9 Key Characteristics of a Successful Distribution Business

At its core, a successful distribution business functions to add value to the customer, by flawlessly delivering the desired product or set of products at the right point in time, without quality defects and in the most cost-effective fashion. It is imperative that a successful distribution business operates with the costumers top-of-mind.

According to Jozef Opdeweegh, a Miami businessman with over 17 years of experience as CEO, Chairman and Board Member of private and public companies, there are 9 key tenets that make up an ideal distribution business model, that will not only emanate in the highest level of customer satisfaction but will also reward associates for their contribution to the success of the company and shareholders for their confidence in the company’s strategic plan.

  1. Quality of operations

The breadth of the product range, fill rate, on-time delivery, competitive pricing, a multi-channel approach, along with extensive and up-to-date product information, are vital in creating an excellent customer experience. In order to satisfy these demands, the logistics operations behind the distribution business need to be of exceptional quality: qualified and well-trained personnel, real-time inventory visibility throughout the cycle, continual optimization of the process flow inside the distribution centers, a relentless focus on continuous improvement/six sigma/lean manufacturing and the automation of put away and pick processes are key focal points to differentiate the business from its competitors. Furthermore, the choice of like-minded transportation and last-mile delivery partners who equally view customer service as their core mission is key to the overall customer experience.

  1. Organic Growth

The key differentiating factor as well as the proof of concept, and one of the main drivers of shareholder wealth creation is the achievement of organic growth exceeding that of the relevant competition. Customer empathy, SKU (Stock Keeping Units) proliferation, relevant information and excellent knowledge about the product range, as well as the overall quality each aspect of the supply chain are indispensable characteristics that define a better distribution business. This type of distribution business will garner outsized customer loyalty and recurring sales.

  1. Gross Margin Management

One of the most relevant success factors for a distribution business is the laser-focused management of gross margin, both in percent of sales and in terms of currency. In some instances, the sales force has not be provided with the analytical tools to allow them for the promotion of those products that generate the highest margin potential. This is of particular importance in a landscape with certain SKUs (Stock Keeping Units) that have identical characteristics and can serve the customer requirements with the same effectiveness, which is often the case. Additionally, in their quest for revenue, the sales force may be inclined to engage in price discounting, which harms the margin potential of the sale. Finally, a number of distribution organizations lack the sophistication to keep track of ancillary services that may have been offered to the customers or are reluctant to charge for those services, which further erodes the margin.

The key is to develop the business analytics and IT infrastructure that will allow for the identification and sale of the highest margin product in order to serve customer’s needs at the right price. This also allows for the appropriate charge to the customer for the ancillary services and the delivery method he or she enjoys.

  1. Back Office Efficiency

Many distribution businesses maintain a back office that is inert, too large and costly. By virtue of their business model, large distribution businesses operate via geographically dispersed distribution centers. Lack of an integrated ERP (Enterprise Resource Planning) solution and the absence of a standardized operating platform often create a detrimentally decentralized management structure. This leads to a large discrepancy in customer experience, in product and service offerings, and in the quality of operations across geographies. Furthermore, it may lead to an erosion of the leverage the distributor otherwise would be able to exercise on its suppliers. Lastly, it creates duplication in management and support structures – efforts and costs that can easily be avoided. In a successful distribution business, the operating system and the SKU management should be centrally managed, with the execution residing in the different regions, but based on a provided prescriptive playbook.

  1. Network Optimization

A large number of distribution businesses operate from a suboptimal set of distribution centers. Often their network consists of a combination of too many facilities and less than optimally located distribution centers from a geographic perspective. This leads to duplicative inventory and inflated working capital requirements. A distribution business needs to constantly assess the size and location of its distribution facilities, so it can live up to its (next day) customer delivery promises from the fewest number of distribution centers. Case studies show huge savings can be generated in the area of network optimization, with a payback that often is less than 12 months, while at the same point in time enhancing the overall customer experience.

  1. E-commerce

Since an online sales model does not require brick and mortar, and it does not require a direct sales force and the related costs, the bottom-line profitability of e-commerce sales vastly exceeds the profitability of the same SKU through another sales channel. A successful e-commerce sales effort requires a user-friendly web experience, impactful SEO efforts, detailed product information, breadth and availability of inventory, and on-time delivery of the entire order. It is also essential to have a simple return policy and a great back office to deal with product information, defects, and returns. Online sales may be boosted through the creation of an online user community consisting of customers who have purchased the product and can provide others with first-hand product information and applicability. Most often than not, e-commerce is one of the channels through which sales can be generated, in a multi-channel strategy that also includes direct sales and catalog sales. It is most certainly the most cost-effective and agile sales channel.

  1. ERP-Solutions (Enterprise Resource Planning)

A distribution business may handle as many as 1 million distinct SKUs. In order to effectively run the distribution organization, it is imperative the company has real-time global inventory visibility to know exactly where different SKUs are stocked. This level of visibility allows for the avoidance of duplicative inventory, the calculation of appropriate inventory levels in the network through demand forecasting, and the minimization of risk of obsolescence. In many regards, the ERP solution is the engine of the distribution organization and is an invaluable part of network optimization. While implementation of a state-of-the-art ERP solution may be costly and time-consuming, with the cost amounting to as much as the equivalent of one year EBITDA (Earnings Before Interest, Taxes, Appreciation & Amortization), it is hard to imagine a world-class distributor that does not possess such a tool.

  1. Customer and Supplier Segmentation

In any distribution business, there are a number of items that are high volume. Conversely, there typically are a number of products that are only sold very occasionally and may have a negative impact on the profitability of the organization. In a similar vein, the average distribution business will spend time, effort and money maintaining relations with suppliers who provide low-demand products. It is important to continually reassess the contribution margin of low-selling items and to cut certain parts of the long tail, both in product and in supplier range.

  1. Private Label

A distributor can significantly enhance its gross margins by focusing on the sale of private-label items, or items that have the desired functionality but that are being sourced through contract manufacturing and branded under a proprietary brand name. Certain competing suppliers may react negatively towards competing private-label products. Nevertheless, in the area of more generic SKUs, a distributor should aim at selling its own branded products and ideally, private labels will constitute 15% or more of overall revenue.

Jozef Opdeweegh: 7 Reasons Why Private Equity Acquirers Fail to Mesh With Incumbent Leadership Teams

When a private equity fund sells a successful company, the company’s leadership team would seem to be a valuable asset for the new owner. After all, the team built shareholder wealth and it has intimate knowledge of the business. But in many cases, the executive leadership team does not survive the change in ownership, even if its performance was stellar. According to longtime CEO Jozef ”Jos” Opdeweegh, ”Unless the ownership transition is undertaken with great care, it can undermine the continued success of the company and its value.”

Opdeweegh, a veteran of four private-equity company transitions, notes that when a private equity fund initially invests in a company, it is common for the purchase to be based on an investment thesis. ”Such a thesis may be based on premises like turn-around, M&A, organic growth, SG&A reduction, balance sheet optimization or a combination of these elements. The company leadership team executes to that thesis to build shareholder wealth. When the end of the investment horizon approaches, a private equity fund will sell the business to the highest bidder.”

So, what are the issues that can prevent a new owner from meshing with the incumbent leadership team? Below, Opdeweegh explains why, when, and where things tend to go awry.

1. The inability of the leadership team to participate in choosing the new owner

In an auction, which is the typical process used to sell a company to the highest bidder, the executive team is not typically invited to weigh in on the selection of the new owners. According to Opdeweegh, ”This can lead to a dissonant outcome. Oftentimes, a clash of strategic views and corporate cultures occurs.”

2. The new owner’s failure to recognize the importance of the management team

”Some private equity owners view a management team as an end to a means, rather than as a valuable and continuing asset,” cautions Opdeweegh. ”In determining their future strategy, they quite often they will trust the judgment of a less qualified consultant over that of a seasoned management team with a proven track record.” Additionally, notes Opdeweegh, ”Private equity fund leadership often fails to appreciate how challenging it will be to achieve the post-purchase target return, and consequently, they fail to recognize the importance of the management team.”

3. An unbalanced payout to the owner compared to the management team.

Opdeweegh says, ”There is an institutionalized lack of balance in the economics of private equity deals. It is not uncommon to have deals in which an individual private equity partner earns a larger payout than the entire management group.” He goes on to explain that the inequity in compensation illustrates an apparent lack of appreciation for the complex and demanding work of management teams.

4. A clash of corporate cultures

”It is not atypical,” says Opdeweegh, ”for a clash of cultures to arise between a new shareholder group and an existing executive team.” The acquired executive team typically has worked together for an extensive period and has developed a shared set of core values. This set of values, which constitutes the corporate culture, may be very different from the behaviors the new owners wish to instill into their company vision. Says Opdeweegh, ”If values such as fairness, openness, inclusiveness, the speed of decision-making and respect are not aligned, cultural and business issues will surface.”

5. Preconceived notions and impulsive decision-making by new owners

Opdeweegh says that new owners often jump to conclusions when assessing the talent in their acquired business. For instance, during management presentations, they might conclude the CFO is lackluster or the COO is nontraditional. ”A rush to judgment is not only unfair to management,” he warns, ”it can lead to a crisis for the new owners because a forced executive replacement usually triggers an executive team exodus. Such a migration will significantly impact the business with the loss of much institutional knowledge.” Opdeweegh adds that hasty management churn can easily result in a three to four-year setback in revenue, EBITDA trajectory, and performance.

6. Disagreement over the new strategic plan

Speaking from his experience in the business, Opdeweegh explains how a new owner will develop a strategic plan to form the foundation of their investment decision. ”This strategic plan is based on assumptions relating to organic growth rate, diversification across geographies, customer and industry verticals, M&A activity, balance sheet structure, cost of the back-office functions, and other relevant aspects of value creation. The incumbent executive team may view some important aspects of the plan as unattainable or undesirable for shareholders’ wealth creation.” Disagreement about the strategic direction of the company and the key underlying initiatives is another classic reason for a failed relationship between the acquirer and the acquired executive team.

7. Second guessing of management team decisions by the new owner

Even if the new owner and the incumbent management team agree on the strategic plan, the new owner can undermine success by continually second-guessing management decisions. Says Opdeweegh, ”Private equity funds recruit from a pool of the best and brightest professionals, but these individuals have spent their careers building experience in the grueling PE environment and therefore tend to lack concrete corporate leadership experience. Undoubtedly with the best of intentions, these hardened professionals will have an opinion about many facets of the day-to-day, tactical and strategic management of their portfolio companies.” Adds Opdeweegh, ”Consequently, the management team spends an inordinate amount of time communicating or justifying the rationale of certain decisions to the shareholders. The resulting drag on time and morale can cripple efforts to reach target returns.”

Jozef Opdeweegh on the Importance and Requirement of Standardizing Operational Practices

Large businesses often operate in a number of geographically-dispersed facilities, which typically overlap in terms of the services provided or products produced. Moreover, these businesses regularly serve the same customers out of a number of different facilities, especially if the customers span a large geography. And despite the logistical challenges of managing multiple locations, all customers rightly have high expectations around consistency in terms of quality, customer service, and customer reporting, no matter what facilities are involved in their product or service delivery.

Unfortunately, too many companies still operate in a disjointed environment where either legacy, a false interpretation of the concept of empowerment, or the singular perspective of the individual plant manager determines the organization’s processes and procedures. This approach, however, hinders corporations from achieving their full potential in terms of customer service and return-on-capital-employed.

The implementation of a rigorous and prescriptive universal operating structure is the most effective way to guarantee the highest level of standardization and scalability to deliver the greatest operational efficiencies and best performance against relevant customer KPIs.

Jozef, ‘Jos’, Opdeweegh has been a CEO of large international companies for close to two decades and recognizes the importance of standardizing operational practices for optimal efficiency. In the following, he shares his perspective and insights on the importance and hallmarks of standardized operational procedures.

Aligning Interconnected Facilities

When a company operates a number of geographically-dispersed facilities, they are likely interconnected in one or more of the following ways. They may share a supplier/customer relationship, with one facility producing components that are used further down in the assembly or production process in another company-operated facility. In other cases, such as in the distribution industry, facilities are interconnected as the products are collected and stored, or cross-docked, in various locations. More simply, the organization may serve the same customer out of different facilities.

In the case of interconnected facilities, though important, it is arguably not the average performance of the company against a number of critical customer KPIs that is most relevant. Instead, the variance around the mean, and specifically the negative outliers, is the most relevant component. While these worst performers will mathematically drag down the average performance of the company against relevant KPIs, they will have an even more harmful impact on the customer’s perception of the quality of operations. The quality of the end product is only as good as the weakest link in the chain.

Scalability of the Platform

Since it is a strategic imperative of companies to grow, companies with a dispersed landscape of operating entities will typically increase the number of facilities and its geographic reach over time. In an environment where a consistent operating system is successfully deployed, launching incremental facilities becomes a much easier task. The platform is much more scalable, as the processes and procedures that determine how the operations and support functions inside the new facility will be organized are already largely determined. Some minor tweaking may be required to accommodate a new service offering, a new product design, or different customer requirements, but the core of the proven solution will already be solidified.

Mobility of Human Talent

When a standardized operating system is in place, human talent is much more interchangeable and transferrable. Since the company’s professionals have been trained in a standardized environment, they can easily and efficiently be deployed to fill talent gaps in other operations in the group or to help address quality deficiencies in sister facilities. Additionally, these resources are ideal in helping to launch new facilities in different geographies, or new service or production offerings as knowledge is portable, universally deployable, and highly valuable.

Continuous Improvement

In a standardized operating environment, continuous improvement is a key imperative. Whether the improvement initiative finds its origin in one of the company’s facilities where a colleague has devised a better way of performing a specific task, or in an idea that emanates from a continuous improvement team, once the idea has been tried and tested it should be rolled out and deployed throughout the entire organization. In the standardized environment, nobody can take a shortcut. A bad idea will not be implemented in any location, and a good idea will find its way to all locations.

As such, to provide the best service to customers in the most cost efficient and effective manner, Jos Opdeweegh suggests placing a dedicated focus on the development and implementation of a comprehensive set of processes and procedures from the outset.

Executives exist to serve the organization, not the other way around

A successful organization is dependent on several factors, one of the biggest being internal organizational structure. When running a business, big or small, this is one of the first elements needed to function, yet often times it’s overlooked and falls victim to outdated values. 

It’s imperative for executives of a company to reverse how they may naturally be inclined to run their organization and create an organizational structure that is rooted in the customer and employees. 

The outdated hierarchical structure

In a traditional strict hierarchy, decision-making is the sole prerogative of a select group of senior leaders in the organization. It’s an approach that centralizes power and is steeped in the erroneous belief that a happy few leaders are best placed to make the right decisions for the company on a strategic, tactical, and even day-to-day level. 

This pyramidal structure is a very autocratic and even militaristic approach to running an organization, whereby decisions are pushed down on colleagues without the solicitation of input or the willingness to listen to other ideas and approaches. As a consequence, the creativity and the valuable input of those in the organization who are closer to the challenge or the problem that needs to be addressed, gets lost. And over time, the organization numbs down and resigns to the limitations of the hierarchical structure.

Shortfalls of the traditional hierarchy

Beyond being an antiquated organizational structure, hierarchical leadership also unleashes many obstacles and stumbling blocks on a company, further complicating and hamper achievement of key goals. 

Negative impacts on employee morale. Colleagues prefer to work in an environment that is inclusive, in a structure that values their input and contribution. The workforce of a company consists of individuals with varying backgrounds and experiences whose input enhances the long-term success of the company. People want much more from their professional life than the sheer repetition of a number of narrowly defined tasks, or the execution of top-down instructions without debate or input. A strict hierarchy leaves colleagues with the feeling of being underutilized and undervalued. It negatively impacts the feeling of overall wellbeing and belonging in the extended family that constitutes a successful company.

Employee churn and loss of talent. Companies that adhere to a strict hierarchy are engaging in paradoxical behavior. On one hand, their human resources department is likely spending a tremendous amount of effort and monetary resources to try to identify and recruit the best possible talent. On the other hand, once the talent has been on-boarded, the organization has little interest in the individual contribution of the valuable new recruits. This will lead to a situation where the high potentials quickly get frustrated with the culture they are forcefully being inundated with and will decide to leave the organization in due time. 

The road to mediocrity. The combination of a scenario where an organization stymies creativity through centralized top-down decision-making will over time create a workforce that is mediocre in terms of overall quality and core behaviors. The high potentials will leave the organization, frustrated because of their lack of ability to influence to company’s decisions and direction. At the same point in time, the company – through its performance management tools – will decide to part company with the worst performing co-workers. In balance, those who will survive in the long term are those who never challenge the status quo, who are risk adverse and non-inquisitive.

Suboptimal decision making. Top-down decision making, without regard for the input and knowledge of those colleagues who are much closer to the issue and much more qualified to make or at least contribute to the right decision, is by definition suboptimal. Why would somebody come forward with a novel angle to an issue or an opportunity if that person knows that the sound advice will fall on deaf ears? A number of key considerations and knowledge sources that would greatly enhance the quality of the decision are lost. Therefore, decisions that are made in isolation and pushed down to the mass organization are unbalanced and uninformed.

The shift to the inverted pyramid and servant leadership 

Rather than applying an outdated steep hierarchy, executives should try to come to grips with the reality that the company does not revolve around them, but around its valuable customers and its hard-working colleagues. The leadership team really is in essence an enabler, an instrument to create an environment that guarantees the largest probability of success for the company and its key stakeholders: customers, colleagues, investors, and lenders. 

In organizational structure, which can best be described as “the inverted pyramid”, customer and customer-facing colleagues are viewed as the most important asset of the company. As we go down on the pyramid, we see the executives all the way at the bottom, as an indication of the reality that their primary task is to serve the organization and all of its constituencies. 

Customer-centric values 

In addition to the notion that the leadership works for the organization and its valued colleagues – not the other way around – the inverted pyramid also squarely puts the customers at the center of its purpose. Without the customers, the company has no reason to exist. In this context, it’s important to note that every individual is a salesperson for the organization. Driving consistent core behaviors, a positive attitude, and a high level of engagement with the workforce are the best possible ways for supporting incremental sales. 

When a prospective customer is looking to source business with a new provider, they are not looking for yet another glossy presentation. They want to experience in practice whether what is being portrayed in the sales deck matches the reality on the shop floor. Nothing will convince that prospective buyer more than a visit to a state-of-the-art facility that is already in operation and that is populated with a knowledgeable and enthusiastic workforce that can energetically articulate what processes they are responsible for, and how their hard work fits into the bigger strategic direction of the company.

Implementing a solid organizational structure will create a positive ripple effect that will reverberate throughout a company all the way to its customers. Success cannot happen if there is not a strong inner foundation for employees to be proud of and support, and this all begins by flipping the organizational pyramid.

Why Companies Make Harmful Decisions

Why is it that companies make bad decisions?

In posing that question, I’m not referring to those infamous bad calls like Decca records rejection of The Beatles, or Blockbuster’s rebuff of a joint venture with Netflix. These are human mistakes — and with the benefit of hindsight, we can all of us believe we’d have made a smarter choice.

Rather, what interests me is why, given all the checks and balances, so many companies appear to take carefully thought through decisions that actively harm the interests of their stakeholders?

A Harvard Business Report estimated that up to 90 percent of all mergers and acquisitions fail; similar claims can be made for internal transformation projects, especially in the IT and digital sphere. Whatever way you look at the problem, it seems that despite access to the smartest minds, sophisticated forecasting tools and due diligence warnings, business leaders continue to get it wrong.

Observation has taught me there’s no single explanation. But after twenty years of corporate decision making — and with the scars to prove it — I’ve at least become attentive to some of the warning signs.

What follows are therefore my insights from experience. Interpret them as you wish, for every situation will be different — which leads nicely to my first observation, that gets straight to the root of the problem.

Complexity

The unfortunate reality is that many strategic decisions are not as binary as whether or not to award a recording contract — rather, they are multifaceted, involving forecasts of markets, competitors, savings and synergies… And what’s more, many of the situations are particular to circumstance, so references are seldom available or even helpful if they were.

In these sorts of complex situations, we all of us — and organizations are no different — resort to simplified solutions that allow for a quicker way through the maze. Academics call these heuristics — we know them as rules of thumb, best estimates, benchmarking and the like.

The trouble with heuristics, is that although they are to some extent inevitable, we risk addressing a simpler problem than the one we face — and worse, our biases and preferences creep into the proposed solution to issues that have been framed for our convenience rather than the reality of the situation.

One antidote — so far as any is effective — is to be extremely careful when simplifying or estimating significant variables. Any benchmarks we chose and assumptions we make, must also be modeled over a wide range of outcomes. The greatest danger of heuristics is actually a regression to the mean where risks and opportunities are smoothed into a safe bet which, in the event, turns out to be anything but.

Impulsiveness

Linked to our tendency to simplify, is a pressure to act — fueled by a deeply ingrained corporate mindset that regards not doing so as a missed opportunity or cultural failing. Organizations increasingly demand that their leaders move at pace, and while this has its benefits, it can also lead to premature decisions that are ahead of the curve.

In transformational projects, the term ‘bleeding edge’ refers to the impact of decisions — typically, those involving the early adoption of technology — which lead to unexpected costs and consequences which harm rather than enhance competitiveness. The underlying reason is that supposed ‘first-mover advantage’ inevitably comes with significantly greater risks. In almost any sizeable market, the lesson of case study after case study is that a little more patience would often have led to a better outcome.

To some extent, this is as much an institutional as an individual problem. I often sense that companies weigh the ‘regret risk’ of missed opportunities more heavily than they do the years of successful delivery. Investors — like sports fans — are both impatient for success and quick to point out the triumphs of others. What they are less good at doing, is recognizing the potential for pitfalls and giving due regard to the judgment of those who avoid them.

There is no cure-all solution to impulsiveness, but it is good practice to ensure decisions can be made over sensible timeframes, to resist the pressure to lead on every front, and to establish agreed expectations for investment and return over time — and then stick to them!

Reward versus Risk

At the heart of the type of decisions we’re discussing is the assessment of risk versus reward.

Of course, no opportunity of any consequence is a certainty — investors, colleagues and customers all understand that. It’s also fair to say that most successful executives need to be less risk averse than say, librarians. But while that’s a good thing, my experience is that risk and reward assessments are often made in a manner which gives undue weight to one over the other.

Think for a moment of all those inspirational quotes you’ve seen at management conferences: Whatever you dream, begin it — for boldness has power and magic! (Goethe); Security is mostly superstition… (Hellen Keller); Do not fear mistakes; there are none!’ (Miles Davis)

Extracts like these can be fine as a means to inspire a sales team or encourage creativity, but their underlying message can — and in my experience often does — contribute to a mindset which lionizes risk taking.

I’m not suggesting that the potted wisdom of Miles Davis is taken too literally by senior executives. But when it comes to major strategic decisions, the notion that boldness equates to virtue remains a powerful force, and a significant hindrance to a full and objective assessment of downside consequences.

The dream of reason

We should also recognize that objectivity is more of an attitude than a destination we ever arrive at. The belief that we can accurately predict the future through analysis and situational modeling alone has been the downfall of many an economist — or for that matter politician.

In practice, we live in a less than rational, often emotional, and certainly disruptive world — companies and organizations can never fully predict the response of others, or indeed, the impact of change on their people and its consequent effect on a multitude of other factors. Which is why softer considerations are just as vital.

Culture and Communications

In analyzing harmful decisions, the diagnosis often points less to the actions we have taken, than the way we went about them.

For example, bringing together two organizations might seem straightforward on paper — but as with personal relationships, there’s more to a good match than aligning compatible skills and qualities. Too many mergers are predicated on the assumption that the mores of one party can be imposed on the other — giving scant regard to the importance of culture, communication and values as drivers of performance.

Successful ventures pay attention to these softer qualities, avoiding the imposition of changes that are diametrically opposed to the past, or rewarding individuals with extended remits for which they have little understanding.

The same cultural empathy should apply to for our search for synergies, sales growth or even colleague engagement — we should not assume that crashing together, or worse, imposing one style on the other, will bring success.

Think Borg and McEnroe — both exceptional tennis players, but not the most compatible doubles pairing.

Imbalance of stakeholders

This understanding of partnership is never more important than in the balance of stakeholder interests. All commercial organizations have at least three key constituencies: their investors, employees and customers. And while all of these will want the company to prosper, they each have subtly different needs and emphasis.

Successful organizations make decisions in a way that ensures all stakeholders take a fair share of the risks and rewards. That means investors accepting there are other calls on cash than paying dividends; employees understanding that job security comes from embracing change, and customers having realistic expectations on price and value despite the leverage they may have.

Conversely, if the interests of one stakeholder group begins to dominate, it can be a green light to harmful decision making. Over the lifecycle of a business, there will, of course, be times of different emphasis — but on the whole, sustainable decisions are founded on meeting the needs of each constituency, while avoiding the ascendancy of any.

And finally…

I could go on with a host of other reasons…

But I’m conscious there’s a limit to the value of observations from experience, and particularly aware that hindsight makes prophets of us all — or in my case, the best Monday morning quarterback to never grace the field.

Perhaps the most important thing, in seeking to understand why so many companies make harmful choices, is to recognize it’s not the corporate entity that makes those decisions at all — it is people!

And as human beings, we are all of us in equal part blessed and susceptible to the paradoxical mix of talents, frailties and hubris that drive our exceptional achievements as well as our greatest mistakes.