List of the sixteen mistakes entrepreneurs do not have to make from John Osher

John Osher is a very successful entrepreneur in America. He found numbers of new ventures in different industries: earrings, antique fashion, energy conservation products, baby products, toys and toothbrushes. Millions of dollar is earned from these companies. He shares a list of 16 mistakes which entrepreneurs should not make from his experience in a Harvard Business School case study.  

Creative Destruction

The first Standard and Poor’s (S&P) index was created in 1920 in USA. 90 major companies were on the original list for a span of 65 years. In 1998, the S&P list was expanded to 500 companies and their average life spans were around 10 years. In 2000s, some studies suggested that the average life span of top companieswould be shortened to 5 years. This shocking trend is mostly caused by the effect of intensified creative destruction.

In a journal article titled Creative Destruction, it  describes interactions between companies and markets in the creative destruction process and implications for management to take advantage of the process. This summary is shown in a mind map at the end of this post.  

Creative destruction theory  explains how the economy evolves in a capitalist environment. This particular theory focuses on innovation aspects of economic development. The key concept of creative destruction is that innovative breakthrough can only be achieved by destroying some of the current economic system and status quo. This simply means that innovation can only created by changing the rules of game. As this happens in a rapid pace in the past 20 years, many companies which cannot catch up and adopt with the new rules, they have to leave the game.  Nowadays, if companies do not have the  ability to embrace creative destruction in their strategies and operations, they will  not survive very long in the game.