A lot of world changing companies out there started without a business plan, much less a sale. It was about trying to see what could be done with X. Sales people don't get this. Tech is not only about making a quick buck, but about creating new things altogether.
There's an interesting anti-pattern I see in business time and time again...it's the company that's run as follows:
1) Start with a successful product (regardless of how it happened to become successful) and put a top-tier MBA guy in charge
2) Slowly fire or alienate all of the engineers who had anything to do with the initially successful product (too expensive!), replace them with more sales guys and/or very cheap and incompetent "maintenance engineers" so abstract engineering vs. cost numbers can show diligent stewardship of the product
2b) Stop innovating entirely
3) Squeeze the product for cash like a vampire trying to squeeze blood from a stone
4) Eventually the product momentum runs out and the sales stop coming in
Making a new product is both hard, and expensive, it's understandable that MBA types want to try and recoup that and make a multiplier on that initial investment. They're allergic to putting huge investments back in for a round 2 of innovation.
It sometimes works (see Oracle), but usually ends up with a failed company being sold off for parts.
Chrysler is a fantastic example, the First Generation 300 (2004) started out as a very popular car, selling over 110,000 copies in it's first year. A bad merger with Daimler-Benz later, Chrysler ended up in MBA-tastic Cerberus's hands in 2007. So what did they do with their almost 4 year old flagship that was selling over 120,000 copies a year? They let it sit for 2 more years. Nothing, no new models, no minor redesigns, no real updates. In 2008 sales were half, then in 2009 almost half again. It wasn't until 2011 that a new model finally came out, and it was a shockingly modest refresh after nearly 8 years and what happened? Sales almost doubled in 2012!
My point is that it's not that hard, a new front end, some cosmetic interior changes and a fancier CD player and if doubled product sales. Why didn't they do that at any time in the preceding few years? They were simply working too hard trying to squeeze blood from stone.
At the risk of being influenced by survivorship bias, Apple under Jobs is the counter argument to this. It's an example of what happens when you ruthlessly pour resources into keeping products fresh. But somehow this lesson seems to escape so many product companies (tech or other industry).
Perhaps a better non-tech example is Coca-cola. Sure it's more or less the same product, but Coke spends extraordinary amounts of money keeping their brand fresh, slight changes in bottle shape, even slighter changes to the logo and packaging, effectively putting a new front-end on their product. It's one of the most valuable brands in the world.
Your analysis reminded me of an article I read a few years ago called "Driven off the Road by MBAs"[1].
I won't give a synopsis because it is a really short article - but here (IMO) is the key sentence and take away: "...ultimately, moving numbers around can do only so much. Over the long haul, you've got to invent or improve real products and services to grow."
The author of the article references a book written by Bob Lutz called "Car Guys vs. Bean Counters: The Battle for the Soul of American Business"[2], which contains numerous examples of how replacing executives from engineering backgrounds with executives from more traditional business backgrounds failed GM as a strategy.
I reason the style of thinking you describe comes from the 70s/80s when mergers and acquisitions started to take place more and more. It became worse in the 80s (the decade that gave birth to the predator's ball (look it up)). Corporate types don't see products. Neither do they see people. They see quarterly results. Product development takes a back seat, because that costs money. So, they just milk it while it lasts and then blame the next CEO.
But you don't need to run a business like that. Sure, you can be a blood-thirsty profits vampire. Yet still make investments into product development that will allow you to have more blood to suck in the future. I'd say its a balance between profit/innovation, which Jobs became good at.
There's an interesting anti-pattern I see in business time and time again...it's the company that's run as follows:
1) Start with a successful product (regardless of how it happened to become successful) and put a top-tier MBA guy in charge
2) Slowly fire or alienate all of the engineers who had anything to do with the initially successful product (too expensive!), replace them with more sales guys and/or very cheap and incompetent "maintenance engineers" so abstract engineering vs. cost numbers can show diligent stewardship of the product
2b) Stop innovating entirely
3) Squeeze the product for cash like a vampire trying to squeeze blood from a stone
4) Eventually the product momentum runs out and the sales stop coming in
Making a new product is both hard, and expensive, it's understandable that MBA types want to try and recoup that and make a multiplier on that initial investment. They're allergic to putting huge investments back in for a round 2 of innovation.
It sometimes works (see Oracle), but usually ends up with a failed company being sold off for parts.
Chrysler is a fantastic example, the First Generation 300 (2004) started out as a very popular car, selling over 110,000 copies in it's first year. A bad merger with Daimler-Benz later, Chrysler ended up in MBA-tastic Cerberus's hands in 2007. So what did they do with their almost 4 year old flagship that was selling over 120,000 copies a year? They let it sit for 2 more years. Nothing, no new models, no minor redesigns, no real updates. In 2008 sales were half, then in 2009 almost half again. It wasn't until 2011 that a new model finally came out, and it was a shockingly modest refresh after nearly 8 years and what happened? Sales almost doubled in 2012!
My point is that it's not that hard, a new front end, some cosmetic interior changes and a fancier CD player and if doubled product sales. Why didn't they do that at any time in the preceding few years? They were simply working too hard trying to squeeze blood from stone.
At the risk of being influenced by survivorship bias, Apple under Jobs is the counter argument to this. It's an example of what happens when you ruthlessly pour resources into keeping products fresh. But somehow this lesson seems to escape so many product companies (tech or other industry).
Perhaps a better non-tech example is Coca-cola. Sure it's more or less the same product, but Coke spends extraordinary amounts of money keeping their brand fresh, slight changes in bottle shape, even slighter changes to the logo and packaging, effectively putting a new front-end on their product. It's one of the most valuable brands in the world.