The Strategy Paradox: Why committing to success leads to failure (and what to do about it) |...

The Strategy Paradox: Why committing to success leads to failure (and what to do about it) | Michael E. Raynor | Good stuff

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The Strategy Parad...

	The Strategy Paradox: Why committing to success leads to failure (and what to do about it) Michael E. Raynor Doubleday Business, 2007 - 320 pages average customer review:based on 36 reviews view larger image
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highly recommended

An important book on strategy; a "must " read

Assessment
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As a Contributing Editor to Strategy and Leadership magazine, I read a lot of strategy books. This is an excellent book, well worth reading. It's a must addition to the library of anyone interested in strategy. It's particularly useful for executives dealing with uncertain markets.

Strategy is a relatively new field. Many books and ideas in strategy are ill thought out and not useful. In contrast, Michael Raynor's new book is well written, insightful and useful. It is particularly useful for companies in industries that have high degrees of uncertainty.

Perhaps most importantly, unlike many books on strategy, it will cause management teams to rethink how they develop and manage strategy.

The Author
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Michael Raynor's last book, The Innovator's Solution is the best of the three books on disruptive strategy that have been authored by the lead author, Harvard Business School professor, Clayton Christiensen.

The Subject
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Raynor's strategy paradox is that companies that execute strategies may, by virtue of their commitment to their strategy, experience strategic failure. The example of Sony with Betamax and disc players is used illustrate new insights into these familiar cases of product failure.

This core idea is a fascinating extension to the core idea in The Innovator's Solution where Christiensen and Raynor argue the well managed companies will often overlook disruptive strategies being pursued by new companies with initially inferior products. The different business models required for the successful and emerging disruptive strategy may not be manageable by the same team.

Raynor's book addresses the issue of how should companies avoid overconfidence in their ability to develop strategies and implement in an uncertain environment. In brief, his prescription is to (1) explicitly manage the commitments to a strategy and (2) simultaneously manage the uncertainty around the strategy. The consequences of his prescription are important because they affect how organizations should view the role of executive and operating management.

His prescriptions for portfolio management are based indirectly upon options theory, and illustrated by examples from Sony, Vivendi, Johnson

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Good stuff

Raynor takes a complex issue - developing strategy in the face of an uncertain future - and gives practical advice we can actually use. And it's not just your good-to-great mumbo-jumbo. He looks at how smart companies can make bad decisions by behaving as though they know more than they really do about the future.

My favorite part of the book is Raynor's take on organizational structuring. He gives a detailed analysis of which organizational levels should be engaged in what parts of strategic decision-making. It made good sense to me, even though most companies don't appear to be aligned in the manner he recommends. Maybe that'll change as more people read this book.

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Not your usual business book

Great book, impeccably researched and very logically written. Likely to be appreciated by readers who are willing to really think about Business and the root cause of high performance. On reading the book, seemed to me that Dr Raynor has added a third dimension to great business thinking - first was Porter who describes profitability and competition, next was Christensen who described the lifecycle through disruption and now Raynor who adds risk and the role of corporate strategy. Dr Raynor makes the point that high returns come with a price - higher risk - and that demanding higher returns means that someone has to take into account this higher risk. Really excellent case study of how Johnson and Johnson has managed this balance; should be read by all life sciences professionals.

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Requisite Uncertainty and Strategic Flexibility

The phrases listed in the title of this review will be spoken in business schools for decades. The Strategy Paradox is an excellent read. Thorough. Insightful. Researched. Raynor's approach to risk and return, and his application of this traditional financial term to strategy, is eye-opening. The best feature of this book, however, is the tool set you may use to manage an uncertain future.

reviews: 1, 2, 3, 4, 5, 6, page 7, 8

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