Customer Reviews

Chaotics: The Business of Managing and Marketing in the Age of Turbulence

5 star:		(9)
4 star:		(4)
3 star:		(3)
2 star:		(0)
1 star:		(0)

 

 

According to Philip Kotler and John Caslione, today's business leaders need "a new view of the world and a new framework for dealing with it...a systems to make better decisions. They need a managerial framework and system to deal with chaos. They need a Chaotics Management System." In the Introduction, Kotler and Caslione note that business leaders "sense that we've entered an era of ongoing, continuous turbulence and heightened chaos. This realization is often accompanied by a sense of relief that they can now articulate what they've been sensing, coupled with dread that the traditional up cycle may not kick in to let the good times roll again - at least not like it did in the past. It is for this reason that we wrote Chaotics." These remarks reminded me of Andrew Grove's assertion that "only the paranoid survive" because, even when - especially when - the "good times" are rolling, they sustain a sense of "dread" that keeps them ever-alert to potential as well as obvious threats. In their book, Kotler and Caslione do not suggest that The Age of Turbulence is merely imminent. It is already here and all organizations are now subjected to its "unpredictable and uncertain waters" in their competitive marketplace, and their leaders must somehow "navigate" them through the turbulence while achieving Business Enterprise Sustainability (BES).

The material is carefully organized within eight chapters. First, review the main causes of turbulence, then shift their attention to the sequence of eight steps of the chaotics implementation cycle that will enable business leaders to navigate "the unpredictable and uncertain waters of disruptive turbulence in what they characterize as the "Age of Turbulence":

1. Identify sources of turbulence and chaos
2. Identify management's wrong responses to turbulence
3. Establish early-warning systems
4. Construct key scenarios and strategies
5. Prioritize key scenarios and select strategy
6. Implement chaotics strategic management behaviors
7. Implement chaotics strategic marketing behaviors
8. Achieve business enterprise sustainability

Kotler and Caslione note that Clayton Christensen introduced the term "disruptive technology" in an article published by the Harvard Business Review and later developed this concept in much greater depth in a book, The Innovator's Dilemma: When New Technologies Cause Great Firms to Fail, and then replaced the term with a new concept, disruptive innovation, in a later book, The Innovator's Solution: Creating and Sustaining Successful Growth, that he co-authored with Michael Raynor. In their own book, Kotler and Caslione devise and then explore a frame-of-reference for a process of disruption that not only continues but escalates during what Fareed Zacharia aptly characterizes as "the third great power shift in modern history." (The first two were the rise of the Western world (during the 15th century of science and technology, commerce and capitalism, and the industrial and agricultural revolutions; and then, during the concluding years of the 19th century was the rise of the United States whose superpower status has been, for the last twenty years or so, largely unchallenged.) The most recent power shift has been caused by the BRIC countries (Brazil, Russia, India, and China) and various cash-rich countries in the Middle East. The nature and extent of turbulence caused by this most recent power shift are unprecedented.

I especially appreciate Kotler and Caslione's skillful use of several reader-friendly devices that include several dozen checklists (most with annotations and explanations) that are inserted throughout the narrative. They facilitate, indeed expedite frequent review later of key points. For example, factors that can cause chaos (Page 18), hypercompetition strategies and tactics for disruption (Page 31), some of the most common mistakes that business leaders make when turbulence hits (Page 49), the "top-ten" innovation mistakes a company can make during a turbulent economy (Page 57), the sequence of action steps of "one effective and efficient" approach to scenario writing (Pages 92-93), the eight-step chaotics implementation cycle (Page 107), ten recommended practices to "weather" extended periods of economic turbulence (Pages 124-126), ten effective HR recommendations to help keep companies moving forward when the economy isn't (Pages 132-146), four key changes in the marketing landscape (Page 141), eight contingency initiatives while on "active stand by" before turbulence "whips up" again (Pages 151-153), three important recommendations to keep in mind for" keeping your margins above water while you are pushing for deeper market share" (Pages-158-160), six key steps for sales executives to get their sales teams to take on a tough economy and increase badly needed sales (Pages 161-163), and the common characteristics of a "firms of endearment (Page 182). To their substantial credit, after briefly identifying the "what" of these and other business challenges, they focus most of their attention on how to respond effectively to them.

Despite the nature and extent of unprecedented challenges and perils created by "the third great power shift in modern history," Kotler and Caslione remain confident that it is not only possible for companies to survive during The Age of Turbulence; they are convinced that they can thrive while achieving Business Enterprise Sustainability (BES), the subject if their sixth and final chapter. They suggest three "pragmatic steps" that business executives can take (listed and briefly discussed on Page 169) while ensuring that all initiatives are focused on all issues integral to extending the life of the business enterprise for as long as possible. BES "aims for a comprehensive strategy to maximizing the underlying value of companies in the extended long term, while optimizing company performance and value in the shirt and medium term - but never to compromise long term value."

When concluding their brilliant book, Kotler and Caslione quote Arie de Geus's observation, "The natural average lifespan of a corporation should be as long as two or three centuries." What are the common characteristics of companies that have remained in business for that long, or longer? Arie de Geus cites four: sensitivity to their world around them, awareness of their identify, tolerance to new ideas, and conservatism in financing. Today's business leaders need to recognize and take into full account "the new normality - heightened turbulence and chaos." With the capable assistance of Philip Kotler and John Caslione, they will be much better prepared to respond effectively to it.

This book is very focused on today's volatile business world, and I really enjoyed reading it. I recommend this book for the business owner who needs practical "fix it now" advice. The reader will gain so much insight just by reading chapter 2, as it covers topics I'm sure today's business owner is struggling with. I.E. - resource allocation, across the board spending cuts, quick fixes to preserve cash flow, and reducing sales related expenses, etc.

I particularly found a passage in the book that rings true and reinforces my stance that who we are is more important than what we do. The authors state, "So a company's internal and external behavior leaves a legacy that affects the stakeholder's future mindsets and behavior toward the company. Often times this reveals the absence of the company's authenticity, a quality that is becoming increasingly important to consumers." Being authentic in your marketing and business operations in imperative in maintaining happy customers that return. I recommend this book.

Kotler and Caslione cover all the bases about what to cope with turbulent times, but what I found most helpful is their take on the once-in-a-lifetime opportunities that the current situation has created. A practical book by two practical thinkers.

At one look, the reader may be tempted to dismiss Kotler and Caslione for adding fuel to the fire of panic. I will hesitate to do that. I think the book does exceptionally well to remind all that 'the new normal' has come. We must not behave like ostriches that stick our heads into the sand of old thinking and archaic paradigms, while the world screams for a wise response. If one does not embrace the opportunity, it could mean the end of one's business. I like the way the authors instill the idea of change that is broad-based throughout the organization. With attention to detail, the authors apply the strategy to all parts of the company, like Human Resources, Marketing, Sales, Technology, Management teams etc. This represents a desire to build resilience to all parts of the organization. The points brought up are easy to understand and should provide fodder to stimulate thinking rather than supplying ready made answers. Strategic management is never one that can be canned like processed food for consumption. It involves hard work and a clear recognition of the culture and identity of the company's mission and vision. My takeaway is this. It is not the content, but how the book stimulates business leaders to rethink old paradigms and to adapt strategies to respond to the new normal. This is the best contribution from the book. It is essentially about leadership. Bold leadership.

However, my main gripe is that it is still very North American focused. One can argue that it is primarily written for the American audience. Though there are some references to international matters, I think this American-centric presentation will limit the usefulness of the book at an international level. Moreover, this book will be less impactful due to the limited examples, compared to the classic 'Marketing Management' which contains frequent illustrations and anecdotes of real businesses.

I guess, this is because of the nature of the 'new normal,' we cannot rely too much on examples as they would have become irrelevant by the time the book is printed. Sigh. Welcome to the new normal.

conrade

An insightful read to get a better grasp of some of the changes currently taking place in the economic system.

I enjoyed the provided practical advice to connect concepts with strategies that can be implemented in the real world.

On the theoretical and philosophical level, books like the black swan might cover more ground but Chaotics gave me a little bit more bang for the buck in terms of applicability.

The new normal, argue the authors, is things no longer being normal. Things are, and will continue to be, turbulent. How we ran our businesses in the recent past and years gone by is not the way we can successfully survive business life in the new normal.

I found the book enlightening and informative. It's well written and full of tips and ideas that will help you in your business life and life in general.

Highly recommended.

- Susanna K. Hutcheson

The timing of this book could not be any better. Clearly the authors saw the writing on the wall months ago, and knew that the world has irrevocably changed. Bravo!

I'd love to share information on "the new normality" with my executive team but I don't think anyone would want my used copy of Chaotics because I have scribbled notes throughout the entire book. I thought I knew how to drive my company through this economic downturn. But this book forced me to see that this isn't a downturn, it is the beginning of a new reality - what the authors call, "The Age of Turbulance."

This book reads like a simple how-to guide to business management. But it is actually a wake-up call. I read the book in one sitting but found myself wondering why I hadn't yet implemented these seemingly simple ideas in my company.

Kotler and Caslione share the keys to creating an organization that will be "responsive, robust and resilient." If you only read one chapter, make it Chapter 4:

I urge you to get this book and USE it.

What is the book business industry coming to? This tome is only 190 pages long and retails for $[...]. It came across as little more than an expanded article to me. It had an introduction and the following six chapters:

0. Introduction
1. The world has entered a new economic stage: From normality to turbulence
2. Management's wrong responses to turbulence now become dangerous
3. The chaotics model: Managing vulnerability & opportunity
4. Designing management systems for resilience
5. Designing marketing systems for resilience
6. Thriving in the Age of Turbulence: Achieving business enterprise sustainability

This is a strategic planning book. Simple, and short, but strategic planning advice just the same. It emphasizes that companies today need to focus on their vulnerabilities and minimize them while at the same time identify and exploit their opportunities in order to SUSTAIN profits and stay afloat in these "turbulent" economic times.

I think a first grader could have put together 190 pages with this message and done just as well. Nothing new in this book. And nothing particularly well said. 3 stars!

Philip Kotler is the dean of marketing professors; however, in "Chaotics" he attempts to extend his brand too far. The authors argue that these troubled times are not an aberration, but the new face of normal, fed by globalism and technology. Companies now tend to make across-the-board cuts; they need an early-warning system, a scenario construction system, and a quick response system. Kotler and Caslione, like many others before them, attempt to provide such a system.

One of the best-known earlier efforts was Tom Peters and Robert Waterman's "In Search of Excellence." The problem, revealed several years later, was that what looked good in the authors' earlier analysis no longer held true - five years later "Business Week" reported that one-third were in financial difficulty. Similarly, a decade later with Total Quality Management and the Baldrige Award. (This problem of non-repeatability, non-generalizability of "business strategy secrets" has been repeated over and over, and is similarly seen in the financial analyses of Wall Street "quants.") The examples offered in "Chaotics" (eg. Starbucks, Home Depot, U.S. auto companies) are not as decisive as one would wish - even immediately after publication. Further, the authors devote little/no attention to the risks of debt financing - an underlying problem for large and small corporations across the Standard Industrial Classification spectrum.

Nonetheless, "Chaotics" does offer a good reminder that today's business environment is likely to remain tumultuous due to energy transitions, climate change, new financial regulations and practices, cloud computing, disruptive technologies, and the rise of developing nations (eg. Brazil, Russia, India, and China). (Sixty-two of the 2008 Fortune Global 500 were from developing nations.) Their point is reinforced per McKinsey - almost 40% of the leading U.S. industrial companies fell from the first quartile of their sectors during 2000-01, as well as one-third of U.S. banks.

This book is both sobering and practical. The authors initially make a clear-sighted, accessible case for "The New Normality." Gone are the days of recession, recovery and prosperity measured over a period of several years. We are entering a long period of volatility, where economic and market charts look more like an EKG than a sine wave. In Chaotics, the authors make this case in one chapter and then veer away from economic analysis to practical advice for business leaders on how to survive and even thrive during the years of turbulance ahead. I read the book because the concept of Chaotics resonated with me. And I was quite pleasantly surprised to find the economic outline backed up with solid business strategy. Its a good read and not simply an academic essay. I'll definitely use some of the strategy presented here.