The Limits of Strategy

1992 was a killing year for the four
computer companies most important to business buyers over
the decade. All four had been dominant suppliers of
minicomputers for the past fifteen or twenty years. But on
July 16, the CEOs of both Digital Equipment and Hewlett
Packard were pushed into retirement. On August 8, Wang
Laboratories declared bankruptcy. In December, IBM halved
its dividend for the first time ever, forcing the
resignation of its CEO a month later. How did this happen?
All four CEOs were clever and experienced. Two were founders
of their companies; the other two highly successful career
executives in their respective companies. All four were
simply overwhelmed. And while there was no single
explanation for what happened, there were definite common
themes. They recur again and again in the many stories of
this book. Are the deadliest changes unavoidable because
strategy is too easily thwarted by cluster bombs like
technological velocity, cultural inertia, obsolete business
models, executive conflict, and investor expectations? The
year 1992 is the fulcrum of this book, but the underlying
theme is company transitions in the face of massive changes
in markets, technologies, or business models - or, in other
words, the limits of strategy.