TightWind is written by Kyle Baxter. Stay Hungry. Stay Foolish.

What’s even more dangerous for a company than not being profitable is not understanding why they are successful. Success doesn’t beget success. Understanding the reasons for it does.

When a company has a hugely successful product, the human tendency is to stick to it—get all you can out of it before moving on. This makes some sense. Why would you move away from something that’s provided your company with huge profit margins and a beautiful bottom line? And shouldn’t you squeeze every dollar out of your investment in a product before moving on?

This tendency, whatever its origin, is a fantastic way to fade into irrelevance. While you’re still evolving your Walkman, refining it toward CD-playing perfection, someone else will sell the iPod.

Peter Drucker wrote in Management:

The root cause of nearly every one of these crises is not that things are being done poorly. It is not even that the wrong things are being done. Indeed, in most cases, the right things are being done—but fruitlessly. What accounts for this apparent paradox? The assumptions on which the organization has been built and is being run no longer fit reality. These are the assumptions that shape any organization’s behavior, dictate its decisions about what to do and what not to do, and define what the organization considers meaningful results. … They are what I call a company’s theory of the business.

You shouldn’t just be thinking about how you can improve your current products—how you can make your horse-and-carriage a little lighter, a little cheaper, a little better. You must be thinking about whether your assumptions about the business you’re in are the same as they were yesterday. You should be thinking about what will make the horse-and-carriage irrelevant, and how you can be the one to do it.

To be successful in the long-term, you need to be willing to slaughter your own golden gooses.

It’s risky. You could guess wrong and release a new product that has no chance of succeeding. But sticking to what’s worked, because it worked for a while, has no risk: you will fail.