Definitions & Concepts
This term describes a sudden collapse in performance, usually over a few quarters.
What is free fall?
A competitor introduces a breakthrough technology, causing your market share to collapse.
What is disruption by a competitor?
These three crises of growth are described in The Founder’s Mentality.
What are overload, stall-out, and free fall?
Ted Miller founded Crown Castle on this opportunity.
What is the business of owning and leasing cell towers?
After losing touch with its original bold mission, a company decides to revisit and clarify its purpose to energize the team and reconnect with customers.
What is redefining the insurgent mission?
Free fall is more abrupt than this other growth crisis.
What is stall-out/ overload?
As companies grow, this founding purpose often gets diluted, slowing their ability to respond to market shifts.
What is the insurgent mission?
This key trait of the founder’s mentality is a bold, customer-focused purpose that drives a company’s founding. It is often aimed at defeating industry incumbents or changing the rules of the game.
What is the insurgent mission?
This global semiconductor company faced free fall risks due to intense competition and rapidly changing technology markets.
What is NXP?
When a company in free fall strips away nonessential businesses and focuses intensely on its most profitable and mission - critical products or services, it is applying this solution.
What is focusing on the core of the core?
Free fall often threatens a company’s survival within this short timeframe.
What is a few quarters to a year?
Too much focus on internal complexity and approval processes leads to slow responses to customers.
What is bureaucracy or decision-making bottlenecks?
This mindset encourages accountability, cost awareness, and a long-term focus as if one personally owned the business.
What is the owner’s mindset?
This brokerage went into free fall in the early 2000s due to online competition.
What is Charles Schwab?
This solution involves empowering frontline employees with decision-making authority and tools to directly address customer needs, helping a company escape free fall by reconnecting with its core mission.
What is rebuilding the company at the front line?
In free fall, internal complexity creates this downward cycle where bureaucracy grows as performance drops.
What is the complexity doom loop?
Customer preferences change faster than the company adapts, creating this dangerous gap.
What is the relevance gap?
Companies with the founder’s mentality often have an obsession with this part of the organization, where the customer is served.
What is the front line?
One key cause of NXP’s free fall was a shift from innovation-led growth to this focus, contributing to slower adaptation.
What is bureaucracy or internal complexity?
When a company facing free fall commits significant resources to develop a new technology or capability to regain competitive advantage, it is applying this solution.
Invest Massively in a New Capability
One hallmark of free fall is the breakdown of this connection between leadership and the customer-facing parts of the organization.
What is front line connection?
Over time, companies shift from an insurgent mindset to this, focusing more on defending the status quo.
What is the incumbent mindset?
Overload happens when growth outpaces this key business capacity.
What is the organization’s ability to manage complexity?
During its free fall, LEGO lost touch with this core part of its business that initially made it a beloved brand, contributing to declining sales and market relevance.
What is the frontline customer experience or core product focus?
To escape free fall, this approach involves committing substantial investment to build new skills, technologies, or business models that reposition the company for future growth.
What is investing massively in a new capability?