One of the dilemmas of firms in rapidly transforming environments is that their ownership structure may get in the way of making tough decisions. Investors in publicly traded companies are understood to desire stable, predictable earnings and growth. But such expectations are unrealistic in many industries. As noted management expert Geoffrey Moore told me with respect to high-velocity competition, “I’m not sure you ever want to be in the public markets.” The problems with public markets and quarter-by-quarter thinking are many, but for companies in fast-changing environments the biggest issue is that public markets are not patient — miss a quarter and the punishment can be severe.
Parting Ways with Public Trading
Privately-held companies have a better chance of retaining a leadership position.
May 10, 2013
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Innovation and Creativity Course
Accelerate your career with Harvard ManageMentor®. HBR Learning’s online leadership training helps you hone your skills with courses like Innovation and Creativity. Earn badges to share on LinkedIn and your resume. Access more than 40 courses trusted by Fortune 500 companies.
Unlock your team's curiosity and willingness to take smart risks.