Newly created companies are joining the competition pool that has been existed since long time ago. Existing companies that have more knowledge and experience might threat the new companies. Newbies might not have customer base at all. They have to build their customer base as fast as possible so that there are some people who actually buy their products. Entrepreneurs of newly created companies will lack important management skills suck as leadership skills, cash handling skills, and decision-making skills. If the head of the company fails to lead the company, then the whole company might lost its motivation thus will be in danger. Sometimes, there's a threat coming from outside the company. Change in the business environment, such as legal changes, economic changes or technological changes, are always the potentials of risk. The company can not stop it, but rather they should find a fast way to overcome the changes.
Wang Laboratories
Wang Laboratories was a computer company founded in 1951 by Dr. An Wang and Dr. G.Y.Chu. They produced word processors, minicomputers and microcomputers. It had annual revenues of $3 billion and employed over 40,000 people at its peak. Wang Laboratories filed for bankruptcy protection in August 1992.
Wang Laboratories is an example of company that failed because of the changes in the business environment. A common view within the PC community is that the company failed because it specialized in computers designed specifically for word processing and did not foresee the emergence of general purpose personal computers.
