FAO Schwarz, the legendary toy story in New York that was immortalized by Tom Hanks playing the “ floor piano” with his feet in the movie “Big,” closed this week after operating since 1870 and boasting 40 stores at its peak. Its demise is attributed to some of the same forces that have claimed other retailers such as the cost of brick and mortar and the surge of online shopping.
You can read numerous stories about the company’s failure, but more important is why it succeeded and endured for so much longer than most businesses. The company literally established its industry because when it was founded, the toy market in the US was almost non-existent. For a few valuable lessons check out this Fortune Magazine Article from 1940 that traces the history of FAO Schwarz to that point and analyzes its successes, which many said came from the fact that the founder “always tried to get what was good and exclusive,” and: “They always believed Schwarz.”
Value and trust. Some things never change.
An important lesson is the need for inspired innovation and forward thinking leaders who are not always so anchored in the past that they can not see the future.
Now ask yourself, are you a leader?