The Story of Aberdeen City Will Make you Understand why Companies Fail
Even when a city has every conceivable advantage — wealth, world leading expertise, good education — why can it not remain abreast of developments or develop alternative industries?
Aberdeen, Scotland, is the Oil and Gas capital of Europe.
But a world-leading example of how complacency and lack of foresight can prevent a city from having any meaningful impact on the future.
The city is awash with capital if you just spent five minutes walking down the streets and you would be mesmerised by the opulence that drives past you.
Less obvious would be the lack of revolutionary products or services that have arisen from a place with such a high collection of world-class expertise, talent and wealth.
The Backstory
In many ways, Aberdeen is the Anti-Silicone Valley of the world. The culture of working together in order to drive product innovation and expertise is nowhere to be found, much to the cities detriment. The insular nature of the billion dollar enterprises operating in the region is the defining characteristic married to a staunch Scottish frugality.
Where elsewhere the economically successful nourish the businesses of tomorrow, here they are more likely to ride off into the sunset.
I surmise there are few places in the World that approach Aberdeen for volume of Millionaires by head of local population.
I would also assume there are few places with such a concentration of Wealth with such a lack of investment in new businesses or infrastructure necessary for the success of the city.
What was the last revolutionary product or service, Oil and Gas related or otherwise, to be created in Aberdeen? I struggle to find any. There is, of course, the tremendous success story of Brewdog locally, but even the local council are doing their best to throw a spanner in those works.
Out with that, what else has been achieved?
Aberdeen had an unprecedented opportunity to exploit its fortune and future proof a city. The historical evidence of what happens when industry dies is all around us, look at the Clyde shipbuilding etc.
The city should have taken advantage of the opportunity and created world-class infrastructure. Why can’t 747 freighters arrive and depart from ABZ with our purported world leading products? Complacency and lack of foresight.
The wealth should have lead to investment. It should have produced new world leading products and birthed thriving technology sectors. I look at Edinburgh’s tech hub with great envy. Why didn’t we have the ambition to create?
Aberdeen will go down as a city that failed to appreciate the opportunity it was afforded. For a small fishing village to evolve and thrive as the heart of Europes Oil industry was incredibly fortuitous.
To fail to plan and account for what will happen when it’s gone is idiocy born from arrogance. The local government has never helped.
Lessons to Learn
Above is the prevailing story of human nature.
Companies fail to appreciate the potential for change or invest during periods of prosperity. Instead of embracing proactiveness they are reactionary which prevents the agility required to tackle emerging and unforeseen problems.
Instead of anticipating existential threats, they cut R&D spending in order to economise processes and pad profits. They see the current shareholders as more important than the companies future.
Development makes way for dividends, eroding the innovation of the business
Today’s product should never be tomorrow’s promise.
“How did you go bankrupt?” Bill asked.
“Two ways,” Mike said. “Gradually and then suddenly.”
Ernest Hemingway’s 1926 novel, The Sun Also Rises.
Businesses like cities die twice. You see the gradual decline over time, then almost overnight everything ceases to exist. Once the rot has set in it’s almost impossible to eradicate. It erodes to company from the inside with the lack of innovation starving the flames that heat the steam to power progress.
The Answer
Unfortunately, there are no silver bullets.
The lack of innovation is almost always terminal. If it is championed by those most important to the progress death is the sentence. If the most influential can’t or won’t change there are no means of escape.
But all it takes is one to nourish the flame.
That could be a solo investor or an individual visionary. All it takes is someone brave enough to dream of more, of better. To fund ideas through action, spirit or finances.
All it takes is the realisation that everything created or neglected was done so by people just like you.
If you want change you need to embody it.
The world you live in was created by people no smarter than us.
