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Conversations in Management

Harry B. Henshel

It just sort of wound down.

Harry Henshel was talking about the Joseph Bulova School of Watchmaking but he might as well have been talking about the entire company. By the time the school shuttered its doors in 2000, the Bulova Watch Company had long ceded it preeminence to others. In 1965 the company had 80% of domestic watch sales. Its Accutron brand was a sensation and was unparalleled for its accuracy and technology. In fact, the watch was so prestigious that President Johnson regularly gave them as gifts to visiting heads of state. It was so accurate that its mechanism was used to power a seismometer left on the moon by the first Apollo astronauts. Bulova wasn’t however, content with a luxury brand. They decided to take on Timex and introduced the budget Caravelle line in partnership with a Japanese manufacturer. Yes, things were looking good for Bulova in 1965. It was a company that was doing everything right: global partnerships, deep market penetration, innovative products and a 90-year reputation for quality.

Ten years later things looked very different for Bulova. Their market share had dropped to 8% and they experienced a staggering $21 million loss on sales of $55 million. It seems this marketing and tech savvy company had simply lost its way. A big part of the problem was that they failed to see beyond their own innovativeness. The Accutron had been a major technological advancement in watchmaking. It relied on a battery to vibrate a tiny tuning fork that in turn drove the watch’s mechanism. It was reported to be accurate within 2 seconds a day. The tuning fork technology was so radical, that it was used as a corporate logo. It came to define Bulova both to the public and to the company itself. That might not have been a problem if a superior technology hadn’t been ticking in the wings. It was the quartz crystal mechanism and even more accurate than the tuning fork. But Bulova was blinded by their image. They were the tuning fork people and couldn’t sacrifice that identity. They missed the digital revolution for the same reason. When the first digital watch was introduced in 1970, they dismissed it as a fad. By the time they realized their mistake, the game was over. Today Bulova soldiers on as a niche player making retro-style mechanical watches. It’s a sad harkening back for a once powerful company.

The Bulova story provides a cautionary tale for leaders in today’s fast-paced environment. We all know the obvious risks of being change resistant or a technological Luddite. But what if you see yourself as a change agent and as a champion of innovation? How do you avoid being Bulovaed? You might start by falling out of love. Once you find a comfortable identity for yourself it’s hard not to do things that bolster the image. If you see yourself as an avant-garde advocate for change, you might well discover yourself encouraging change where none is necessary. If you see yourself as a tech warrior in search of the latest killer application, you might end up promoting esoteric solutions that don’t work for anyone. Or, if you really love your image, you could decide that things couldn’t be any better than the way you’ve artfully arranged them. No matter how it plays out, getting too comfortable with your professional identity can lead to complacency. It can blind you to opportunity and keep you from taking risks while lulling you into believing you’re doing everything right. So the next time you’re comfortable with a decision, check the time. If there’s not an Accutron on your wrist, take it as a reminder that you may be missing something important. There’s still time…

—Ebert