Republican Buggywhip Makers

Amazon says Kindle owners buy 3.1 times as many books as they did before getting one.
- New York Times 10/25/2009

E-readers are catching on. Sony has had their version out for nearly a year. Barnes and Noble will issue their version of the Kindle in November. You can now download a Kindle book in over 100 countries. Universities are giving the Kindle 3 to incoming students.

Jeff Bezos was quoted in the same article saying “You are going to see very significant growth rates.” The CEO of McMillan publisher, John Sargent, was also quoted saying “Do you really believe people are going to be reading more because they can get it on a screen? I don’t see that scenario.”

Mr. Sargent is right. People aren’t going to be reading more because they can get it on a screen. But they will be buying more because they can get a book for $20 less, and have it fit in their coat pocket or briefcase. Try doing that with Dan Brown’s latest.

Mr. Sargent joins a long line of people who live in self deception, locked into their old ideas, unable to see the world changing around them. He is like auto executives who insisted that the public won’t go for small, safe, fuel efficient cars, and built F-150’s and mini-vans long after to the success of the Prius. Like the music industry that missed the boat on downloadable music, publishing and newspapers have missed the fact the rules of their business are changing. His industry is now in danger of following the path of so many other industries in the past that stagnated and died.

Why do companies stagnate?

Aimattech is a strategic planning and management consulting firm. They identified four reasons why companies stagnate. (http://www.aimattech.com/news1.htm#why). The first is the company has no vision, strategy or strategic business plans. The second is a weak or ineffective management, third is lack of information and control systems, and fourth is under capitalization.

Sounds like the Republicans doesn’t it?

As a Party they have no vision. They made a strategic decision to oppose everything that the Democrats propose. There are many pitfalls to this strategy. People will not follow a group that doesn’t appear to be going anywhere. It is not enough to say “No.” You have to say what you plan on doing instead. People will only follow leaders who relate to them and try and solve their problems.

Now the reason the Republicans have plunked their chips down on this strategy is not through any grand scheme. The real reason is summed up in point number two. The Republican Party has no real leadership. Mitch McConnell is the Senate Minority Leader and has never been a national figure. John Boehner is trapped in a personality that makes him come across as a disapproving school principal.

Neither leader is strong enough to buck the red-meat conservatives who give the party money, volunteers and a base and broaden its reach. This leaves the Republican Party under the guidance of radio and TV talk show hosts, who are in the business of entertainment, not electing people.

The problems created by this weak management are only heightened by the lack of information and control systems. The Republicans came to and held on to power by seeing trends that others missed. Whether it was the “Southern Strategy” of Nixon which lead to the “Reagan Democrats”, Republicans were masters at identifying social trends that worked for them.

Not anymore.

The Republicans have convinced themselves of the myth of Obama’s waning popularity. They honestly believe that Obama’s drop in the polls spells trouble for Democrats and bright days ahead for the GOP. However, even the most casual glance at the polling data show this to be false. Obama’s approval rating in October of 2009 is almost identical to his approval rating in November of 2008 – an approval rating that gave him a solid election victory. (http://www.pollster.com/polls/us/jobapproval-obama.php).

In addition, after a brief flirtation with Republicans, Independent voters are once again moving Obama’s way. Finally, the Republicans are blind to the demographic changes that are working against them. These changes, if not addressed, will solidify the Republican demographic as less educated white southern men over 60, in a time that the voting population is getting younger and more diverse.
Even if the Republicans wanted to address these issues they don’t have the internal discipline or control to manufacture and sell their message.

Finally they are undercapitalized. The Democratic National Congressional Committee has over twice the cash on hand for the 2010 election cycle as their Republican counterparts. People vote with their wallet. If party does not have a compelling idea or a broad reach, people won’t contribute. Money has always been a leading indicator if a candidate is going to succeed or fail – no matter what their poll numbers say.

Currently the Republicans show all four of these signs of stagnation and failure. As the party of into business they should recognize these trends. Maybe they will be like IBM or Apple and reinvent themselves and be successful again. Or maybe, just maybe, they will be Kodak and will continue to manufacture film long after everyone else has gone digital.