Why Winning Streaks End

by Rosabeth Moss Kanter | 11:08 AM February 8, 2010

That crashing sound you hear is not an accident caused by sudden acceleration of your hybrid car; it is the continuing toppling of idols, such as hybrid car companies, off their pedestals. Listen hard, lest you be next.

Toyota, the world's leading auto company, faces a series of product problems causing a $2 billion recall , an investigation by the National Highway Traffic Safety Administration, and a galling loss of face for a company from face-conscious Japan. This follows its first annual financial loss in 50 years, with profitability regained partly through cost-cutting.

Sayonara for a while to Toyota's reputation for quality control and invincibility. But in Dearborn, Michigan, there are no smug smiles. Ford announced that it is also fixing electronic brakes in its hybrid cars after a damaging review by Consumer Reports and more generalized concerns about electronics in cars.

The noise continues. In banking, the latest jackhammer blow to any remaining pedestal pieces is acivil fraud lawsuit against former Bank of America CEO Kenneth Lewis. Okay, bankers might not be saints, but the saintly are crashing, too. Ten U.S. missionaries were arrested in Haiti on charges of abducting children, apparently admitting that they had neglected to secure all the necessary permissions, and with hints that some of the "orphans" had living parents. Do some people who feel they are doing good think that they can bend a few inconvenient rules to do it?

And if these weren't enough reminders about fallen idols for one week, the Super Bowl did not feature my favorite team, the New England Patriots, whose period of NFL dominance snapped this fall among hints of eroding focus and discipline.

All too often, long periods of continued success are undermined not by the competition but by self-inflicted wounds. I uncovered common patterns in business, sports, leadership, and life in research for my book Confidence: How Winning Streaks & Losing Streaks Begin & End .

Winners become sinners when confidence turns into complacency and arrogance. They over-estimate their own invincibility and under-value mundane disciplines. Whenever someone feels on top over a long period of time, they are tempted to neglect the very fundamentals that helped them succeed in the first place. They might even start to feel that the rules don't apply to them.

Success means that people or teams or organizations survive long enough to need maintenance, repairs, and reinvestment. Winners undergo natural aging processes, as people get older, slow down, leave. Facilities, tools, and bags of tricks get older, deteriorate, and run down. Newcomers might get less rigorous training while long-timers forget what they learned. As momentum runs down, people and buildings begin to look run down. Neglect takes on tangible physical manifestations, such as out-of-shape bodies or broken windows. Add to this the pressures in a recession to cut costs and defer expenditures.

Erosion begins by removing a process or discipline. Let's defer those roof repairs for another year... Let's cut out one practice; we already have so many... Let's save time by eliminating the weekly team meeting... The Chernobyl nuclear plant disaster was said to be caused by engineers neglecting small portions of routine safety checks because they had done so before, and nothing had happened. Oops.

Whether you head a company, lead a good cause, or coach your children's soccer teams, your job is to root out complacency. Remember to:

Keep up the essential disciplines every single day, not skipping a single one.
Keep checking everything carefully.
Repair, renew, relearn, and reinvest regularly.
Don't rejoice in others' misery, because you could be next.
Thank anyone who points out flaws. Listen to disgruntled customers or disaffected constituencies.
Treat even small setbacks as occasions for redoubled efforts.

"Winning is great, but sometimes it takes a loss to get you motivated again. It humbles you down to reality," said a high school athlete in my research. That youth speaks truth! Although he might not be old enough to drive a Toyota, he is headed in the right direction.

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