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Rock Star Revival
March 19, 2008
By Hap Cooper
Most training companies are founded by "rock stars"—very talented and charismatic individuals who constitute both the sales force and the product. Their companies are immediately successful and grow with minimal effort. Life is good.
By most accounts, a rock star can sell and deliver $1 million a year with little or no help. Most rock stars, however, quickly recognize they can do much more business with an entourage, so they hire people to assist with finances, administration, marketing, fulfillment, etc. They now can focus most of their time on what they do best—selling and being the product. They add members to the band. Now the company is poised to grow to the $3 million to $5 million level. But typically, that's it. That's as far as you can leverage a single rock star—the product can only be in so many places in any given period of time.
This constraint doesn't seem important for a long time, because the band is on the road, the product is in demand, and business is rolling in. Changes are slow and imperceptible. Maybe the band isn't getting booked in as many stadium events—it's now mostly arenas, and a few clubs start calling. Promoters become more demanding, and the phone doesn't seem to be ringing as often—the balance of power starts to shift. The band realizes it has to work harder to make the same money. But it's easy to rationalize these changes, sometimes indefinitely. "It's the economy. Things have never been this tough, but business will pick up soon."
In a corporate environment, this is the critical crossroad. The rock star must recognize that every enterprise has a sine curve life cycle, and that the value of his current product inevitably is heading to zero. This is neither good nor bad—it's merely a fact. What will be good or bad are the decisions (or lack of decisions) the rock star makes in response to the challenge of staying relevant.
Every company in corporate America has followed the same path and either reinvented itself (IBM and General Motors)—or died (Bethlehem Steel and Pan American Airlines). Difficult decisions must be made and pursued aggressively. The rock star has to deliberately engage in "creative destruction," killing off the very company he built in order to preserve it.
Following this eureka moment, the first thing that has to happen is the rock star must begin to dissociate himself from "the product" and trust other people with his life's work. The next step is even more challenging: transitioning operational control of the company to a successor.
The rock star has to actively work at repositioning himself from the tactical solution or decision maker to the guru or senior statesman operating at a higher level. He must change his headset from "I can" to "Icon."
Ironically, once the rock star creatively destroys the company he built, he is free to create something more impactful than the original iteration. Many rock stars only become superstars after they've turned over operating control of their companies (Ken Blanchard has written more than a dozen best-sellers since turning over the reins of his company—and revenues have skyrocketed).
The enlightened rock star, unfortunately, is the exception rather than the rule. Most choose to keep pushing forward down the path of past successes—working longer, pushing harder, and blaming the marketplace for declining revenues. Before he knows it, the rock star finds himself playing alone for tips in an empty pub—telling tales of past glory. Then one day, it's over.
By 1998, Carlos Santana was no longer in touch with the mass audience—so he hired a new chief operating officer (Clive Davis, Arista Records). Clive suggested that Carlos team up with Rob Thomas, Dave Mathews, and several other popular young artists to do all the writing and singing on his next album. This must have felt uncomfortable for the virtuoso soloist. But when the dust settled, it was Santana's name on the cover of the Album of the Year, and it was Santana who won nine Grammys.
The superstars are those who make the difficult choices.
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