Business Strategy: Creaming

creaming

In the past week I have been sending information to a Silicon Valley consulting firm seeking a dialogue and an estimate to incorporate into my business plan for my startup.  Today I received a reply that the consulting firm was ending discussion because they did not want to do work that did not guarantee paid business.

In Peter Drucker’s book, Innovation and Entrepreneurship, such a strategy is called “creaming”.  It is a business plan that seeks to maintain the status quo while also seeking the largest profit margins.  This strategy allowed Japanese mini-mills to undermine and destroy the American steel industry and Japanese auto makers to undermine and destroy the American auto industry.  It is no surprise that Peter Drucker was fired by General Motors.  Now, we are facing the same business plans in the American information technology industry.

Today, I appealed the decision of that consulting company’s Vice President and wrote directly to the Owner.  I have pointed out Drucker’s observations.  I have also decided that if my appeal fails, I will go to information technology companies outside the United States.  I do not want to be part of the recurring American addiction to a recipe for disaster.

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