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The stainless steel web

When self-confidence fails, caution rules. When timidity and unrestrained risk-aversion gain the upper hand, the kind of imaginative and bold initiatives that companies must make in order to sustain their rapid growth are forced to run a gauntlet of analysis and criticism that no suggestion, no venture not already proven successful, has a chance of surviving.

This is the source of paralysis, why companies fail to act even when there is, within the company, a broad consensus that problems exist, action is needed, and even agreement on the nature of the changes required. Even then, each specific recommendation finds itself stuck in a stainless steel web; the chances of it surviving all the individual sign-offs needed to be implemented are remote.

Here are some strands of the stainless steel web.

Each and every one of these concerns may be valid, and all of them, to the degree appropriate, should be weighed when considering a new product, changes to an existing product, or revisions in our pricing, discount structure, distribution channels, or marketing strategies. The difference between prudence and circumspection and becoming ensnared in the stainless steel web is the difference between a can-do spirit and a can't-do, passive outlook on the world, between action and reaction.

Paralysis in the face of opportunity sets in when the valid concerns and genuine difficulties posed by any initiative become viewed not as obstacles to be overcome, but insurmountable barriers blocking its implementation. If any proposal is subjected to an initiation ritual in which any black ball causes its rejection, the chances of any redirection in strategy occurring becomes vanishingly small. And as a company expands, diversifies, and operates in a larger and more complicated arena, the check-off boxes that can block action proliferate. As a suggestion is reviewed, its near-term difficulties and immediate risks come to outweigh the benefits which, though potentially large, are deferred into the future and subject to uncertainty.

In such an environment, an unambiguous statement of direction, strong and effective leadership, and continued follow-through by senior management is essential if the company is to progress. Otherwise, the parochial concerns of individual departments will block any and all changes to the way they've become accustomed to doing their work.

This is the stainless steel web--the timidity trap. It seizes mature companies who can always seem to amass a hundred reasons not to do something against one or two reasons in favour, even if the potential benefits include saving the company. It supplants the entrepreneur's approach, ``try it and see if it works,'' with the central planner's: ``let's do some market research and develop a matrix for evaluating this proposal.'' It is the abandonment of judgement in favour of calculation.

You cannot lead an industry by studying the actions of your competitors. To lead, you must understand the mission of your company and take the steps which, in time, will be studied by other, less successful companies seeking to emulate your success.

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Editor: John Walker