Friday, April 10, 2015

Blind Businessman's Bluff

Ram Charan, The Attacker's Advantage: Turning Uncertainty into Breakthrough Opportunities

Authors and audiences alike have heckled me with names like Socialist, “an obvious Communist,” and “far-left” for my business book reviews. Not so. I keep agreeing to review business books because I have entrepreneurial aspirations, and I await the one that’ll mentor me through my planned shoestring start-up venture. And awaiting. And awaiting. Clearly I’m not done waiting yet.

Ram Charan worked his way from his family’s rural Delhi shoe store, through Harvard Business School, to the heights of corporate governance. Along the way, he recognized two categories of business uncertainty. There’s operational uncertainty, like markets and labor values, that you just live with. Then there’s structural uncertainty, the unpredictability that breaks weak leaders and makes strong ones. Charan wants to help you master and exploit structural uncertainty.

I realized I’d let myself in for a bumpy ride when I read this early quote: “The single greatest instrument of change… is the advancement of the mathematical tools called algorithms and their related sophisticated software.” I’ve become allergic to Taylorist command-control management, reinforced by mathematical controls. Anyway I presume that’s what Charan means, because he repeatedly uses the word “algorithm” thereafter without bothering to define it.

The Oxford English Dictionary defines an algorithm as “a procedure or set of rules used in calculation and problem-solving.” Venn diagrams and logic grids are algorithms. Presumably Charan intends calculus-based algorithms, of the type taught in MBA programs, but he never says so. This, unfortunately, epitomizes what reading this entire book is like: strings of bromides and professional buzzwords, opaque to those not initiated into today’s business tabernacle.

Ram Charan
Following this, Charan’s narrative becomes a laundry list of bromides so expansive, punch-drunk executives could make them mean anything they want. He anchors his declamation on platitudes like “Perceptual acuity,” “The ability to see a new path forward and commit to it,” and “Skill in making the organization steerable and agile.” No business professional would dispute these chestnuts. But ask five CEOs to define them, you’ll get five incompatible answers.

Charan makes sweeping pronouncements on how you (yes, you!) can run your business like Fortune 500 CEOs using Charan’s principles. But very few of his object lessons run longer than two paragraphs. He dedicates occasional short chapters to unpacking some corporation’s success, but he repeatedly relies upon their self-reported media and press releases. Charan essentially becomes others’ unpaid press agent and mythmaker.

One example struck me. He wonders why Sony, inventor of the Walkman, failed to anticipate the digital revolution and got blindsided by Apple. But I’ve read Duncan J. Watts. Apple’s iPod soared; Sony’s MiniDisc landed with a thud. Really, that’s emblematic of business today. Watts’ take-away: businessmen aren’t soothsayers. “Sony’s choices happened to be wrong while Apple’s happened to be right.”

Beyond all this, Charan is an inveterate name-dropper. He wants you to know he’s had drinks with everyone from Indian telecom maestro Vinod Kumar to former GE CEO Jack “the Layoff King” Welch. Consider just some of these self-congratulatory statements:
“In the early 1990s… I ran into [Jack] Welch on an elevator.”

“I was in a board meeting at Seagrams, which at the time owned Universal Music, the world’s largest music company, when Napster had just recently come onto the scene.”

“In May 2012 a director of Conoco Phillips discussed with me an issue he had been considering: whether to expand in India.”

“One day I was sitting at a lunch table during Microsoft’s yearly CEO Summit with Warren Buffett and eight other people.”
It doesn’t take many of these to realize, Ram Charan’s greatest business asset isn’t his acquired acumen. If you hire Ram Charan as your in-house management consultant, you gain access to Ram Charan. And you get one space closer to the entire Fortune 500 in the Kevin Bacon game.

Ram Charan offers the false promise that, should you merely adopt his simple stipulations, your business will run like the great world-changers that… um… imploded America’s economy in 2007. But what makes Charan’s prescriptions better than the hundreds of others coming from America’s business press this year? Watts again: “we can never be sure how much these explanations really explain, versus simply describe.”

Maybe I’m the problem. Maybe because I live in Flyover Country, and don’t hope to start the kind of business that’ll ever merge with Chinese corporations, these books talk past me. But I doubt it. I really think this showcase of meaningless bromides is essentially a billboard for Charan’s management consultancy. And I can do without that moonshine.

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