Why Smart Executives Fail: And What You Can Learn from Their Mistakes

Like all my friends, I have a business degree. We thought we were going to set the world on fire. What we ran into were senior managers who didn't have a clue about the very company they worked for. A good interview is at www.firstvoicebooks.com/finkelstein.html When I read this book, I laughed so hard I dropped the book. Most people won't have that strong a reaction. But for those of us who were taught that the guys at the top were the smart ones, it hits the nail on the head. The author is very organized, descrete and professional. It's a good book to read to learn from others' mistakes.

I was stunned by this book. As a successful executive who reads several business books a year, I am usually disappointed by both the ideas and the writing style of most writers-especially strategy professors. Professor Finkelstein's book is the exception. It is beautifully written; has excellent examples based on REAL RESEARCH; offers ways to avoid making mistakes yourself; and it comes at just the right time for those of us running large organizations. Bravo, Professor!

As a MBA and manager, I've been reading business books for years, and we all know what that can be like. Weak research, spotty stories, stilted prose. When I picked up Why Smart Executives Fail (don't judge a book by its cover, but this cover is great), it seemed like I was entering a different genre. The writing is highly entertaining, the stories are fascinating, and the author's (Finkelstein is a b-school prof from Dartmouth) insights are nuanced and carefully drawn. It's hard to imagine a business book being a page-turner, but this one is as close as I've ever seen. All the front page stories are here - Enron, Tyco, ImClone, Adelphia, WorldCom, but there is also a host of companies whose crimes were more strategic in nature - Motorola in the cell phone business, J & J in the stent business, Rubbermaid, LA Gear, and even the Boston Red Sox. The stories of what went wrong and why are sprinkled with quotes from interviews the author conducted with CEOs, other managers, competitors, and customers, which I found gave me a much better understanding of the key lessons than any previous press accounts I had read. Topping it all off is the author's storytelling skills, which keep you almost entranced. This is one business book that you will want to read cover to cover.

Initially, Finkelstein really didn't understand, nor did I before reading his book, how and why can so many business leaders fall so far so fast. "How can so many people be do disastrously wrong? What can possibly account for the scores of business failures we see each year, in different industries, and even in different countries? And how can we prevent this sort of thing from happening again?" Finkelstein devoted more than six years of research to answering questions such as these. "My goal was not only to understand why businesses break down and fail, but to focus on the people behind these failures; not only to understand how to avoid these disasters, but to anticipate the early warning signs of failure. Ultimately, I wanted to move beyond ad hoc explanations of failure on a case-by-case basis and expose the roots of these breakdowns in a definitive way." Whereas Peters and Waterman set out in search of excellence, Finkelstein and his research associates set out in search of failure...and achieved that objective. What they found and what they learned are now offered in this brilliant book. He organizes his material within three Parts: Great Corporate Mistakes, focusing on four different business challenges: creating successful new ventures, managing mergers and acquisitions, coping with innovation and change, and developing winning strategies in the face of new competitive pressures. In Part II, he identifies the underlying causes of failure evident even across different types of corporate mistakes. In this Part, Finkelstein offers a deeper analysis of the common patterns of behavior that executives in failing companies exhibited. In Part III, Finkelstein shifts his (and his reader's) attention to explicitly developing two critical ideas that have stayed in the background to this point. "First, can we use the findings of our study as an early warning system? Can our results tell us how to predict when troubler is coming? And second, how do successful executives create organizations that can learn from, and better yet avoid disaster? What can we learn fro them?"Almost everything of any significant value I have learned in my life thus far has been the result of personal experience. And almost everything of value I have learned from that experience involved a failure of some kind. Hence the great importance of this book which examines dozens of "smart executives" who failed. They include Jill Barred at Mattel, Dennis Kozlowski at Tyco, Jean Marie Messier at Vivendi, Robert Pitman at AOL Time Warner, and Wolfgang Schmitt at Rubbermaid. Indeed, the research for this book devoted rigorous attention to senior level executives in 51 different companies of various sizes and nature. Where did even the brightest executives go wrong? What can we learn from their mistakes? How can we avoid repeating those mistakes in the future? In essence, that is what this book is really all about.Long ago, someone made a clever observation that Russian historians al

Someone said, and I believe, that "Success is the result of a series of failures from which one has learned." This book is filled with important and interesting failures that you can learn from. Most business books focus on and celebrate successes in the business world, but here the author has focused on some of the largest blunders in recent history (e.g. Enron, Iridium), as well as lesser known mistakes. What makes it so valuable is that Finkelstein has taken a systematic approach to analyzing these missteps to find patterns that will be recognizable to anyone who has worked in a business. Beyond that, the book offers excellent insight on ways to get back on track and avoid a fate similar to the companies studied.As for the enjoyable part, the book is told through a series of anecdotes and in-depth retellings of mostly familiar blunders. Reinforced with insider interviews and extensive research of the contemporary media coverage, these stories come alive making it very readable. This combination of message and method make "Why Smart Executives Fail" an extremely valuable and somewhat unique resource.