Will your company flourish like Germany or die like Brazil?

Germany inflicted the heaviest ever World Cup defeat on the hosts Brazil. Photo: Reuters

I’ve just managed to calm down from watching my German national football team absolutely devastate Brazil, the hosts, in the World Cup semi-finals. How did Brazil fail so miserably, and how can you ensure your company performs more like Germany?

I love football, especially at the World Cup and European Championships when powerhouses collide. Last night, the tournament favorites and hosts Brazil met Germany (my team) in the semi-finals. It was predicted to be a very close match, with Brazil’s physical no-nonsense play preventing Germany from playing their quick, passing-based game. I’ll admit, I was extremely nervous, based on how close some of Germany’s previous games had been (especially the nail-biter against Algeria).

The final result: Germany beat Brazil 7 – 1.  The single biggest win/defeat in a world-cup knockout game of all time. It was ruthless and merciless, with 5 goals being scored before halftime.

But if you look beneath the skin of what just happened, there are a lot of important lessons around leadership which company managers should consider. If you make the same mistakes the Brazil federation did, then you may end up getting knocked out by a competitor. 

Brazil were too reliant on ‘star individuals’

Because of an injury and a suspension in their previous match, Brazil had lost two of their most important players: Neymar, their creative force and main source of goals, and Thiago Silva, their captain and defensive organiser. When the rest of the team was forced to perform without them for the first time, they didn’t know their roles, or just didn’t perform at anywhere close to their own potential level. Before the match started, the Brazil team was even seen carrying Neymar’s shirt onto the pitch for the national anthem, nearly treating him as a messiah without whom they knew they would not be the same. And it was with good reason: in the previous games, Neymar had been the only attacking player exhibiting any quality needed to win a game. But it seemed that the loss of their defensive leader actually had more of an impact, as the other individuals seemed lost without him.

Look at your own organisation, are there any individuals who shoulder an unproportionate amount of burden and expectation? What would happen if that person had to leave, perhaps because another company made them an offer they saw more value in? This is why you need to invest in continually training your people, so that talent and skills are spread throughout the company. Innovative teams actually perform best with constant mixing of people throughout the organisation, to ensure one team doesn’t fall into bad habits.

Brazil couldn’t adapt once things got out of their control

Brazil didn’t look that bad in the first 10 minutes of the game. The first German goal deflated them slightly, but it was the second goal which killed Brazil. Why? It came in the 23′ minute. Goals 3, 4 and 5 all came within the next 6 minutes after that! Brazil had just completely lost their heads and forgetting to perform the basic tasks required to defend. They were punch-drunk. Even worse, even though they stopped Germany scoring for a while after that Blitz, and they knew they needed to score several goals themselves, they were unable to change their tactics, formation or players to have any impact.

In contrast, many of the German players have had to develop the ability to deal with setbacks and failures, having lost the previous two World Cup semi-finals and a European Final. What this has forges is a resilience and ability to adapt when things go wrong, all while still keeping your eyes on your ultimate goal.

Similarly, every business will have setbacks. Some will have a short-term impact, like losing a specific client, but every now and again every company and industry will face something which requires them to fundamentally change the way they do business. In the innovation world, we call this a disruptive innovation. And when you company is faced with a competitor doing something differently which is affecting your business (usually by showing your customers new value), then you have only one option: adapt by changing aspects of your business. It’s not that hard, after all there are Ten Types of Innovation, and doing multiple types makes it more likely to be successful. But if your competitor or an upstart has just scored several goals against you, you need to adapt, otherwise you’re losing that game and going home.

Germany has invested €500+ million into building a foundation for the team. Brazil’s foundation is crumbling

Germany has taken a long road to the finals of the 2014 World Cup, and it all began at the Euro 2000 tournament where they performed terribly due to an ageing team without much technical ability. Even though they made it to the World Cup 2002 final (where they lost to Brazil, ironically), Euro 2004 was equally bad. So bad that the DFB, the German Football Association, decided that sweeping reforms were needed and in late 2000 they changed the structure of the football leagues to encourage investment in club financial security, coaching at all levels, but most of all, youth academies at all clubs. The result is that over the past decade, German clubs have been producing an enviable number of technically skilled young players who play regularly in one of the best leagues in the world.

Not only that, but the league clubs and the national team have developed a sort of unofficial shared ethos to play football in a certain way (positive, passing based on good technical skills, retaining possession but also defending powerfully), which enables players to gel with each other once they come together in the national team.

Brazil on the other hand has no such coordinated development track. Worse still, it doesn’t have equivalent investment in the infrastructure needed to develop talent (very different from the abysmal organisation of building infrastructure for the World Cup). Where Brazil used to be known for producing players who played with a Samba Soul and outrageous skill, now many of their players are turning into athletes known for their running and tackling. The result was a Brazil team without their one truly creative player yesterday looking completely second rate compared to Germany with a surplus of technical talent.

This is why it is vital for companies to continue to invest in developing their capabilities. This includes both the skill of their workforce, but also the capabilities they need for business. Innovation helps build capabilities and keep the company moving forward, but once investment in innovation stops, companies will begin to stagnate, and eventually turning their efforts towards protecting what they already have. This is when more flexible competitors come in and out-maneuver you. So look at how much you are investing into your people and capabilities, and ask if that is enough to grow, rather than just survive.

What did you think of the match? Did you enjoy it as much as I did? Let me know in the comments below.

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