Book Reviews: Good to Great, Creative Destruction
Good to Great first. This book will (probably) terrify you if you work. Clearly outlining critical characteristics of super-successful companies it show over and over again why most companies are not. Think about where you work, and how you invest, in the light of what the authors discuss. Like Execution, another book I really liked (and reviewed here), it analyzes how companies that sustain a high level of effectiveness might do that and gives some practical advice you can follow, whether or not you are the CEO. In addition this book is highly recommended for anyone thinking about becoming a CEO or engaged in a CEO search.
Unfortunately the same cannot be said of Foster and Kaplan's book "Creative Destruction: Why Companies That Are Built to Last Underperform the Market - and How to Successfully Transform Them". The book starts of reasonably well. Its general themes explaining why large companies tend to behave in ways that make them less effective at responding to change than the market are well described. As the book tries to show examples of companies that did or did not respond well to the forces of change in business they lose their way. Not only do they extol a number of companies seemingly purely because they were founded by friends from McKinsey, they also use Enron as a successful example! Too many of their examples have not done well since the book was published and that undermines their message. The book also lacks concrete advice, though I must confess to skimming towards the end. My takeaway? The market as a whole will ALWAYS innovate more effectively than any company so get over it and be prepared for companies to come and go and change constantly. There's not much, if anything, you can do about it. The book should have been subtitled "Why Companies Underperform the Market in the Long Run" as that's really what it comes down to.