Creative Destruction: Business Survival Strategies in the Global Internet Economy [Hardcover]

Lee W. McKnight (Editor), Raul L. Katz (Editor), Paul M. Vaaler (Editor)

Book Description

ISBN-10: 026213389X | ISBN-13: 978-0262133890 | Publication Date: March 19, 2001 | Edition: 1

More than fifty years ago, Joseph Schumpeter stated that processes intrinsic to a capitalist society produce a "creative destruction," whereby innovations destroy obsolete technologies, only to be assaulted in turn by newer and more efficient rivals. This book asks whether the current chaotic state of the telecommunications and related Internet industries is evidence of creative destruction, or simply a result of firms, governments, and others wasting valuable resources with limited benefits to society as a whole. In telecommunications, for example, wireless, IP, and cable-based technologies are all fighting for a share of the market currently dominated by older, circuit-switched, copper-terminated networks. This process is accompanied by mergers, acquisitions, bankruptcies, and investment and divestment in worldwide markets.The selections discuss the primary challenge facing firms, governments, and other players: how to exploit the opportunities created by such destructive dynamics. They highlight the importance of national regulations promoting competition and nonmonopolistic market structures, as well as the role of new technologies such as the Internet in driving down the price and speeding the diffusion of innovative products and services in telecommunications, media, electronic retailing, and other "new economy" industries.

Editorial Reviews

Review

"For those who need to learn how to navigate through the world-shaking storms of innovation that characterize the Information Age, this lucid and insightful volume is required reading."--Reed Hundt, Author of "You Say You Want A Revolution: A Story of Information Age Politics," and former chairman of the Federal Communications Commission

"Of course the Internet will bring new business models, new revenue streams, new organizations and new services, but it is difficult to move beyond short-sighted or self-serving hype.  Where does a thoughtful reader go for an accessible and balanced analysis of structural changes? This book contains challenging and ambitious essays from experts at the front lines of business and academia.  It is essential reading for anyone thinking about the scope of the transformation taking place across the communications industry."--Shane Greenstein, Kellogg Graduate School of Management, Northwestern University

"I wish I had been able to read the book prior to my appointment as Chief Technologist at the Federal Communications Commission. The book's clear and informative explanation of the policy and economic implications of communication changes were stimulating and will be extremely valuable to me in my future activities in the technology policy area."--David J. Farber, Alfred Filter Moore Professor of Telecommunications, University of Pennsylvania, and Chief Technologist of the FCC

"As information networks and services converge and transform themselves from vertically-integrated to horizontally-stratified players, untold disruption is inevitable. Why and how these tectonic forces are taking shape is a vital question to strategic planners in related industries everywhere. This book shines new light upon how tomorrow's winners (and losers) are reacting now."--Doug Bulleit, Chief Strategist, BellSouth Corporation

About the Author

Paul M. Vaaler is Associate Professor in the Department of Strategic Management & Organization, University of Minnesota.

Raul L. Katz is Partner in Communications, Media and Technology Group of the international management and technology consulting firm Booz-Allen & Hamilton.

Product Details

• Hardcover: 250 pages
• Publisher: The MIT Press; 1 edition (March 19, 2001)
• Language: English
• ISBN-10: 026213389X
• ISBN-13: 978-0262133890
• Product Dimensions: 9.3 x 7.3 x 0.9 inches
• Shipping Weight: 1.8 pounds (View shipping rates and policies)
• Average Customer Review: 5.0 out of 5 stars  See all reviews (5 customer reviews)
• Amazon Best Sellers Rank: #1,093,196 in Books (See Top 100 in Books)

Customer Reviews

Most Helpful Customer Reviews

9 of 9 people found the following review helpful:

5.0 out of 5 stars A Multi-Dimensional Examination of a Basic Concept, April 13, 2001

By 

Robert Morris (Dallas, Texas) - See all my reviews
(TOP 50 REVIEWER)    (HALL OF FAME REVIEWER)    (VINE VOICE)    (REAL NAME)   

This review is from: Creative Destruction: Business Survival Strategies in the Global Internet Economy (Hardcover)

There are three recent publications with the same title (Creative Destruction) whose authors correlate Joseph Schumpeter's concept of "creative destruction" with the contemporary business world. Foster and Kaplan explain "why companies that are built to last underperform the market -- and how to successfully transform them" whereas in their work, Nolan and Croson offer "a six-stage process for transforming the organization." In the third volume co-edited by McKnight, Vaaler, and Katz, various authors and co-authors of 13 anthologized essays examine various "business survival strategies for the global Internet economy." I highly recommend all three volumes as well as two of Schumpeter's works: Capitalism, Socialism and Democracy, and, Essays: On Entrepreneurs, Innovations, Business Cycles, and the Evolution of Capitalism.

This book grew out of a symposium held at the Fletcher School of Law and Diplomacy at Tufts University in the spring of 1999. The topic was "Creative Destruction -- or Just Destruction?" Those who presented papers were asked to address "the key technological, regulatory, organizational, and competitive dynamics compelling change in the way firms and stakeholders do business in an increasingly global and Internet-centric society." At the symposium there were (and in this volume there are) four points which are consistent with the theme of "creative destruction":

The Destruction of Traditional Industry Structures

The Destruction of Traditional Regulatory Structures

The Destruction of Traditional Competitive Positioning Strategies

The Destruction of Traditional Technological Assumptions

It is important to keep in mind that this is not a manual. Although there are numerous suggestions, checklists, points of emphasis, graphic illustrations, and examples offered, the volume's primary purpose is to stimulate continued discussion and debate on the major challenges now facing firms, governments, and other players -- while suggesting "how to exploit the new opportunities created by creative dynamics."

The material is organized within five Parts: Introduction, Theory and Practice of Creative Destruction, The Global Context for Creative Destruction, Business Destruction Strategies in the Global Internet Economy, and Creative Business Survival Strategies. For the reader's convenience, the editors offer brief comments about each subject and about each of those who address it. After reading the excellent Introduction, you may decide not to read the everything that follows from beginning to end. In that event, select what is directly relevant to your and your organization's most immediate and urgent needs and interests. (In all probability, some of those needs and interests will soon change.) The editors provide three supplementary sections (Contributors, Notes, and References) which assist and encourage further study as well as "continued discussion and debate."

I am curious to know what Schumpeter would say about the material in this book if he were discussing it as I am now. My guess (only a guess) is that he would observe that his basic concept of "creative destruction" remains relevant but the process is occurring at an ever-increasing velocity and in ways and to an extent he could not have envisioned 50-60 years ago. Another guess (only a guess) is that, based on what is now happening (and not happening) in the global community, he would suggest that process of "creative destruction" in all organizations (regardless of their size or nature) has only begun. The Chinese character for the word "crisis" has two meanings: "peril" and "opportunity." For many (perhaps most) organizations, the process of creative destruction means death; for others, it offers the opportunity for at least survival and perhaps regeneration. The authors represented in this superb volume help us to understand the differences between the two groups....also, the probable consequences of those differences.

7 of 9 people found the following review helpful:

5.0 out of 5 stars A Lego Box of Valuable Ideas, May 8, 2001

By 

C. Neff (Denver, CO USA) - See all my reviews
(REAL NAME)   

This review is from: Creative Destruction: Business Survival Strategies in the Global Internet Economy (Hardcover)

Rather than focusing on a single angle and building a long argument in its favor, this compendium's treatment of diverse dimensions of creative destruction lets the reader paint his or her own picture of the net effects of Schumpeter's famous concept. The book's 11 articles touch on topics as diverse as the future of telecommunications firms in a Net-centric world, the impact of regulatory reform on the Internet in Europe, the institutional barriers to Internet-driven creative destruction in Japan, and the impact of open-source software business models.

Creative Destruction is a Lego-box of interesting ideas that managers and academics can recombine into constructs valuable to their work, teaching, or research. I found it very rich reading.

3 of 4 people found the following review helpful:

5.0 out of 5 stars A thoughtful and highly useful book, July 9, 2001

By 

Isaac Fox (Maplewood, MN USA) - See all my reviews

This review is from: Creative Destruction: Business Survival Strategies in the Global Internet Economy (Hardcover)

This is an outstanding collection of articles. These papers combine scholarly depth with usefulness for practitioners. They will help you understand where we've been and forecast where we are going with the Internet. I teach courses on Internet Business Strategy and will use this collection next year. My favorites are Baumol's "Innovation and Creative Destruction; McKnight's "Internet Business Models: Creative Destruction as Usual" and Lehr's "A New Theory of the Internet Firm." They provide a solid conceptual basis for understanding the implications of the Internet economy. One thing truly unique about this book is the thoughtful and detailed discussions of the implications of the Internet on international business. There are six papers that focus on these issues. I have not seen this anywhere else. In a world where people publish books peddling derivative nostrums about the network economy, it's a pleasure to finally find one that deals with these issues in a serious, thoughtful and, most of all, useful way.