New Book Review: "The Strategy Paradox"
Recently posted book review for The Strategy Paradox: Why Committing to Success Leads to Failure (and What to Do About It), by Michael E. Raynor, Currency Doubleday, 2007, reposted here:
Raynor explains through several case studies that poor luck is usually the cause of company failure, not poor planning or execution. Any future strategy, according to the author's explanation of the Strategy Paradox, may fail because the future cannot be predicted: "strategies with the greatest possibility of success also have the greatest possibility of failure". Planning and executing well a strategy does not necessarily increase the chances of success. Instead, companies should hedge their bets by developing practical strategies based on multiple options that respond to the different requirements of several possible futures rather than commitments on singular strategies.
Raynor discusses his Strategic Flexibility framework that identifies uncertainties and develops the options needed to mitigate risk or exploit opportunity in light of Requisite Uncertainty: "since uncertainty increases with the time horizon under consideration, the basis for the allocation of decision making is the time horizon for which different levels of the hierarchy are responsible – the corporate office, responsible for the longest time horizon, must focus on managing uncertainty, while operating managers must focus on delivering on commitments".
While several case studies are presented, including those for Sony, Microsoft, Vivendi Universal, Johnson & Johnson, and AT&T, Raynor returns to the case studies of Betamax and MiniDisc repeatedly throughout this book, so even though the material presented is rather convincing, it seems odd that if Requisite Uncertainty is indeed such a universal phenomena there are not more than a handful of associated case studies.
Interestingly enough, in the opinion of this reviewer, the best portions of this book are the beginning and ending of each chapter, the three appendixes (although these are lightweight and candidates for separate books in themselves), and the end notes to each chapter. For example, the third chapter explains the dilemma firms face in the light of extreme positioning, often leading to accepting lower returns for a better chance of survival, and the five pages of end notes provide interesting thought points, but the bulk of the body of that chapter could easily be trimmed down. The substantive portions of this work are best suited for a white paper, so any more than a couple hours of casual reading is more than enough reader investment (even though this reviewer continues to read all texts in their entirety prior to posting reviews).