Depreciation & Destruction


The activities of Depreciation and Destruction are part of the Sustaining set of activities on the Strategic Positioning Spectrum. Unlike other areas of The Spectrum, the defining characteristic of Deprecation is often represented by a lack of change. All successful maintenance activities require updates and changes over time. Business depreciation often happens as a matter of time and inattention rather than poor choices. The mistake is assuming that work can go on as the status quo indefinitely. Or, an organization may have a rate of sustaining change that doesn’t keep up with a marketplace. Businesses can feel like they drop in popularity or market share, though it’s better to think of the situation as a car that doesn’t adjust its speed for entry on the highway. Its constant rate feels slower and slower merely because others are going faster. Eventually depreciation will have an active downward turn once revenues suffer and talent leaves.

Positive Depreciation
The activity of depreciation doesn’t have to be all negative. Sometimes products or activities need to sunset or wind down and stopping them with no warning or transition would be detrimental. Responsible depreciation requires systematic reduction and shifting of work and personnel. This can become necessary when a newer version of a product is introduced but the older version must be supported for a time. This is most commonly seen with products like software or car models. Support for an outgoing car model or software version may feel like a low priority, but customers will judge future experiences on how an older model is phased out.

The key to positive and productive depreciation is making it part of a strategy from the beginning. It’s best to think of it as planning for retirement. If you only start saving when you’re ready to quit it’s too late.

Destruction marks the end of the activities for a product or service…or entire organization. If well planned it can be positive. Customers of the outgoing product should be ready to adopt the newer version if the depreciation activities included proper customer education and research. Even when it’s against the will of an organization it can be done on strategy and respectfully to those that support the product or business as a whole.

Destruction is often on the other side of the coin with Foundation. Once the automobile was fully founded in the american economy, the horse and buggy experienced its virtual destruction. This is most commonly seen in the technology industry. Vinyl records led to 8-tracks which led to cassette tapes which, in turn, were eclipsed by CDs and finally digital and streaming formats. Sometimes the depreciated or “destroyed” product makes a nostalgic comeback as with vinyl records. Though, streaming music providers are unlikely to be concerned by their presence.


The Strategic Web is an independent consultancy focused on innovation strategy. I help businesses and organizations develop strategies to differentiate themselves in the marketplace and progress out of static practices.

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Scott Hutcheson