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Creative destruction and corporate becoming

February 13, 2017

Excerpt from an OUPblog article, published on 11th February 2017, written by Robert A. Burgelman, author of Becoming Hewlett Packard: Why Strategic Leadership Matters, which is now available on Oxford Scholarship Online.

Becoming Hewlett Packard: Why Strategic Leadership Matters

"While today’s business media (and business schools) are much enamored with Silicon Valley-style start-up entrepreneurship, only those startups able to grow into large, complex enterprises (e.g., Google, Facebook, Linkedin, Netflix) materially impact the evolution of the global industrial system. The average lifespan of such large, complex enterprises, however, is on the decline. Research has revealed that the average lifespan of a company in the S&P 500 index (a stock market index that tracks the 500 most widely held stocks on the New York Stock Exchange), for instance, has decreased from 61 years in 1958 to 18 years by 2015, and appears to continue to decline. Similarly, Andy Grove and I have reported that of the largest 100 companies in the US in 1965, only 19 remained on that list in 2005. In other words, the gale of creative destruction, and the more recently identified force of “disruptive technology” did not spare many of the largest US-based corporations that existed in 1965..."

Read the rest of the article on the OUPblog >


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