Introduction to Pyrrhic Victory
Pyrrhic victory refers to a victory or success that comes at the expense of big loss or cost. It is pronounced as ‘pɪrɪk/ PIRR-ik’. In a company, examples of such a victory may involve winning a lengthy and costly case or prevailing in a hostile takeover bid.
For instance, even if India wins its battle against the deadly COVID-19 pandemic, the fight would be termed as a ‘Pyrrhic Victory’.
Pyrrhic Victory Explained
The phrase “Pyrrhic victory” alludes to the ancient Greek King Pyrrhus. After many casualties suffered by King Pyrrhus’ army in conquering the Romans in battle, he reportedly said, “If we win another such battle against the Romans, we will be completely lost.”
A pyrrhic victory occurs when the toll on the “winning” party does not offset the benefit of success. The term is applied as an analogy in politics, business, and sports to describe struggles that end up overthrowing the victory.
In the corporate world, pyrrhic victory sometimes happens in the courts. A judge rules in favour of one side because the expense of taking the case to trial often exceeds the winner’s monetary rewards.
This situation may arise when a smaller company complains a larger corporation with more funds and a legal team at its disposal. Even if the smaller business wins, the costs of a prolonged lawsuit will result in greater damages.
A Pyrrhic victory may also happen if the purchase price for conducting a hostile takeover is raised during negotiations. Alternatively, an acquired company may not live up to the anticipated returns from the acquiring company.
Real-world Examples of Pyrrhic Victory
Microsoft secured a Pyrrhic victory in its antitrust case in 2001 when an appeals court ruled the software pioneer should not be broken up. As a result of the case, however, Microsoft has been deemed a monopoly. As such, it has been subject to more harsh regulations in the future.
In 2011, Hank Greenberg, the former CEO of American International Group (AIG), filed a lawsuit against the U.S. government. It argued that the terms of the insurance company’s government bailout were stricter than those levied on other financial firms following the 2007-2008 financial crisis.
