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Analysis

Creative Destruction

Analysis

BBC

News, Politics

4.61K Ratings

🗓️ 11 February 2013

⏱️ 29 minutes

🧾️ Download transcript

Summary

In the last few weeks a number of high street names have closed for good. In Analysis Phil Tinline asks whether, amid the gloom, there is a reason to celebrate. The economist Joseph Schumpeter first coined the phrase "creative destruction" in the 1940s. Innovation he believed causes the death of established businesses and leads to new opportunities. So, are company failures necessary for future growth? Or is "creative destruction" a comforting delusion, not a saving grace? Producer : Rosamund Jones.

Transcript

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0:00.0

Just before this BBC podcast gets underway, here's something you may not know.

0:04.7

My name's Linda Davies and I Commission Podcasts for BBC Sounds.

0:08.5

As you'd expect, at the BBC we make podcasts of the very highest quality featuring the most knowledgeable experts and genuinely engaging voices.

0:18.0

What you may not know is that the BBC makes podcasts about all kinds of things like pop stars,

0:24.6

poltergeist, cricket, and conspiracy theories and that's just a few examples.

0:29.7

If you'd like to discover something a little bit unexpected, find your next podcast over at BBC Sounds.

0:36.0

Thank you for downloading this edition of Analysis from the BBC.

0:40.0

In this programme Phil Tin Line explores the idea of creative destruction

0:44.4

and asks what it can teach us in troubled economic times.

0:48.0

So here we are in your office. There's a chart on the wall in front of us

0:51.8

headed 100 years of UK equities what's it about?

0:55.0

It's a demonstration of just how many of these businesses have disappeared.

0:59.0

So for example in 1975 Burma Royal went bust. Similarly in that year Jim Slater and Slater

1:05.6

Walker got into trouble and disappeared subsequently.

1:09.3

Then in the 90s you had...

1:10.3

Luke Johnson is a serial entrepreneur. but why would a successful businessman want to be reminded of so many businesses that failed?

1:18.0

I have this chart just to remind me that you need to be reinventing, adapting and constantly innovating to stay alive and relevant.

1:26.8

The idea at work here is simple.

1:29.4

The force that drives capitalism relentlessly onward is innovation and as new

1:34.8

products and new ways of doing business are ceaselessly invented they leave the

1:39.1

old strewn in their path. Like a permanent gale, fresh ideas transform sector after sector.

1:47.0

The iPod took everyone by surprise, Apple included in Steve Jobs as well. They had no idea really what they had created. The chief executive

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