How Circuit City blew its fuse

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in Best-Practices Leadership,Leaders & Managers

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:

  1. failure to act on clues in the market,
  2. unwillingness to challenge assumptions, and
  3. re­­luctance to rock the boat.

His advice:

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.”

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