Wednesday, April 13, 2011

No, Cisco Didn't Flip Out; A good, Fast Lesson for Start Ups

When I first read about Cisco's decision to shut down its Flip division, I was stunned. This technology/product seemed like a no brainer. Even though the capability is quickly being built into multi-purpose, networked devices, surely Flip cameras would be needed or could be repurposed.

I don't know if there is a case to be made for that argument, but Cisco has just taught start ups a really important lesson:

if you have piece of your business that doesn't focus on your core capabilities, don't let it sink slowly. Kill it quickly.

It's hard for any company to do that, but it's really hard for a big business to do it. Because they often have the resources to support the ship in hopes of finding a solution. But with start ups, where every penny matters, that option is not available. Make these decisions quickly.

Of course, this depends on understanding clearly what your core essence is. Because you don't want to kill businesses that are key to that essence. That's what makes the fast decision so hard.

But Cisco's lesson is really important; they know their essence and saw that the Flip wasn't part of it.

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