Hypercompetition [Hardcover]

Richard A. D'aveni (Author)

Book Description

Release date: March 28, 1994

General Motors and IBM have been battered to their cores. Jack Welch, the chairman of General Electric, called the frenzied competition of the 1980's "a white knuckle decade" and said the 1990s would be worse. In this pathbreaking book that will define this new age of "hypercompetition," Richard D'Aveni reveals how competitive moves and countermoves escalate with such ferocity today that the traditional sources of competitive advantage can no longer be sustained. To compete in this dynamic environment, D'Aveni argues that a company must fundamentally shift its strategic focus. He constructs a brilliant operational model that shows how firms move up "escalation ladders" as advantage is continually created, eroded, destroyed, and recreated through strategic maneuvering in four arenas of competition. Using this "Four Arena" analysis, D'Aveni explains how competitors engage in a struggle for control by seeking leadership in the arenas of "price and quality," "timing and know-how," "stronghold creation/invasion," and "deep pockets." Winners set the pace in each of these four competitive battlegrounds.

Using hundreds of detailed examples from hypercompetitive industries such as computers, software, automobiles, airlines, pharmaceuticals, toys and soft drinks, D'Avenie demonstrates how hypercompetitive firms succeed in dynamic markets by disrupting the status quo and creating a continuous series of temporary advantages. They seize the initiative, D'Aveni explains, by employing a set of strategies he calls the "New 7-S's" Superior Stakeholder Satisfaction, Strategic Soothsaying, Speed, Surprise, Shifting the Rules of Competition, Signaling Strategic Intent, and Simultaneous and Sequential Thrusts. Paradoxically, firms must destroy their competitive advantages to gain advantage, D'Aveni shows. Long-term success depends not on sustaining an advantage through a static, long-term strategy, but instead on formulating a dynamic strategy for the creating, destruction, and recreation of short-term advantages.

America must embrace the new reality of hypercompetition, D'Aveni concludes in a compelling analysis of the potential chilling effect of American antitrust laws on competitiveness. This masterful book, essentially an operating manual of strategy and tactics for a new era, will be required reading for managers, planners, consultants, academics, and students of hypercompetitive industries.

Editorial Reviews

From Kirkus Reviews

If D'Aveni were not a professor at Dartmouth's Amos Tuck School, one could easily imagine that his grandiloquent management guide was meant to be an absurdist spoof of a publishing subgenre not especially teeming with useful or readable works. Drawing almost wholly on secondary sources, however, the deadly earnest author has cobbled together a repetitious handbook that combines a fevered appraisal of a new menace supposedly convulsing the global marketplace with programmatic recommendations for combating it. According to D'Aveni, the present danger is hypercompetition, a notably merciless form of commercial conflict that can be conducted in a host of ways. By the author's account, preternaturally aggressive enterprises may seek to erode, neutralize, or (more likely) obliterate the comparative advantages of their rivals in areas such as market access, cost, know-how, quality, resources, and timing. Moving on from his anecdotal audit of the no-quarter games cutthroat companies play, D'Aveni identifies the distinguishing characteristics of hypercompetition. He then segues into another by-the-numbers exercise known as the New 7-S's, the collective designation for a series of interactive initiatives that may be employed to sustain momentum (rather than equilibrium) in operating environments subject to sudden change. Similar cases in point range from ensuring superior stakeholder satisfaction and strategic soothsaying through simultaneous and sequential strategic thrusts. Offered as well are tedious takes on such techniques as escalation-ladder analysis and price-quality mapping. Even after allowing for the transforming aspects of advanced technologies, D'Aveni's big-picture perspectives and addled advisories could strike most corporate executives as the virtual realities of an academic theorist convinced he can impose order on a perdurably adversarial business world. The jargon-marred text has tabular material throughout. -- Copyright ©1994, Kirkus Associates, LP. All rights reserved.

Review

George B. Taylor Professor of Entrepreneurial Studies, The Wharton School A matchless contribution, so timely, so relevant, so close to the reality of today's competition that no manager can ignore it.

David J. Ravenscraft Professor of Business Administration, University of North Carolina at Chapel Hill Once every decade or two, a book identifies the path to the next generation of thinking. This is such a book.

Robert C. Purcell, Jr. Executive in Charge, Corporate Strategy Development, General Motors Corporation D'Aveni has clearly broken some new ground with this book. He has effectively challenged many of the 'accepted truths' in the world of competitive strategy.

Donald C. Hambrick Samuel Bronfman Professor of Democratic Business Enterprise, Columbia University D'Aveni advances strategic thinking to the dynamic, give-and-take world that actually confronts company executives.

Paul N. Clark President, Pharmaceutical Products Division, Abbott Laboratories As a participant in an industry that is changing very rapidly, I enjoyed the numerous examples of how others are coping with fast-paced change.

Kenji Wada General Manager, Human Resources, Sony Corporation I found his discussion of the organization refreshing. Hyper-competitionis filled with suggestions invaluable in redesigning a company.

William F. Achtmeyer Managing Director, The Parthenon Group D'Aveni has captured the essence of strategy for the 1990s and the new millennia.

See all Editorial Reviews

Product Details

• Hardcover: 448 pages
• Publisher: Free Press; 1 edition (March 28, 1994)
• Language: English
• ISBN-10: 0029069386
• ISBN-13: 978-0029069387
• Product Dimensions: 6.1 x 1 x 9.2 inches
• Shipping Weight: 1.6 pounds (View shipping rates and policies)
• Average Customer Review: 3.9 out of 5 stars  See all reviews (9 customer reviews)
• Amazon Best Sellers Rank: #239,441 in Books (See Top 100 in Books)

Most Helpful Customer Reviews

5 of 6 people found the following review helpful

5.0 out of 5 stars Excellent, gets to the heart of true competitive advantage. December 15, 1997

By [e-mail]

Format:Hardcover

D'Aveni's view of competition in our global era is right on. Few competitive advantages are truly sustainable, and long-term strategic planning is ineffective. The only long-term sustainable competitive advantage comes from a firm's ability to create short-term advantages that span across numerous competitive arenas - from cost/quality, to know-how, to various types of stronghold positions, to financial muscle. How is that accomplished? By continually disrupting the status quo, changing the rules of the game, by taking an industry in new directions in which competitors' strengths become irrelevant. Strong recommend: lengthy book but "executive summary" is in the 35 page Introduction. Short form paperback version coming out?

17 of 24 people found the following review helpful

2.0 out of 5 stars A Case of Hyperrepetition May 22, 1998

By Dorothy Love, D.B.A. ([e-mail])

Format:Hardcover

Although this book offers a useful compilation of tools, they are hardly original. D'Aveni simply draws--if not plagiarizes--most of his insights from many other books and cases on strategy that have been out there for decades. Many of the passages in D'Aveni's book seem to have been copied from Michael Porter's infamous triology on Competitive Strategy. For example, when D'Aveni lists the strongholds that a company can establish, he lists the very same Entry Barriers that Michael Porter listed in his book over a decade ago. Furthermore, most of the examples that are listed in the book are examples of companies that D'Aveni found in HBS cases--and not his own original case studies.

D'Aveni argues in his book that the environment in which companies compete has transformed into a hypercompetitive environment that breaks all the traditional rules of competition. This hypercompetitive environment has made it more difficult for companies to compete in the marketplace. He also argues that traditional frameworks (e.g., Porter's 5 Forces) of analysis are inadequate and that he has developed a new revolutionary set of analytical tools. However, there are two major flaws in D'Aveni's reasoning:

1. The nature of competition has always been this way. Granted, companies have become more sophisticated and faster when it comes to implementation, but this is simply an evolution and not a revolution.

2. Traditional tools of analysis are not static instruments that only look at a static competitive environment. They are only static, if you use them in such a way, e.g., Porter's 5 forces analysis can be used to evaluate multi-period competitive responses...

Finally, D'Aveni tries to develop his own analytical framework, which he calls the new 7 S's.... But D'Aveni needs to do more than just try to associate his model with McKinsey's old 7 S's model. Although some of his S's are useful, most of his model (e.g., "strategic soothsaying") is not very intuitive or useful for critical analysis of an indust! ry.

In conclusion, D'Aveni's book disappoints because it offers seldomly original insights. If you are looking for more "revolutionary" material consider "Value Migration", "The Profit Zone", Michael Porter's trilogy, Jefferey Ellis' classical treay, or Jean-Pierre Jeannet's book on Global Strategies. Read more ›

4 of 5 people found the following review helpful

5.0 out of 5 stars A new way of thinking August 2, 1997

By A Customer

Format:Hardcover

I had read Hypercompetiton recently and I realized changing our way of thinking about business is one of the biggest challenges of the end of the centuri. D'Avenis model is a breaktrough description about how the market realy works, and how the managers must become more agressive in order to survive to the atack of foreign new game players.

The idea of the unsustainability of the advantages - the core idea of the book- directly destroys Porter's traditional, builded arround researches made inthe 50's.

I strongly recomend this book to be readed by all the executives from a company that wants to become -or remain- a market leader. This is and all-new approach that can make the difference. It is maybe the most remarkable book the 90's has been produced.

Read it

5 of 7 people found the following review helpful

5.0 out of 5 stars Hypercompetition has proven to be a highly useful text. November 3, 1998

By [e-mail]

Format:Hardcover

Contrary to some of the more pedantic opionions noted here, Richard D'Aveni's book on Hypercometition has proven to be highly useful in our strategic planning process. While it is true that one may adapt Porter's traditional approaches, Hypercompetition stimulates more focused thought on the competition - who they are, how you can take them out, etc. Deliberately planning to confront, outwit, and defeat your opponent has been decidedly lacking in modern business lore as of late - the current Microsoft case not withstanding. Hypercompetition may not be the sole game in town, but it gives everyone else a run for their money.

2 of 3 people found the following review helpful

2.0 out of 5 stars Unreadable December 15, 2010

By Jackal

Format:Hardcover

This book was once thought to be the new rival to Michael Porter's books. Porter talked about sustainable competitive advantage and D'Aveni countered that nothing is really sustainable. I don't have any problem with the gist of the argument, but the book is largely unreadable for another reason. It is an orgy of charts and tables and confusing terminology. The author doesn't really try to build on exiting work. He wants to reinvent everything. When the book was written in the mid-90s, management consultants' fancy charts and diagram were in their zenith. So the author tries to awe the reader and runs with it as far as possible. The result is largely unreadable. I would say four stars for actual content and one for style. The book is now 15 years old, so it is not worth more than two stars.

5.0 out of 5 stars Great Book April 18, 2013

By Janaki Penmetsa

Format:Hardcover|Amazon Verified Purchase

The book is very apt for technology driven companies where they have to constantly make incremental improvements in addition to breakthrough every few years ...

5 of 8 people found the following review helpful

5.0 out of 5 stars Must have. October 22, 1999

By g

Format:Hardcover

The strategy challenge is "to know all gurus, but to follow none". You need to resolve your own strategy paradoxes by creatively combining aspects from different approches. There is no one best way to make strategy. However, D'Aveni offers training manual for managers to formulate the desired strategy. Excellent. MUST HAVE.