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CORDER’S COLUMN: Secrecy and thin skins could damage the Swiss more than quartz

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Rob Corder, managing editor, WatchPro and managing director of Promedia. (Photo by Ausra Osipaviciute/ITP Images)

Remarkably few blockbuster businesses maintain their dominance from one generation to the next. 

I say a generation, by which I mean about 30 years, because it is an awfully long time to maintain market leadership or a growth trajectory.

Founders with vision and energy can make an incredible impact for a decade. But sustaining it for 30 or more years is incredibly tough and they normally hand over to a younger executive team, some of which take businesses to even greater heights, but most of which manage slow decline.

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History is littered with industrialists, banks, airlines, technology companies, car makers, media giants and myriad others where the best days are behind the biggest companies.

The Swiss watch industry likes to think it is different, and businesses that have been manufacturing more or less the exact same product since the 18th century have reason to believe they can defy normal business wisdom as the world changes around them.

These venerable watchmakers, however, have not enjoyed centuries of uninterrupted success.

Most have failed multiple times and what has survived, thankfully, has been their names and their archive of historic references.

The brands that lord it over the Swiss watch industry today had virtually no capital value when their names, and not much else, were rescued from the scrap heap by incredible entrepreneurs that have built Richemont, Kering, LVMH and Swatch Group over the past 50 years.

I make this point not to besmirch the reputations of some truly exceptional watchmakers and business leaders, but to make the case that there is no god-given right for them to thrive in the future.

The industry is changing so dramatically now that only the nimble and exceptional are assured a future for another generation.

A trait that troubles me most is how secretive, sensitive and thin-skinned the Swiss watch industry remains today.

These are characteristics that have might have been considered assets until 10 years’ ago, but I believe will be weaknesses in an era that increasingly values transparency and authenticity.

Right now — I would not overstate this hypothesis — I believe we are already seeing the impact that CEOs who are open and accessible are making at brands like Audemars Piguet and Breitling.

The Wizard of Oz mystique of pulling levers from behind a curtain is hugely powerful for a time, but we all know how it ends.

I am not suggesting that the Swiss should throw away all the history and tradition that has brought them to the global leadership it enjoys today.

What I am saying is that it needs to be open to ideas, to challenge and to criticism.

Above all, the Swiss watch industry needs to stop being so sensitive and thin-skinned. These are not traits that the world values much these days.

Every new product is instantly reviewed on social media by millions of enthusiasts whose voices need to be heard.

Strategy should not necessarily be dictated by the social media mob, but it cannot be ignored, and nor should the views of more expert commentators who have ideas on how things can change and voice them only because they want this industry to thrive for centuries to come.

 

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1 COMMENT

  1. Well-stated Rob. Sadly, many firms in the industry are secret and siloed, and act a bit like Luddites. Nostalgia in small doses is comforting, but in excess it’s a killer. Just because you’ve done it and done it well for a century or more is not an instant guarantee of futre success. Many marquee retailers and brands that failed to innovate are now just a historical name. In a milieu today where the consumer will decide (with their wallet) how, when, and where they will transact with your brand, if you are not refocusing your business strategy in a direction that is congruent with the values and desires of today’s consumer, if you are not implementing the digital tools that make sense for your business, you will be left with nothing but nostalgia. One can respect heritage, honor DNA, and still innovate for the future. Some will lead these new trends, others will chase after them, and inevitably, many of those will disappear into irrelevance, obscurity, and nonexistence.

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