Once is luck, twice is skill

Once is luck, twice is skill.  

“Our costs are too high, and margins are too small,” wrote Intel Corporation CEO Pat Gelsinger in a letter to employees. The stock of this iconic company has dropped by over 50% since the beginning of the year. With great surprise, the market and analysts are watching this situation and asking: what happened?  

In 1996, Andrew Grove, former Intel CEO, published one of the most important business books, "Only the Paranoid Survive". I think it needs no recommendation. In the book, Grove describes moments when an organization or industry faces major changes—so-called "inflection points." These moments can be triggered by new technologies, market shifts, or competition. Companies must adapt quickly to survive. And for over three decades, Intel was a model of implementing this strategy. It can be said with confidence that adaptation and innovation were redefined in this book. Companies must be flexible and ready to innovate. Grove tells the story of how Intel transformed from a semiconductor memory manufacturer into a company focused on processors when competitors began to dominate their original segment. They were able to recognize the moment when “to be” meant “to change.” But this time, something went wrong.   Grove says that leaders and the entire company must have the ability to detect change. In his book, Grove emphasizes that organizations need to be able to spot changes on the horizon before they become obvious. This is a key skill for surviving in a changing market, and leaders must make difficult, often risky decisions to steer the company through transitions.  

Looking at the entire technology market, and even beyond, a recurring pattern can be observed. COVID-19, which brought incredible revenue growth, lulled leaders into complacency. Sectors are waking up from this lethargy, announcing that it's time to apply proven methods again. Reorganizations aimed at cutting costs are now commonplace. Companies that implemented cloud technologies are starting optimization processes. Remote work is being reduced, and large investments are slowing down. We are refocusing on the customer and trying to understand their real needs.

Companies are moving away from automated customer service, and bank branches are being refurbished to welcome customers again.   It is said that if someone succeeds once, it means they were lucky. When success repeats multiple times, it means they have skill. Many companies today need a critical look at their operational and business model. Many need the spirit of "paranoia" to stay relevant in the market. This is the best time for revolutionary changes and real shake-ups in industries. It has been exactly a decade since social media platforms took over revenue streams from telecoms. Fintechs took the place of slow-moving banks. Now, banks, with their vast investment resources, will revolutionize the utilities, real estate or FMCG sectors. Get ready for change because it's going to happen right before our eyes.