People Reveal Worst Corporate Decisions That Completely Ruined Their Companies Business r/AskReddit

what has been the best corporate darwin award a decision made by a company that basically killed the business this year powder a group that ran Park City Mountain Resort the number three family ski resort in the country got absorbed by Vail it's competition and removed from ownership of its resort why because after 20 years of having the greatest lease in history about one hundred and fifty thousand a year for a resort that grosses millions and millions the end of the least time rolled around and they forgot to renew it literally that's it someone didn't take down a note and they turned their paperwork in three days late got sued and lost everything do your paperwork there's a restaurant in Austin that has really great chicken wings at one point a few years back the wings were taken off the menu because they were too popular and slowing down the kitchen that lasted about a month before someone realized it was a better idea to put some time and effort into improving the kitchen rather than kill off their best-selling item Blockbuster not buying netflix for fifty million dollars edit netflix is now worth about twenty eight billion dollars kodak telling the creator of digital photography to go duck himself sad thing is they had the technology first on the 70s and put it off for so long because the cost would be so large for consumers then they just totally mistimed everything they dug their own grave kodak slogan should be you shoot the pictures we shoot ourselves in the foot if we're going with recently Eddie Lampert the CEO of Sears is one of the best contenders for the corporate Darwin award he's a name brand loving free-market ideology who attempted to take his non reality-based style of life out of the lobbyists slash 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 our sources and pay under the delusion that the company would benefit for 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 buy my space for five hundred and eighty million dollars and then scare away users with ads intended to generate profit users leave my space and join Facebook sell my space for thirty eight million dollars ouch Circuit City making the decision to no longer sell appliances no matter how bad the economy is people will still buy refrigerators washers vacuums etc but they will wait on TVs and video games selling off Carmack's was pretty stupid too and speaking of Circuit City laying off the higher paid employees and keeping all the lower paid employees apparently never connecting the dots on level of products knowledge equals level of compensation I remember going into a Circuit City just as the nosedive began and a young man telling me outright that all the good people will let go he wasn't being rude or apathetic just being honest I hope he landed on his feet good guy Gerald Ratner called his own product total crap and inadvertently white 500 million pounds from the company's value he compounded this by going on to remark that some of the earrings were cheaper than an M and s prawn sandwich but probably wouldn't last as long dumb move but the dude has a great sense of humor reminds me of the Osman effect the Osmond one was the first commercially successful PC the founder pre announced the successor to the Osman one way before it was ready to come to market his announcement touting how good the next machine would be killed demand for the husband won the company then ran out of money and couldn't bring the successor to market declared bankruptcy and died 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 10 years before that was feasible ironically the documentary is available on Netflix pretty sure the executives did that on purpose say I sure would like to be paid for coming up with ideas but not actually implementing them then why don't we my god that's an amazing idea have a bonus Netflix came really close before they wised up and shelved Qwikster what was quick stir a few years back Netflix announced that it was dividing its services into two different companies all of the Instant Streaming would be handled by Netflix while the physical DVDs would be under a new service called quick stir it was universally hated by the internet as a whole because back then about 12 million users had joined streaming and DVD packages the change basically forced them to reconfigure their Netflix subscription to streaming only and then sign up for a quick stir account to get the DVDs it basically required two accounts for users to get what they were previously getting from one account the quickster idea was cancelled within a month we love rice here in the Philippines there's a popular and relatively cheap Japanese restaurant that served unlimited rice for every meal and it was very known for it some brilliant guy decides to take it out word gets around and people stop going there a few months later they decide to put the promo back but the customers just stopped coming that would be like Olive Garden deciding that breadsticks are no longer unlimited I would never go back I officially nominate Schlitz beer for the corporate Darwin Hall of Fame number one beer in America by far in the late sixties / early seventies when some genius at the head office decided to change the recipe to save money on ingredients sales fell off a cliff almost immediately they changed back to the old recipe but it was already too late the old Schlitz drinkers stayed away in droves the company remains up Schlitz creek without a paddle we actually had Schlitz as a case study in business school management went through ten successive rounds of cost-cutting incremental E decreasing product quality with each round the last cost-cutting was the death Neal they stopped filtering out the last little least flakes from the final product figuring that consumers wouldn't mind little flecks of least in the head of their beer lesson learned consumers typically don't notice that drop in quality going from A to B but definitely noticed that dropped from A to G a dig that irreversible system upgrade never use dig what exactly happened originally dig was basically a news entertainment site where the top stories were voted up by users similar to Reddit they changed it around so that there was a much heavier emphasis on connecting to people and organizations so you had your own personal front page influenced by which people you followed a bit more like Twitter people were already annoyed by the influence of the most heavy users at the time and the change made it way worse it was like they took one thing about the site that annoyed people and made it the main feature sci-fi channel changing their name to sci-fi and replacing their good shows that is battle stir with shitty reality TV they're lucky they still exist at all this won't be a top story but one of amazing stupidity it was the late 1990s the middle of the tech boom in San Diego one of the hearts of the tech boom a small consulting company had about 100 programmers contracted out to about a dozen companies the profits were huge the company charged $200 per hour per person paid the employee about $70 per hour pocketed the rest the only overhead was the small main office a recruiter an HR person and an accountant to handle all of that money and small expenses then the company scored big microsoft headquarters in seattle wanted some of these people contracting about a dozen of them to start the profits were so huge the programmers were flown back to San Diego each weekend the deal was still per hour and Microsoft loved the people and asked them to work through weekends saving the company the cost of airfare and bringing in a couple of extra million dollars so two months later it Spencer reports are getting kicked back the company was refusing to pay large parking fees for the people who worked seven days a week for three and four weeks the company accountant said they should have taken a cab to the airport since they were gone for three weeks after reminding the accountant that they had not intended to stay that long that they did sue at company requests they were still refused reimbursement on parking five of those contractors resigned due to the parking payment issue and others slowly followed the Microsoft deal collapsed because they kept losing people and within the year the whole company folded yes this company folded during the tech boom in a boom city hundreds of millions of dollars lost because they wanted to screw over their most income producing employees over maybe $2,000 in parking fees Groupon isn't dead yet but Google offered to buy them then a two-year old local e-commerce startup 45.7 five billion dollars in the fall of 2010 Groupon didn't accept the offer and now there are countless Google Groupon alternatives when someone offers you six billion dollars for something you just created I say you accept it take the money and invent something else take the money and invent something else or ya know just retire Harland Clark they print Aven catalogs checks scantron forms etc their business is dying because they leveraged everything on check renting they do something like 98% of checks in the US if you have a checkbook I bet $10 it's a Harland Clark check so anyway they spun up a company called free patty a 100 million investment super custom stationery printing they organized call centers set up hundred line VoIP systems in anticipation of the millions of orders they were going to get dozens of artists recruited no one bothered to tell them that the advertising platform they'd already blown 40 million dollars on one didn't work and to targeted an audience that had very little interest in old-school stationery or even one-off custom car it's advertising platform chosen Facebook total orders taken 13 Kmart took out a whole bunch of debt to buy back their shares looking to raise their share price when news of this came out Walmart which had basically no debt at the time decided that it would be a good time to start a price war Kmart had to pay off interest whereas Walmart had little to no interest payments to make so by lowering the profit margin to a point where Kmart had to cut back on their internal investment Walmart surged ahead while Kmart lagged behind the biggest cut came out made I believe was capex capital expenditures things like making new stores and up keeping current ones and that's a major reason why Walmart is so popular and booming whereas Kmart has always just seemed a little off this will go unnoticed because it's not a huge company however I audited an air cargo company and essentially a member of the legal department had shifted the TNCs on their lease contracts basically they rearranged the terms and in the process of copy plus pasting the information they unintentionally cut the part out which pushed all the normal flying expenses back onto the client fuel landing fees all the stuff a normal air cargo contract would come with the contract was for their biggest client and for a while the client signed the papers and paid as they normally have until the client got all new management the new management at the client reviewed all contract terms and found they no longer had to pay these expenses they previously were so they didn't for two years when the company I audited found receivables aged greater than two years they began to flip out and demand payment the customer basically said I have no obligation to pay so we are not the company I audited went back to the agreement where they pretty much said oh dock the receivable was not collectible so they wrote it off forcing them to take an enormous hit on their income statement which in turn caused them to break a debt covenant and all their long-term debt became current boom dead in the water all due to copy and paste error TLE our company went bankrupt because lawyers can't copy + paste [Music]

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Id: Shdt52gakmY

Length: 13min 24sec (804 seconds)

Published: Sun Aug 04 2019