Escape From the Inertia of Success

What we can learn from Deng Xiaoping, Andy Grove and ancient Chinese scholars.

Sean Maloney, chairman of Intel China, recently shared his perspective on leadership in an article he penned for Global Entrepreneur Magazine, a prominent business publication in China. Intel Free Press presents the following English translation of Sean’s story.

 
“Not fooled by success, or stopped by failure.” What we can learn from Deng Xiaoping, Andy Grove and the ancient Chinese scholars.

China’s market has undergone explosive growth in the past decade. China is already No. 1 in many industries: steel production, auto manufacturing, PCs, smartphones — the list goes on. But this is only the start. In 5 years’ time, China’s PC market is forecast to be twice the size of the U.S. market.

Sean Maloney, chairman of Intel China

Sean Maloney, chairman of Intel China

China is progressing through this lightning transformation in part thanks to the entrepreneurial spirit of its people. Small-business owners are everywhere, and it is many people’s dream to be their own laoban.

Being able to make a fast buck is only half the story. Whether during boom or recession, leadership will always be a lesson that Chinese managers need to make up for. Leadership means bearing responsibility for failure as well as success, and demonstrating a commitment to customers, whoever they are.

The Inertia of Success

Great business leaders look to the long term in setting increasingly challenging objectives, rather than cutting corners to make a bit more money today. They never rest on their laurels.

Early in my career I had the opportunity to work for someone I believe is one of the best business leaders of the past century: Andy Grove, who was then Intel’s chairman and CEO. Andy firmly believes that senior managers who have risen through the corporate ranks risk suffering from what he describes as “the inertia of success,” when people cling to the familiar old way of doing things. This is especially dangerous at critical points in a company’s development, when decisive action could result in greater successes, but passive denial will definitely result in decline. To this end, he relished the anarchy of creativity and encouraged experimentation even when business seemed to be going well.

This philosophy can be summed up in the title of one of Andy’s most popular books, “Only the Paranoid Survive.” In it, he gives the example of Intel, which clung to its money-losing memory chip business for quite some time, before the rest of the business also went into a recession and forced the company to make a strategic shift. Andy used this to illustrate how a business’ success brought its own destruction and that only by constantly improving can you stay ahead of the game.

Do the Right Thing at the Right Time

Being a business leader rather than just an entrepreneur means being able to understand what’s coming up, not just what’s happening now. And it requires good timing.

I had the opportunity to move to Hong Kong 20 years ago to expand our presence in this part of the world. I immersed myself in Asia, learned a lot about China and came to appreciate the leadership of former Chinese leader Deng Xiaoping, whose vision and timing control have always been commendable.

When he visited the U.S. in 1979, the world didn’t know much about China. Deng knew that it was the right time to make this move, and with gestures such as donning the iconic “10-gallon hat,” Deng sent a message that China was ready and willing to embrace modernization. In fact, his reform policies were very forward-thinking for their time in China. He insisted that, because the vast majority of the population in the early ’80′s lived in rural areas, reform should begin there. But he also appreciated that economic development needed to expand beyond the countryside. The special economic zones that have been at the forefront of China’s growth were started under his leadership.

Even at the age of 88, when his vision for an economically strong China was under threat, he embarked on his 1992 “southern tour” to accelerate China’s reform and opening up. Deng is an example of how to do the right thing at the right time, sowing the seeds of China’s current success.

Ignore Successes and Endure Hardship

All great leaders overcome adversity – in many cases it defines them. Grove, for example, had very little going for him when he arrived in the U.S. at the age of 20, rose from nothing to the head of the one of the world’s biggest companies. And yet he never let success go to his head; at Intel, he always worked in a cubicle, just like everyone else.

Deng has a similar story. He bides his time, overcomes setbacks and drives forward to achieve his ambitions. It is well known that he entered government three times, and was twice removed from his leadership positions. He had to spend years waiting for the opportunity to return, uncertain of the future but sure of his own capabilities. This strength of character helped Deng negotiate the peaks and valleys of life.

In China, increasing numbers of people are able to fulfill their entrepreneurial aspirations, but for them to become tomorrow’s business leaders they will need to overcome the complacency bred by short-term success. They need vision, they need to inspire continuous innovation and they need the determination to make it happen despite any obstacles.

 
Related stories

Escape From the Inertia of Success

What we can learn from Deng Xiaoping, Andy Grove and ancient Chinese scholars.

Sean Maloney, chairman of Intel China, recently shared his perspective on leadership in an article he penned for Global Entrepreneur Magazine, a prominent business publication in China. Intel Free Press presents the following English translation of Sean’s story.

 
“Not fooled by success, or stopped by failure.” What we can learn from Deng Xiaoping, Andy Grove and the ancient Chinese scholars.

China’s market has undergone explosive growth in the past decade. China is already No. 1 in many industries: steel production, auto manufacturing, PCs, smartphones — the list goes on. But this is only the start. In 5 years’ time, China’s PC market is forecast to be twice the size of the U.S. market.

Sean Maloney, chairman of Intel China

Sean Maloney, chairman of Intel China

China is progressing through this lightning transformation in part thanks to the entrepreneurial spirit of its people. Small-business owners are everywhere, and it is many people’s dream to be their own laoban.

Being able to make a fast buck is only half the story. Whether during boom or recession, leadership will always be a lesson that Chinese managers need to make up for. Leadership means bearing responsibility for failure as well as success, and demonstrating a commitment to customers, whoever they are.

The Inertia of Success

Great business leaders look to the long term in setting increasingly challenging objectives, rather than cutting corners to make a bit more money today. They never rest on their laurels.

Early in my career I had the opportunity to work for someone I believe is one of the best business leaders of the past century: Andy Grove, who was then Intel’s chairman and CEO. Andy firmly believes that senior managers who have risen through the corporate ranks risk suffering from what he describes as “the inertia of success,” when people cling to the familiar old way of doing things. This is especially dangerous at critical points in a company’s development, when decisive action could result in greater successes, but passive denial will definitely result in decline. To this end, he relished the anarchy of creativity and encouraged experimentation even when business seemed to be going well.

This philosophy can be summed up in the title of one of Andy’s most popular books, “Only the Paranoid Survive.” In it, he gives the example of Intel, which clung to its money-losing memory chip business for quite some time, before the rest of the business also went into a recession and forced the company to make a strategic shift. Andy used this to illustrate how a business’ success brought its own destruction and that only by constantly improving can you stay ahead of the game.

Do the Right Thing at the Right Time

Being a business leader rather than just an entrepreneur means being able to understand what’s coming up, not just what’s happening now. And it requires good timing.

I had the opportunity to move to Hong Kong 20 years ago to expand our presence in this part of the world. I immersed myself in Asia, learned a lot about China and came to appreciate the leadership of former Chinese leader Deng Xiaoping, whose vision and timing control have always been commendable.

When he visited the U.S. in 1979, the world didn’t know much about China. Deng knew that it was the right time to make this move, and with gestures such as donning the iconic “10-gallon hat,” Deng sent a message that China was ready and willing to embrace modernization. In fact, his reform policies were very forward-thinking for their time in China. He insisted that, because the vast majority of the population in the early ’80′s lived in rural areas, reform should begin there. But he also appreciated that economic development needed to expand beyond the countryside. The special economic zones that have been at the forefront of China’s growth were started under his leadership.

Even at the age of 88, when his vision for an economically strong China was under threat, he embarked on his 1992 “southern tour” to accelerate China’s reform and opening up. Deng is an example of how to do the right thing at the right time, sowing the seeds of China’s current success.

Ignore Successes and Endure Hardship

All great leaders overcome adversity – in many cases it defines them. Grove, for example, had very little going for him when he arrived in the U.S. at the age of 20, rose from nothing to the head of the one of the world’s biggest companies. And yet he never let success go to his head; at Intel, he always worked in a cubicle, just like everyone else.

Deng has a similar story. He bides his time, overcomes setbacks and drives forward to achieve his ambitions. It is well known that he entered government three times, and was twice removed from his leadership positions. He had to spend years waiting for the opportunity to return, uncertain of the future but sure of his own capabilities. This strength of character helped Deng negotiate the peaks and valleys of life.

In China, increasing numbers of people are able to fulfill their entrepreneurial aspirations, but for them to become tomorrow’s business leaders they will need to overcome the complacency bred by short-term success. They need vision, they need to inspire continuous innovation and they need the determination to make it happen despite any obstacles.

 
Related stories