"Kay’s analysis absolutely applies to any company that has optimized itself for its shareholders; extracting the value of a competitive advantage is profitable, until it isn’t. And then, creative destruction dictates the company, having shined so brightly, contracts and ultimately burns out. Still, it’s not clear that not pursuing such a strategy is better. Amazon is a particularly relevant example: from a profit and dividend perspective, one would have been better off investing in Microsoft, the last decade notwithstanding. If one were to truly embrace capitalism and the idea of shareholder value, isn’t Microsoft the better company? Yet, it’s hard to imagine living without Amazon, or Apple. It’s far too easy to imagine living without Microsoft. Ballmer did exactly what our capitalist system dictate he do: he maximized profits to the benefit of Microsoft’s shareholders. The implications of suggesting he was a failure are far more profound than most of his many critics likely realize."
Posted on: Mon, 30 Sep 2013 16:40:16 +0000
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