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It's an all too common scenario: A great
company breaks from the pack; the analysts are in love,
the smiling CEO appears on the cover of BusinessWeek
and Fortune, the stock explodes. Employees, stockholders,
vendors, and customers are happy.
Two years later, the company is in flames,
the pension plan is bleeding, the CEO is under attack --
or even indictment -- and the stock is worthless.
We're suffering an epidemic of leadership
failure. How can this vicious cycle be broken? How do you
know if your company is vulnerable? How can investors and
managers reduce the likelihood of being disappointed by
a company's performance?
In Why Smart Executives Fail, Sydney
Finkelstein unveils the extraordinary results of the largest
research project ever devoted to leadership failure. Over
the past six years, Professor Finkelstein and his team conducted
hundreds of interviews with insiders at top companies that
have risen and fallen -- and, for some, risen again -- to
expose the root of these failures and to gain insight into
the people behind them. One astonishing finding: Businesses
that seemed to have nothing in common turned out to have
failed for exactly the same reasons. Even the excuses that
failed managers offered turned out to be the same in case
after case.
In the end, despite all that could go wrong
for a company, the real fiascos can be blamed on surprisingly
few causes. And they're not the ones you might think, like
ineptitude or greed. Rather, top executives confront failure
when they:
- Choose not to cope with innovation and
change
- Misread the competition
- Brilliantly fulfill the wrong vision
- Cling to an inaccurate view of reality
- Ignore vital information
- Identify too closely with the company
This fascinating in-depth study offers an
unprecedented inside look into what kinds of mistakes can
bring a great company -- such as GM, Mattel, Motorola, Rite
Aid, Quaker, Saatchi and Saatchi, and Webvan, to name but
a few -- to the brink of collapse. As much an engrossing
story about people as it is about business, Why Smart
Executives Fail will be the first time many of these
managers and executives speak out about what really happened
when the decisions were made that sealed their companies'
fate and what they would do differently now if they could.
As timely as today's headlines, Why Smart
Executives Fail is a truly indispensable, practical,
must-read book for anyone intent on avoiding the executive
mistakes so many have made in recent business history.
Sydney Finkelstein is Steven Roth Professor
of Management at Dartmouth's Tuck School of Business. His
writing has appeared in the Harvard Business Review
and other business journals. He lives in Hanover, New Hampshire.
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