ITT Corporation

Harold Geneen built ITT into the archetypal conglomerate cautionary tale. Between 1960 and 1977, he acquired more than 350 companies, growing annual revenue from $800 million to $22 billion and swelling the workforce to 368,000 employees. ITT's portfolio spanned Sheraton hotels, Avis rental cars, Hartford Insurance, Continental Baking (Wonder Bread), and telecommunications equipment. Geneen's strategy assumed that professional management could run any business—that gene flow between unrelated entities would create hybrid vigor.

It didn't. ITT forced subsidiaries to adopt corporate systems, transfer resources between divisions, and chase arbitrary financial targets set by headquarters. This is the biological equivalent of forcing genetic exchange between reproductively isolated species: local adaptations get disrupted, fitness declines. A hotel chain and an insurance company face completely different competitive environments, customer behaviors, and operational rhythms. Forcing them to share back-office systems and management practices degraded both.

The Justice Department blocked ITT's attempted acquisition of ABC in 1968 on antitrust grounds, then challenged the Hartford Insurance takeover in 1970. These regulatory setbacks exposed the conglomerate's vulnerability: growth through acquisition has natural limits when regulators enforce competitive boundaries. By the 1980s, under CEO Rand Araskog, ITT began divesting the Geneen-era acquisitions. Continental Baking went in the mid-1980s, telecommunications businesses spun into Alcatel N.V. in 1987.

The breakup accelerated in 1995 when ITT split into three separate companies: ITT Hartford (insurance), ITT Industries (defense and automotive), and a 'new' ITT (hotels, casinos, Madison Square Garden). Starwood Hotels acquired this remnant in 1998. The 2011 breakup carved ITT Industries into three more pieces, spinning off water treatment and defense businesses.

The company's trajectory contrasts starkly with Berkshire Hathaway's decentralized model. Where ITT forced integration and resource transfers, Berkshire enforces isolation. ITT subsidiaries reported to layers of corporate management; Berkshire subsidiaries report to a 25-person headquarters. ITT's gene flow model destroyed value; Berkshire's reproductive isolation preserves it. The conglomerate discount that plagued ITT throughout the 1980s-90s vindicated the biological principle: unrelated organisms thrive when allowed local adaptation, not when forced to share genetic material across species boundaries.