When Does It Stop Even Being IT: Buyers vs Doers
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@flaxking to follow on that, I had a discussion with investors just last week where we talked about why it would be better to build competing businesses right across the street from existing companies, than to buy those companies, because it's more cost effective to put them out of business by doing a good job than to buy them and take on all of their bad decisions in the past!
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@Mario-Jakovina said in When Does It Stop Even Being IT: Buyers vs Doers:
It seems you think you saw a lot of examples of CIOs not adding value.
This should not be "seems". I'm telling you, this is the norm by a huge margin.
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@Mario-Jakovina said in When Does It Stop Even Being IT: Buyers vs Doers:
But then that means they have uncompetent CEOs who have uncompetent business owners...
Right, which should go without saying. Remember the average SMB fails, completely. Most that survive barely do. The market is full of total incompetence.
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@Mario-Jakovina said in When Does It Stop Even Being IT: Buyers vs Doers:
I find it hard to believe that it is common in SMBs. How do they survive in competitive markets?
They don't. First, because almost none that you see have competition of any sort. And even so, the vast majority of SMBs fail. Of those very, very few that survive, most only become orbital. The insanely rare successful SMB almost always stop being SMBs very quickly.
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@Mario-Jakovina said in When Does It Stop Even Being IT: Buyers vs Doers:
I understand that "IT Buyer" for you definitely means "Uncompetent IT Buyer"
Absolutely not. It means nothing of the sort. Where did you get that impression?
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Yes, I'm saying that the majority of CEOs and CIOs are really, really bad at what they do. And every bit of market info we has 100% supports that.
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@scottalanmiller said in When Does It Stop Even Being IT: Buyers vs Doers:
@Mario-Jakovina said in When Does It Stop Even Being IT: Buyers vs Doers:
I understand that "IT Buyer" for you definitely means "Uncompetent IT Buyer"
Absolutely not. It means nothing of the sort. Where did you get that impression?
In your 1st video - you try to explain and then u say "purely buyers".
Now, in your last video, you also argue that "average is bad, very bad"... so you confirm that you speak of uncompetenet ones, mostly.
But OK.... -
@scottalanmiller said in When Does It Stop Even Being IT: Buyers vs Doers:
Yes, I'm saying that the majority of CEOs and CIOs are really, really bad at what they do. And every bit of market info we has 100% supports that.
I agree with what you explain in this video (most startups fails, average is bad in most fields, Mangolassi is creme...)
I worked for 12 years as SMB banker, get to know many of SMBs deeply...But I didn't thought that failing startups, with few employees, have relevance for your points. I don'f find common that small startups have 150.000$ IT bugets, or CIOs that actually do nothing. I think that happens at larger SMBs.
I think you should exclude companies that fail in few years from your arguments, because they distort statistics. They make large percent in number of companies, but small percent of employees, market share....
Again, I agree with what you say in this video
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@flaxking said in When Does It Stop Even Being IT: Buyers vs Doers:
Based on my experience, I would guess that most profitable SMBs aren't operating in a competitive market. And if that market becomes competitive, they do not survive.
Here is how I see it:
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Most SMBs fail in first years - that is natural...
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They fail becuse they are in competitive market - If they don't have competition, they could easiliy raise their prices and survive, no matter how bad they are at business
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It is also natural that most survivors are not very profitable - If many are very profitable then new players enter market...
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After all above, it is normal that most very profitable SMBs (that do not grow fast and stop be SMBs) are in market niches where it is hard for newcomers to enter (low competitive niches).
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Generally competition drives extra profits to zero. That's why large succesfull company try to make their market less competitive (branding, patenting bullshits
My point is - I don't see many companies in non-competitive environment
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@Mario-Jakovina said in When Does It Stop Even Being IT: Buyers vs Doers:
@scottalanmiller said in When Does It Stop Even Being IT: Buyers vs Doers:
@Mario-Jakovina said in When Does It Stop Even Being IT: Buyers vs Doers:
I understand that "IT Buyer" for you definitely means "Uncompetent IT Buyer"
Absolutely not. It means nothing of the sort. Where did you get that impression?
In your 1st video - you try to explain and then u say "purely buyers".
Now, in your last video, you also argue that "average is bad, very bad"... so you confirm that you speak of uncompetenet ones, mostly.
But OK....In all cases, but the doers are bad on average too. So it's not connection to being buyers.
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@Mario-Jakovina said in When Does It Stop Even Being IT: Buyers vs Doers:
But I didn't thought that failing startups, with few employees, have relevance for your points. I don'f find common that small startups have 150.000$ IT bugets, or CIOs that actually do nothing. I think that happens at larger SMBs.
Startups often have bigger budgets because they know that they have to spend and lose up front, whereas an operational company will often try to live within its revenue limits.
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@Mario-Jakovina said in When Does It Stop Even Being IT: Buyers vs Doers:
I think you should exclude companies that fail in few years from your arguments, because they distort statistics. They make large percent in number of companies, but small percent of employees, market share....
Maybe, but they are the majority of what IT deals with. If you exclude them, it also distorts the stats by eliminating the majority of bad business people - but our careers don't eliminate them. In the real world we deal with failing or orbital businesses constantly, it's not like they fail silently in the background and IT doesn't have to deal with it.
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@Mario-Jakovina said in When Does It Stop Even Being IT: Buyers vs Doers:
My point is - I don't see many companies in non-competitive environment
I see absolutely tons. Mostly because the market is small. I'll give an example...
Crappy restaurant opens in a town of 1,000 residents. It's not horrible, just not very good. Prices are a little high, service slow, a few food items are good, most are blah. They survive because people want a place to eat and they are it.
No competition. Logically a competing restaurant will just open up and kill them off, right? Well, no. Because the market doesn't grow with the new restaurant. So someone looking to open a new restaurant says "even if I make a better restaurant I have to compete against an established restaurant with less debt... the potential market for the second restaurant is smaller even if they do better."
The second restaurant has a lot of fears... can they really do better than the first one? If they cost less, they have fewer profits to use to compete. If they make better food or have better service, that only causes a certain percentage of people to switch to them. Most people will split their time to some degree between the two, lowering the market share for both. Presumably the established company has less debt and is already up and running and can improve their food, service, and prices before the new restaurant opens - potentially making it impossible to compete, then they can go back once the new one fails. Did the first restaurant get the best choice of real estate and the new one just the second best location?
It's actually extremely common in the SMB world for companies to remain without competition because it's often not a market where there is much to any value to competing where someone is already there. Established companies have typically deep pockets to throw at making new start ups in their space fail.
