Alan Wurtzel, who helped turn Circuit City into a great company, wanted to understand why it collapsed.
As the son of its founder, he says family businesses have both benefits and challenges: the benefits of loyalty and common purpose, the challenges of decision-making complicated by family dynamics.
Still, Circuit City became a public company and failed as a public company.
His assessment of its mistakes:
- failure to act on clues in the market,
- unwillingness to challenge assumptions, and
- reluctance to rock the boat.
√ Mind your business and let the stock price take care of itself.
√ Recognize that the market always changes and success won’t last.
√ Question your assumptions. “When you think you know the answers, you stop challenging your own strategy, and that’s when you get into trouble.”