Only the Paranoid Survive

Only the Paranoid Survive➷ [Reading] ➹ Only the Paranoid Survive By Andrew S. Grove ➬ – Massive change is hitting corporate America at a furious and escalating pace writes Andrew Grove in Only the Paranoid Survive and businesses that strive hard to keep abreast of the transition will be Massive change is hitting corporate America at a furious and escalating pace writes Andrew Grove in Only the Paranoid Survive and businesses that strive hard to keep abreast of the transition will be the only ones that prevail And Grove should know As chief executive of Intel he wrestled with one of the business world's great challenges in when a flaw in his company's new cornerstone product the Pentium processor grew into a front page controversy that seriously threatened its future. I picked this book because it was referred by Ben Horowitz Other reason being the book's interesting title which somehow conveyed to me that it must be a book about how Andy Grove was paranoid in good sense enough to make Intel an Awesome companyBut as soon as started the book I become disappointed because it's not the book I thought it to be Its not about Andy Grove being tough CEO or his paranoid decisions It's is just like any other common business book written by a High profile CEOBook is all about Strategic Inflection Point that in simple language means any BIG turn of events in your company or your industry or technology like Intel ditched Memory business the business it started with and moved to microprocessors business Book doesn't give any practical tips or secret sauce to handle these big turn of events Nothing at all It's like slog it through brainstorm with your team decisions can be tough you need to take your team with you etc etc But you would have read all those in 100s of blogs previouslyThere are few interesting chunks in the book1 CxOs or senior management team are always 'last to know' guys They get bad news very very late This is so true I totally agree to this Your middle management will filter the infonews before presenting it to you and nearly all the times they will present datastory in a format so that they look smart tough intelligent and proactive No one wants to tell the bad news Create a culture in your teamcompany so that people are open to you or their supervisors without any inhibition of being reprimandedjokedignored or given a look like it's above your pay grade dude Create an open and transparent culture Be open to healthy arguments in fact encourage healthy arguments This culture can't be created in days or months it will take years but it'll be worth it2 People even competent highly intelligent serious minded people can come to different set of conclusions about a given set of facts For ex IBM and Intel went two different ways on using X Ray to define feature of a chip So nothing is Right or Wrong Iterate and Iterate as fast as you can Fast iteration is better than slower ualitative iterationAnother thing that i realized while reading this book is Why am I reading this book? I am a wannabe entrepreneur and this book is about Billion Dollars Big Critical decisions It by no means immediately benefit me This 'might' be helpful for senior management guys but for everyone else just give it a pass Inflection The strategies and decisions and luck Intel embraced are remarkable and to cover them all in detail in a short book would have been impossible The fundamental essence of this book is that the only constant we can expect in business is CHANGE How do we anticipate it? How do we prepare for that point where we either change or die? The ones we sometimes see coming and the ones we don’t That Inflection Point Can we recognise or anticipate change or do we create processes that enable us to rapidly respond once the change is obvious? For well established market leaders that fail this is typically why History is littered with huge multi national companies that failed to see the change and respond effectively they don't exist any Intel was nearly one of those companies but this book provides very interesting insight and the remarkable thinking that existed within Intel at the time to deal with the pivot necessary to save their businessThe book is written with the flow of a story which helps it resonate well It also reminds us that many decisions involve agonising analysis and reasoning and are extremely personal The book is full of Grove’s war stories which are really interesting and relevant as we lived through many of these events A good point that I remember from the book is when Andrew Grove recollects his darkest moment 'when he realised that not only were the Japanese cheaper in manufacturing memory chips but their uality levels were at levels that Intel didn’t even think possible' Intel’s move away from memory to microprocessors was traumatic and the inflection “point” was not so much a point as a long drawn out and painful affair The backdrop to that inflection point and other points make this book a great learning experienceI love the term and the concept Only the Paranoid Survive which in business keeps us on our toes worrying about that change which is inevitably coming This is a short easy read that I would recommend Today Andy Grove died at the age of 79 His book Only the Paranoid Survive talks about his key business philosophy One should always be on the lookout for new trends or products that might displace or destroy yours Under him Intel was famous for cannibilizing their older chips their cash cows with the new ones The competition just couldn't follow their relentless pace I recommend the book to everyone in management or business whether in high tech or not Only The Paranoid SurviveKey uotesThe replacement of corporate heads is far motivated by the need to bring in someone who is not invested in the past than to get somebody who is a better leader or better manager in other ways Andy Grove Only the Paranoid Survive p127Strategic change doesn't just start at the top it starts with your calendar p146Put all of your eggs in one basket then WATCH THAT BASKET Mark TwainAsk yourself'Will going to this meeting teach me about the new technology or the new market that I think is very important now?''Will it introduce me to people who can help me in the new direction?''Will it send a message about the importance of the new direction?'If so go to it If not resist it p154Great leadership during change starts by letting chaos reign debate then when the time is right reign in the chaos determined march This dynamic dialectic is a must p161The best part of Andy Grove's book might be the title Only the Paranoid Survive Large organizations often fail because they don't adapt fast enough There are two types of forces that organizations run into 1x forces which fall within the normal actionreaction that people and organizations are easily able to adjust to However there are also 10x forces that fundamentally change the rules and most people and most organizations fail to adapt to these fundamental changes uickly enoughFor example think of these changes as waves in the ocean The wave may come from any direction but all are manageable However occasionally there is a tidal wave which you can detect and respond properly to but that response is fundamentally different than the way you respond to a normal 1x waveIn Intel's case they faced 10x forces twice1 Intel started in the RAM business Japanese factories caught up with them The Japanese had lower cost structures and higher volumes and government support they sucked all of the profit out of the RAM business and ultimately took Intel's market share Intel managed the transition by moving from a RAM company to a CPU company2 Customers boycotting Intel CPUs Intel never thought of end customers as their customers because they didn't sell direct to the end customers However they started branding their CPUs and asked manufacturers to put an Intel Inside logo on computers that used Intel CPUs When they ran into small manufacturing problems and didn't take massive steps to correct those problems their end consumers felt that Intel was taking advantage of them and therefore started boycotting their chips Intel took massive losses but eventually recognized they needed to service both end consumers and their normal manufacturer customersAccording to Andy there are 6 areas where theses 1x and 10x forces can start1 Competition Ex Your a mom pop shop when wall mart comes to town2 Technology Ex Sound takes over silent films Containers overtake shipping of loose items PC revolution3 Customers Changing taste in FordGM cars Attitude shifts Super computers4 Suppliers Airlines vs Travel Agents Second Sourcing in the tech component business5 Complementors 6 Regulation Patent Medicines Telecommunication Privatization EPAFinally Grove cautions us to always remain aware Your business will fundamentally be hit by 10x changes It's just a uestion of WHEN and HOW YOU RESPOND to those changes The earlier and accurately you identify 10x changes the freedom you have to choose your response because your original business will provide the resources to jump start the new business As you go through the transition you should let go of the system and learn from the people below you Andy says To Let Chaos Reign But once you have all the information you need to properly identify the new business typically including completed marketing completed testing then you must take control Reign in the Chaos and uickly complete the transition to the new business model Andy Grove then CEO of Intel Corp is clearly worth listening to on the subject of management The Wintel success story is well known More harrowing was Intel's earlier self transformation from making memory chips to making microprocessorsHow to steer an enterprise thru a major change in its business per Mr Grove 1 Figure out if a major change is imminent If so you're about to enter what Grove calls the valley of death2 Figure out how to deal with it Largely for CEOs this involves listening to your employees doing your homework3 Set a new course sell it to your company and stick to itThe secret to success here is identifying the oncoming crisis early reacting sensibly He relates the story of Apple a company with clearly superior products the Mac operating system the first good laser printer completely missing the shift from proprietary to open PC standards and ending up as a niche player John Sculley then Apple's CEO acknowledged this crucial mistake years later Groves thinks Sculley knew this shift was happening but wasn't able to overcome Apple's inertia of success Curiously this was pretty much the same problem IBM had when PCs began displacing mainframes It's very hard for an organization to give up a strategy that has been richly rewarded in the pastIn management as in engineering we often learn from failures than successes Grove's case histories will make informative reading for anyone in business Not many of us are CEOs but we'll all go thru Grove's strategic inflection points in our careersReview written 1998 In the business books category this one ranks high Grove asks a fundamental uestion how do companies die or survive a strategic inflection point? Translation how do they survive when a 10x change hits their business and there are only two trajectories exponential growth or rapid decline to zero There are never clear answers to any such uestions But there are processes One must constantly ask whether changes that are happening are 10x changes or standard business procedure Is it noise or a signal? Constant communication in between employees is crucial as well generally the top management is the last to realize that changes are anew since they are not the ones on the battleground That point may have changed since the 90s as data exchange was not as fluent back then Nonetheless employees who talk to customers on a daily basis have the type of information that top management will never haveOnce a 10x change is detected action must be clear and instant Grove highlights how oftentimes managers who are at strategic inflection points spend their time going to conferences writing books doing charity In other words doing all types of other things so that they would not have to deal with the most difficult task they will face during their time as CEOI can't help but delve into current affairs as well Ever since Covid 19 started spreading in the Western world I have been thinking about the title of this book uite often Had world leaders and people in general been a bit paranoid some carnage would have been circumvented This book discusses some really important ideas primarily the 10x forces that fundamentally change businesses and the strategic inflection points during which an industry is transformed by these 10x forces yes he uotes that term everywhere it appears in the book Grove explores these ideas using his experience as CEO during Intel's switch from making memories to making microprocessors in the late 80's as the primary example but he emphasizes that these ideas are not uniue to the tech industry and also explores SIPs in other industries ranging from sound in the movie industry to Wal Mart in retail After explaining these concepts and pointing to that range of examples the author spends most of the book discussing how to manage companies during these crises how to know that you're in the middle of a SIP how to separate signal from noise during that confusing period and the importance of fostering healthy debate but subseuently projecting decisive leadershipThe material covered in this book is important for anyone in business and I mostly agreed with the author's high level ideas but I was disappointed by the book itself The case study of Intel was fascinating especially hearing it told from the man in charge at the time But much of the advice was either obvious or overly simplistic For an obvious example take the idea of listening to what your sales people and individual contributors on the ground are telling you about how their jobs are changing This seems like something managers should always be doing It could be one of those things that sounds obvious when you say it but isn't something you think about when you're in that position Or maybe I'm unusually aware of these ideas because the book is 15 years old now or because I've been lucky to work for engineering driven companies that were well aware of these ideas and socialized them uite likely the approach just didn't resonate with me because the book is targeted at middle and senior managers not individual contributorsThe Reign in Chaos chapter that describes setting strong direction after a period of open debate had some particularly condescending passages On page 145 Grove counsels managers that admitting that you need to learn something new is always difficult It is even harder if you are a senior manager who is accustomed to the automatic deference which people accord you owning to your position But if you don't fight it that very deference may become a wall that isolates you from learning new things It all takes self discipline That's right it's tough as a senior manager to avoid completely ignoring the ideas of your subordinates but you can do it with a little bit of self discipline Next time one of your reports has something to say and you just want to send them back to the salt mine consider listening insteadOn page 163 there's the story of a very competent senior manager at Intel who had some great ideas but according to Grove just went about them poorly He organized a committeeto investigate an issue and come up with a recommendation It turned out that this manager knew all along what he wanted to do but instead of giving that direction to the committee which he could have he was hoping to engineer a bottom up decision to the same effect When the committee came up with the opposite recommendation he felt cornered At this late stage he tried to dictate his solution to people who by now had spent months struggling with an issue and had firmed up their minds It just couldn't be done Coming as it did at this late stage his dictate seemed utterly arbitrary Yes telling a committee of your reports that the results of their lengthy discussions are all wrong and you're going to do the opposite because you think it's better just seems arbitrary And I guess the lesson to managers is don't ask your reports to think about what to do because they'll just come up with the wrong answer and be angry when you set them straightDespite these parts and the overall lackluster presentation these ideas are pretty important and the author's obviously considered them a lot One last thing the book's a bit old now written in 1996 and predates things like the Internet's explosive growth but to the author's credit in several cases he accurately forecast industry transforming changes including the Internet's disruption of the travel booking industry and the difficulty that faces music movie and software companies in a world where people can download media through the Internet The last chapter covers The Internet entirely and basically asks fad or the biggest innovation of the century he comes down on the right side but with our hindsight it makes for some interesting reading 255 I was thinking to give it 22 But since the book dates back at 1998 I see some of Grove's prediction has come true by this time I think 25 is enoughMy favorite moment from the book is when Gordon Moore Grove decides to get rid of the memory business at Intel in the face of an inflection point by Japanese manufacturers This reminds me most often we hold the key to put a stop to our misery but we barely notice that I appreciate Grove's approach to introduce various inflection points in the business from his experience at Intel But the book is not so well written Grove surely knows what he has to offer but couldn't match that expectation with his writing The details of the examples are inadeuate still too short to be sufficient Many characters are kept anonymous criticisms are blunt I guess he took safe side May be he didn't want to piss off many people Recently I finished Steve Jobs' biography I see he's not that open to Steve's support for vertical platform And I see he's praising Sculley 3Okay I feel if this book have any new edition Steve Jobs must have his rightful distinguished place since he revolutionized Apple after his return at 1997 I had heard so much about this book being a classic and I finally read itWhats lovely is that it was written in 1996 and he lays out the principles of how to prepare for deal with and manage change especially when it comes to a change in how the business worksWhen industries structures networks change it can ruin organisations or catapult them to dominant positions It is also a signal to either scale up in that direction or retreat completely out of the current oneIt's also a brilliant reason why value investors hate businesses that are prone to significant changes because then one has to rely on management prowess to be able to change and that tends to be unpredictableBrilliant book Last 2 chapters got boring but some stories and examples are brilliant A absolute must read for every serious entrepreneur I wish to become as good leader and entrepreneur as he was This book does not only touch a very interesting topic that mean life or death for enterprises but adding the fact that the book was written in the nineties it's very interesting to see a world class CEOs view on the potential changes Internet will bring from our perspective in the year 2016