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 | Compulsory Text in our Management Degree program

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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 35 reviews view larger image
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highly recommended

A compelling vision. Bold leadership. Decisive action. Unfortunately, these prerequisites of success are almost always the ingredients of failure, too. In fact, most managers seeking to maximize their chances for glory are often unwittingly setting themselves up for ruin. The sad truth is that most companies have left their futures almost entirely to chance, and don?t even realize it. The reason? Managers feel they must make choices with far-reaching consequences today, but must base those choices on assumptions about a future they cannot predict. It is this collision between commitment and uncertainty that creates THE STRATEGY PARADOX.

This paradox sets up a ubiquitous but little-understood tradeoff. Because managers feel they must base their strategies on assumptions about an unknown future, the more ambitious of them hope their guesses will be right ? or that they can somehow adapt to the turbulence that will arise. In fact, only a small number of lucky daredevils prosper, while many more unfortunate, but no less capable managers find themselves at the helms of sinking ships. Realizing this, even if only intuitively, most managers shy away from the bold commitments that success seems to demand, choosing instead timid, unremarkable strategies, sacrificing any chance at greatness for a better chance at mere survival.

Michael E. Raynor, coauthor of the bestselling The Innovator's Solution, explains how leaders can break this tradeoff and achieve results historically reserved for the fortunate few even as they reduce the risks they must accept in the pursuit of success. In the cutthroat world of competitive strategy, this is as close as you can come to getting something for nothing.

Drawing on leading-edge scholarship and extensive original research, Raynor?s revolutionary principle of Requisite Uncertainty yields a clutch of critical, counter-intuitive findings. Among them:

-- The Board should not evaluate the CEO based on the company?s performance, but instead on the firm?s strategic risk profile
-- The CEO should not drive results, but manage uncertainty
-- Business unit leaders should not focus on execution, but on making strategic choices
-- Line managers should not worry about strategic risk, but devote themselves to delivering on commitments

With detailed case studies of success and failure at Sony, Microsoft, Vivendi Universal, Johnson & Johnson, AT&T and other major companies in industries from financial services to energy, Raynor presents a concrete framework for strategic action that allows companies to seize today?s opportunities while simultaneously preparing for tomorrow?s promise.

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Requisite uncertainty and human capabilities

Zachary Stein ((Harvard Graduate School of Education) & Theo L. Dawson (Developmental Testing Service)

We agree with many of the other reviewers of this book. It combines high quality scholarship and accessibility, making it stand out from most of the popular leadership literature. But we think most of the other reviews have missed a key dimension of Raynor's model, a facet of his vision that sets it apart from the more traditional literature on strategies and organizations. With a nod to the research of Elliot Jaques, Raynor makes it clear that the proposed model of "requisite uncertainty" would have us build organizations that are sensitive both to the demands of the marketplace and the realities of human capabilities. We all know that organizations need to be responsive to socio-economic trends and uncertainties, but only a select few are privy to the notion that organizational hierarchies need to be designed in light of facts about human cognition and cognitive development. In our minds, this latter point is what sets the "Strategy Paradox" apart.

Individuals occupying different roles are faced with different demands. This we all know. But Raynor helps to clarify just who should be doing what, and moreover, what those at the top need to do to handle the unprecedented uncertainties of post-modern socio-economic conditions. As Raynor explains, these high-level demands cash out in terms of dialogically rich inquiry-based procedures for "crystallizing and preserving a diversity of opinions" regarding strategic options. Needless to say, that's a tall order that not just anybody can fill. What's preferable is not always possible. Our only criticism is that Raynor has too little to say about the cognitive capabilities that would make his vision possible. There is a rich literature about adult cognitive development and its measurement that Raynor does an inadequate job of referencing. Jaques and Kegan are the tip of a very complex iceberg. And frankly it's an iceberg that might sink this ship.

From where we sit, the model is incomplete without further consideration of the cognitive demands of "Strategic Flexibility." Any life-span cognitive developmental psychologist will tell you that less than 3% of the adult population in the developed world has the cognitive skills to meet these demands. We don't mean to rain on the parade, but for this model to work we need to ensure that those who engage in the highest levels of strategic planning are equipped with the requisite cognitive and discourse skills. Without them, real-world implementations will be less than stellar.

To sum up, our reading of the "Strategy Paradox" reveals a devil in the details. We think that Raynor's radical suggestions regarding human capabilities and organizational strata are the trend-setting elements of his model. Zeroing in on these suggestions exposes a formidable challenge.

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Compulsory Text in our Management Degree program

The Strategy Paradox is now a compulsory text in our Management Degree program. Why? It exemplies the critical importance of sharpening innovative thinking into strategic direction, borrowing from his work at Harvard focusing on disruptive technologies and innovation into his thinking on approaches to overall strategy formulation and execution.

The lessons learned are somewhat counter intuitive but Raynor presents strong evidence to support why traditional strategic axioms may be flawed. He offers unique perspectives on strategy, including;
- The CEO should not drive results, but manage uncertainty
- The Board should not evaluate the CEO based on the company's performance, but instead on the firm's strategic risk profile
- Business unit leaders should not focus on execution, but on making strategic choices
- Line managers should not worry about strategic risk, but devote themselves to delivering on commitments

These are not just business lessons but life lessons. Our students must have an awareness of the strategic fundmentals of managing risks & reward, using evidence, insight and in being transparent in communicating assumptions. As in one's personal life, as in one's professional life, over the long term, the ability to effectively manage the the myriad of risk / reward tradeoffs most often finishes on top.

There are few lessons that a business school can teach that have more lasting life impacts, and that is why this book is a must read.

Dean, JR Shaw School of Business

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HIghly readable

Dont know why my review of it sent to Amazon near end June had not been posted and so I got to rewrite a brief once again for my own record.

In short, a well written HBR type book not to be missed by any top management or strategist in conglomerates. Highly recommended.

Very good ideas, writing style somewhat longdrawn

The theory (paradox) presented in the book is well-thought and substantiated by research and the author presents organisational solutions and tools to address the challenge.

The paradox itself is different from other contemporary management books. The writing style is though a bit extensive and somewhat long-drawn for my liking but perhaps that is a personal taste.

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

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