Fast Talk: The Old Economy Meets the New Economy

Lightning Round 1: Lessons From the Old Economy

Alan Webber (founding editor, Fast Company): Rumors of the death of old-economy companies, it turns out, were not only overhyped, they were flat-out wrong. To get started, let's have a lightning round: What's the biggest misconception that you've heard over the past couple of years about what was wrong with old-economy companies? You choose: Gloat or vent.

Amy Williams (vice president, finance and planning; Allstate Insurance Co.): People kept telling us, "You just don't get it. It's about how many customers you have." But no one talked about the economics. To me, the great lesson is that you have to focus on both the customers and the economics.

Fred Crawford (executive vice president, consumer products, retail, and distribution; Cap Gemini Ernst & Young Consulting Services): New companies were overhyped, old companies were maligned, and both were wrong. The reality is that consumers have changed, and what they want has changed. Going forward, we're going to require a blend of the best that new- and old-economy companies have to offer.

Jim Sappington (vice president, U.S. information technology; McDonald's Corp.): The idea that old-economy companies can't change or are too big to move fast is wrong. Right now, we're seeing old-economy companies move much faster than we thought they could.

Warren Holtsberg (corporate vice president, venture investing; Motorola Inc.): My favorite misread was the idea that business fundamentals had changed -- that the traditional ways of doing business didn't matter anymore: If you sold enough product or enough items at a loss, eventually you'd make a profit.

Betsy Cohen (vice president and futurist, extended enterprise group; Ralston Purina Co.): According to new companies, you had to do everything quickly, and our large companies couldn't react or were too slow. In reality, I don't think that we were too slow. We moved quickly on some things. On others, we didn't -- and maybe that was wise.

Lars Nyberg (chairman and CEO, NCR Corp.): Absolutely the biggest misconception was that profit isn't important. But people also grossly underestimated the importance of understanding the customer.

Eric C. Dean (senior vice president and CIO, United Airlines): You can't eat bits and bytes. You can't fly on bits and bytes. You actually have to do something. The aura of magic around the Internet was one of the biggest hypes.

Mike Brennan (senior vice president, marketing and product management; Peapod Inc.): I'd fault new-economy companies for doing things just for the sake of doing things, versus having the fiscal discipline to do things that are smart -- and smart in the long term. It's about having the discipline to understand what's real and what's smoke.

Mary Lee Schneider (president, Premedia Technologies; R.R. Donnelley & Sons Co.): I'd say that the greatest misconception was the belief that print is dead -- which is kind of a hoot, since it's one of the most cost-effective ways to reach the consumer. But going forward, we may have to face an even more dangerous misconception: that it's the old economy versus the new economy, when it's actually a combination of the two.

Brad Brinegar (CEO, Leo Burnett USA): There was also the misconception that big is bad. But in fact, there wasn't a new-economy company out there that didn't want to be big. Most of them just never got there. Smaller companies faulted big companies for being slow. But those big companies got big for a reason. They did something right. Now the question is, Can big companies get past what they used to do in order to do the right things now to keep moving forward?

Lightning Round 2: One Cheer for the New Economy

Alan Webber: For all of the wreckage among hot new startups, they must have contained some useful, even important, insights. What were they right about?

Brad Brinegar: Two things: First, they didn't have legacy systems. They were starting from scratch. Second, they were free to innovate. Our business is all about innovation. Big companies that continue to innovate will win. The ones that forget that innovation is what drove them in the first place will die.

Mary Lee Schneider: What was really great about new-economy companies was that they were willing to challenge everything. They were willing to challenge the status quo and the whole concept of profitability -- which ultimately was a flawed challenge. They forced a lot of us who might not have gotten past our own inertia to adopt new technologies and new capabilities. The suspension of gravity -- however temporary -- helped us to move in new directions.