Only the Paranoid Survive - Deepstash

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Only The Paranoid Survive

Andrew Grove, former CEO of Intel, has a model that can help companies not only to deal with critical moments in their existence but also use them to thrive.

Intel’s CEO, Andy Grove, calls these moments “strategic inflection points” or SIPs. He presents advice for surviving and thriving in these critical times.

Key points:

• It’s not always a good idea to keep secrets.

• Open communication with outsiders is important.

• A company shouldn’t trust the opinion of someone who feels emotionally attached to it.

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Strategic Inflection Points

A strategic inflection point(SIP) is when the balance of forces shifts from the old structure, from the old ways of doing business, from the old ways of competing, to the new.” In other words, a strategic inflection point brings on a significant change of fundamentals, which it’s hard to fully plan for, formally at least. This doesn’t mean that one shouldn’t plan, but that we should look at ways in which we, our teams and our businesses can best respond to change.

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Success Inertia

The late author warns against the ‘inertia of success’ and encourages readers to expose themselves to the winds of change and to do so constantly. His point is that strategic inflection isn’t a point; it’s a long, torturous struggle in which we’ll have to manage the chaos. 

To do this, the leader has to:

  • Let it reign – “Resolution comes through experimentation. Only stepping out of the old ruts will bring new insights.” 
  • Rein it in – Clarity of direction, which includes describing what we’re going after, is exceedingly important at the late stage of the strategic transformation

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The IBM Example

IBM was greatly affected by how their computers were built because they used to sell pre-built computers but then people could combine components like microchips, hard drive software etc., so now consumers preferred designing their own PCs instead of buying pre-made ones from IBM

Although IBM tried to develop PCs for the masses, they were too late and failed. The market had already gone to other companies who sold computers with better technology.

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How CEOs and Employees Need to Respond To Strategic Inflection Points

SIPs are not just relevant to CEOs. Rather, they affect all employees at every level of a company. That’s why everyone should be prepared for such situations because jobs can be lost when SIPs occur. In extreme cases, a SIP could even result in the entire business shutting down and thus causing every employee to lose their job.

For example, when sound was first introduced into movies, actors were forced to choose whether they wanted to stick with silent films or adapt to the new. Some adapted and became successful movie stars; others failed because they didn’t adapt well enough.

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CURATED BY

melissamartinez

Passenger transport manager

The Late Andy Grove talks about managing change in this classic leadership book.

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