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Lessons From The Case

Theranos had three key lessons: 1) Internal competition between engineering teams led to stress and talent loss as many employees resigned or were fired. 2) An overly ambitious goal of running 70 tests on small blood samples burned out employees who worked long hours, leading top engineers to leave. 3) Strongly emphasizing a shared vision from Holmes pushed out dissent and fired those who disagreed, keeping Theranos on a singular path that ultimately failed. The most important factor in Theranos' downfall was centralized command under Holmes.

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Abhijit Dhar
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47 views1 page

Lessons From The Case

Theranos had three key lessons: 1) Internal competition between engineering teams led to stress and talent loss as many employees resigned or were fired. 2) An overly ambitious goal of running 70 tests on small blood samples burned out employees who worked long hours, leading top engineers to leave. 3) Strongly emphasizing a shared vision from Holmes pushed out dissent and fired those who disagreed, keeping Theranos on a singular path that ultimately failed. The most important factor in Theranos' downfall was centralized command under Holmes.

Uploaded by

Abhijit Dhar
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Lessons from the case:

 First, Theranos was very competitive internally: - At one point, Holmes hired two
engineering teams and had them compete with each other to come up with the best
solution for their blood-testing device. Undeniably a healthy level of competition will
motivate employees to work harder, but when the competition becomes too hostile,
employees will feel stressed and detached. In the case of Theranos, many employees
either resigned or were fired, leaving the company without talent.
 Second, Theranos was set on an ambitious stretch goal — making a device that
can run 70 blood tests on only a 25–30 microliters blood sample. On the one hand,
setting high goals might lead to amazing outcomes but on the other hand, employees
might feel burned out and demoralized. The latter was what happened at Theranos.
Employees were forced to work overtime every weekday and even had to go to the
office on the weekends sometimes. This also led a lot of top engineers to leave the
company.
 Third, Theranos also strongly emphasized a shared and unified vision: - “The
miniLab (name of Theranos’ device) is the most important thing humanity has ever
built. If you don’t believe this is the case, you should leave now,” Holmes once
declared in a speech to Theranos’ employees. Such a declaration could boost the
morale of the company and make employees more committed to their work. However,
it also pushed out all deviants. Employees who had different but important insights
went silent for fear of losing their jobs. And the ones that did voice their oppositions
indeed got fired. This kept Theranos running firmly along Holmes’ vision which
ultimately led to its ugly outcome.

But the most important aspect of Theranos’ culture that led to its downfall is its
centralized command.

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