Page 108 - MS Year in Review 2020

Accordingly, the bankruptcy of Osborne Computer illustrates the dire consequences

of the Icarus Syndrome.

KEY LESSONS FROM THE ICARUS SYNDROME

EXPERIENCE OF OSBORNE COMPUTER

What can we learn from the failure of Osborne Computer to successfully manage its

own rapid growth?

Organizational Infrastructure” Is A Necessity for Long-Term Survival. The
first lesson is that “organizational infrastructure” (day-to-day operational systems,
management capabilities, and management systems) is a necessity for long-term

survival of a business enterprise. It is not just something that might be nice to
do. And, the infrastructure of a company needs to be aligned with its size. Stated in
another way, as a company grows, its internal systems, processes, and capabilities

need to change to support it. A $1 million enterprise is significantly different from a
$10 million business; and a $10 million business is significantly different from a

$100 million business.

The Rate of Growth Experienced by A Company Impacts Need for

Infrastructure. The second lesson is that the more rapid the rate of growth
experienced by a company, the more rapid the need for organizational
infrastructure development. In addition, the more rapid the rate of growth of a

business, the less time there is to identify and manage the crisis brought about by
this growth. There is less clock-time in terms of months or years to accomplish the

development of required organizational infrastructure in rapid growth businesses
such as Osborne Computer. On the surface, hyper-growth in revenues seems to be
very attractive. However, it also represents a serious danger. If the company

cannot move quickly enough to create the management capabilities and
management systems (“organizational infrastructure”) requited to support its
operations, it will be at risk for failure just as Osborne Computer.

107
© Management Systems Consulting Corporation, 2020. All rights reserved