Understanding the Importance of Developing Your Company’s Qi - Ultimate Success vs. Eventual Failure

Companies spend all of their time developing their outer strength around their product or services offerings (merchandising), operations, finance, marketing, sales, and customer service. It is a constant challenge of successes and failures. As a rule, those companies who execute these functions more successfully than their competitors fare better. It is the development of a company’s Qi that is the true differentiator and determines the long-term health, success, and the ability of a company to reach its potential.

The ancient Chinese described qi as "life force". They believed it permeated everything and linked their surroundings together. In an environment of constant and rapid change, it is qi, the company’s inner strength that ultimately determines the long-term success of a company. It is this inner strength, the qi, that allows companies to reinvent themselves. It is vision, discipline, imagination, courage, and openness to new ideas that comprise this inner strength, the qi.

The marketplace is littered with the remnants of once proud and successful companies that executed the aspects of outer strength but did not develop their qi. The recent pandemic ushered in the demise of companies from Borders, Pier 1 Imports, Toys R Us, and more.

Changes in technology and the marketplace signaled the death knell of Blockbuster, Palm, Compaq, Eastern Air Lines, Midwest Airlines, Pan American, Oldsmobile, Pontiac, Plymouth, Saturn, Bell Telephone, and so many more.

There are companies that developed their qi and are thriving. Amazon started as an online retailer for physical books. When Amazon went public in 1997, there was little indication it would eventually dominate e-commerce and cloud computing, as it does today.

Netflix started in 1998 as a company that allowed consumers to rent and buy physical DVD movies. Its decision to invest in streaming and de-emphasize DVD rentals changed the entire entertainment landscape.

Slack, a popular business collaboration and chat application, began as a company called Tiny Speck that made a computer game called Glitch. The game itself was a flop and was shut down in 2012. Slack grew quickly, and the company went public in 2019. The company has more than 119,000 paying customers and more than 12 million daily active users as of late 2020.

YouTube started as a dating website. The approach failed, but as users of the site began to post whatever videos they felt like uploading, the founders embraced the idea. As of May 2019, users upload more than 500 hours of video on the site every minute.

Apple is the quintessential example of qi. It started as a computer company. Its founder Steve Jobs left the company, and it began to flounder. As a company, they have had a miraculous track record of disrupting industries and competitors particularly since Steve Jobs came back in 1997 and saved Apple from near bankruptcy and potential irrelevance. During Jobs’ second run at Apple, he pretty much reinvented the PC form factor with the candy color iMacs, the digital music player and smartphones. In 2010, even though tablets had been on the market for almost 20 years, Jobs reinvented the tablet with the iPad and has made it a highly successful new business for them. Apple has made all of these products icons within each product category and allowed them to become a $110 billion a year company with $160 billion in cash in the bank. By all measures, Apple is one of the most successful companies in history and continues to innovate in software and services along with introducing new models of their signature line of products each year.

What is true differential between billion-dollar companies that failed and those who continue to dominate the marketplace and maximize their potential? All the companies on both lists developed their outer strengths around their product or services offerings (merchandising), operations, finance, marketing, sales, and customer service.

Those companies who developed their inner strengths, the qi, reinvented themselves. It is vision, discipline, imagination, courage, and openness to new ideas that comprise this inner strength, the qi, and led to greater success as those around them failed.