Many people consider the creation of Netflix to be one of the best business decisions of the last 15 years. That said, many also consider the decision to separate streaming movies from DVD rentals to be one of the company’s worst blunders. It’s not unusual for CEOs of big businesses to make stellar moves and some that they’d rather forget.
In that vein, here are 10 of the worst business decisions of all time.
Many people remember Ross Perot’s failed presidential campaign. What you may not know is that, for a shrewd businessman, Perot made one of the worst decisions in the history of business. Way back when, a young Bill Gates was looking to sell Microsoft for around $50 million. It was 1979, and the asking price, according to Perot, was just too high. Gates refused to budge and Perot passed on the offer, now calling it one of the biggest business mistakes he’s ever made.
In 1999, Excite decided to pass on Google’s selling price of $750,000. Today, the Internet giant is valued at over $180 billion dollars, making the original asking price seem like chump change. Just years after Excite passed on the deal, it found its stock plummeting and it was bought out by AskJeeves.
In 1980, IBM approached Bill Gates, asking that he develop an operating system. Gates’ only stipulation? That he retain the rights for the platform. IBM agreed, much to their chagrin. Microsoft rules the roost, and IBM has no control over the platform.
William Orton was the president of Western Union in 1876. When approached by Gardiner Greene Hubbard to purchase the patent for the telephone, Orton declined. His reasoning was that the phone resembled nothing more than a toy and would never catch on.
There’s little doubt that you have a favorite M&Ms character. The little round candies have made their way into the hearts of the masses. If you’re old enough to remember “E.T.,” you remember that Reese’s Pieces made an appearance in the film. Fortunately for The Hershey Company, makers of Reese’s, Mars, Inc. refused to allow Amblin Productions to use their candy in the movie.
What was wrong with the old Coke is the question millions asked when New Coke was introduced. Even though it received mass approval in taste tests, New Coke was met with millions of disgruntled consumers when it was released. Coke had to scramble to introduce Coca-Cola Classic to placate its fans.
Can you imagine anyone turning down the Beatles? That’s exactly what Decca records did in 1961. Instead, Decca signed Brian Poole and the Tremeloes. Ever heard of them?
8.NBC and CBS
Way back in the 60’s, baseball was America’s pastime. Few people had an interest in watching professional football, leading both NBC and CBS to pass on Monday Night Football. ABC took the chance and Monday Night Football became one of the longest running series of all time.
ABC can’t do everything right. NBC saw the wisdom in Bill Cosby’s idea, accepting his pitch and purchasing the show. For six seasons, “The Cosby Show” was number one in the ratings. NBC, subsequently, became the number one network.
In the 90’s, Kmart faced stiff competition from up-and-coming mega-giant Wal-Mart. Kmart made a few moves a little too late, trying to keep up with the prices offered by Wal-Mart. The result? Kmart closed hundreds of stores, filed bankruptcy, and eventually merged with Sears, Roebuck.
No one can be expected to make the right decision every time. Unfortunately, some of these business blunders resulted in the loss of millions of dollars of revenue. Take a chapter from these mistakes and name it “What Not to Do.”