Chris Blattman

“What has been the best corporate Darwin Award? A decision made by a company that basically killed the business.”

A reddit thread. Some of the best answers:

  • George Lucas wanted X salary to direct Star Wars. The studio thought it was too much. Of course they thought the movie might make money, but they didn’t really think it would become the powerful franchise we know it today. So George said “I’ll take a pay cut of $20K, if you give me all the merchandising rights”. Those rights were part of the $4 billion that Disney just paid him for Lucasfilms. Fox lost billions over several decades, in order to save $20K back in the 70’s.

  • Eddie Lampert, the CEO of Sears is one of the best contenders for the Corporate Darwin Award. He’s an Ayn Rand-loving, free-market ideologist who attempted to take his non-reality-based style of life out of the lobbyist/Congress rigged world of hedge funds and into retail. He laid off, cut, and trimmed back everything he could and forced departments, managers, and employees to fight against each other for resources and pay under the delusion that the company would benefit from a survival of the fittest atmosphere. Since that time, Sears has lost half its value in five years and has closed more than half of its stores, not to mention just about destroyed one of the oldest and most trusted brands in the history of the United States.

  • Enron for paying their executives “idea bonuses” before the ideas turned a profit. They paid one guy millions for inventing an online movie downloading service about ten years before that was feasible. Ironically, the documentary is available on Netflix.

42 Responses

  1. I assume that you know this UK effort:
    1 – The most famous of them all, so much so that such gaffes are now known as “doing a Ratner”.
    Gerald Ratner wiped £500 million from the value of Ratners jewellers with one speech in 1991.
    He said: “We also do cut-glass sherry decanters complete with six glasses on a silver-plated tray that your butler can serve you drinks on, all for £4.95. People say, ‘How can you sell this for such a low price?’ I say, because it’s total crap.”

    He added that his stores’ earrings were “cheaper than an M&S prawn sandwich but probably wouldn’t last as long”.

  2. The Sears one is a pretty cheap and ignorant shot against free-market beliefs. I don’t understand how someone could complain about the free market and about “the lobbyist/Congress rigged world of hedge funds” in the same sentence. When lobbyists and Congress rig markets, isn’t that not the free market by definition? It seems like that person has lumped all the things he doesn’t like under “the free market.”

  3. “It is hard for us with, and without being flippant, to even see a scenario within any kind of realm of reason that would see us losing $1 in any of those transactions,” Joe Cassano, AIG

  4. 1 answer killed a business
    1 answer shows the way there
    1 answer was a stupid biz decision hindsight, but the biz is still running, decades later

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