Fred knew just what customers wanted. He had attended several focus groups in which customers made it forcefully clear that Fred's products were terrific yesterday, but not quite right for tomorrow. They wanted some changes that were already beginning to appear in competitive products.

They also wanted changes in Fred's voicemail. It was a time-consuming system that routed a caller from one menu to another, but never, it seemed, to what a caller wanted. If you didn't know the extension of the person you wanted to reach, you were subjected to layers upon layers of choices. Many customers gave up and stopped calling Fred's company. The voicemail was just too irritating.

Fred wanted to make some changes but he didn't have the authority. He'd have to talk to Charlie, the big boss, and the prospect wasn't pleasant. Charlie had too much experience to be challenged. He had an historical perspective on everything and an answer to every challenge.

Fred remembered the two rules he had learned early in his career: "Rule 1-The boss is always right. Rule 2-Refer to Rule 1." Nevertheless, he felt it was necessary to talk to Charlie about what he had learned.

The meeting started with the usual pleasantries. Then, very gently, Fred broached the subject. "You know, Charlie," he began, "I've been thinking that maybe we should make some changes in our product line. I've been picking up bad vibes from customers at focus groups and they're beginning to switch to Jack's company." And Fred presented a list of changes he felt were needed.

"That's ridiculous," Charlie responded. "We've been making this line for years and improving it all the time. The performance is fine and the reliability is terrific. We're experts at this and the customers are not. If a few customers are switching to Jack, they'll regret it and they'll be back. Jack's outfit has no history."

Fred pointed out that there had been other companies, like Hewlett-Packard, IBM and Microsoft that, in their early days, had no history, but Charlie brushed those examples aside. Jack's company was no IBM, he challenged.

Then Fred brought up the matter of the voicemail system. Charlie had a ready reply: "We haven't had any complaints. Before you came along, I didn't hear a single complaint." Which was certainly true. Customers who can't reach you don't complain to you. And customers who are fed up with your system don't bother trying to reach you.

Slowly, then more quickly, Charlie's business was slipping. At first, Charlie blamed the economy. But then he noticed that more business was going to Jack and other competitors. It was no longer possible to blame the economy. Charlie blamed Fred.