From mass layoffs to the politics of hybrid work, there has been no shortage of business challenges in 2022. Next year will likely prove no different.
To prepare yourself, check out my annual list of the best business books. Some of them dive into specific issues (e.g. supply chain disruption or labour shortage), some will see the upside of uncertainty (the actual title of one of the books), and all of them are fun to read.
The starting point of my list was a recent survey of the biggest challenges faced by companies right now.
1. The Crux: How Leaders Become Strategists by Richard P. Rumelt—Overwhelmed by all the challenges your company faces? No need to despair, Rumelt’s new book is out. Strategy is all about finding addressable problems he argues. Here is how it works: Start by listing all the potential problems you face. Then score them on a scale from 1 to 10 on two dimensions: 1) how important is the issue and 2) how addressable is it. Finally, map the results. Pick the one scoring high on both importance and addressability. Taking this approach results in unique killer strategies. For example, when Netflix
2. The Upside of Uncertainty: A Guide to Finding Possibility in the Unknown by Nathan Furr and Susannah Harmon Furr—This book is the natural companion of The Crux, tackling engagement with challenges on a more personal level. We are all hard-wired to hate uncertainty but the authors encourage us to look at the other side of the coin. They guide us from fearing and avoiding uncertainty to embracing it as the origin of possibility. This can be achieved through a large set of tools, each explained in a short chapter. Among them are framing, which helps you to anticipate gain; adjacent possibilities that allow you to hover at the edge of awareness; and the infinite game, teaching you to question the boundaries and rules of the game you play. I love the solid foundation on which the book is built. Interviews, academic literature streams from multiple disciplines and historical case studies not just from business but also artists and paramedics feature. The authors even allow us a glimpse at their personal encounters with uncertainty.
3. Deep Purpose: The Heart and Soul of High-Performance Companies by Ranjay Gulati—In 2019 the Business Roundtable redefined the purpose of the corporation to promote ‘An Economy That Serves All Americans’. Next came the pandemic and, as Klaus Schwab of the World Economic Forum put it, “… a litmus test for stakeholder capitalism”. Old reflexes are hard to kill and few were surprised that stakeholders often mattered less than short-term profits. Gulati’s nuanced book distinguishes between different types of purpose. I was won over when he started to dissect activities at Mars. At first, the impression is that he holds up Mars as an example of a purpose driven company, citing the usual activities of many corporations engage in. But then his story takes an unexpected turn. Mars has not pursued purpose peripherally but as long as it continues to make a living from unhealthy snacks, the loft goal of making the world a better place is rather hollow. This is convenient purpose, not deep purpose. To achieve the later it would require a substantial shift in the product portfolio. In the book he explains how deep purpose can be achieve and links it to superior long-term performance. Maybe this book gives stakeholder capitalism a second chance.
4. The Burnout Challenge: Managing People’s Relationships with Their Jobs by Christina Maslach and Michael P. Leiter—“I love my work. … But I work in a socially toxic workplace. This is a highly political environment that encourages competition between colleagues, backstabbing, gossiping, and hiding information.” This quote from a tech worker on the book’s second page introduces a paradox. Even though companies are going to great efforts to make jobs more meaningful, complaints about incivility, abuse, and bullying are at an all-time high. Maslach and Leiter’s crucial insight is that characterizing burnout as a personal issue prevents us from finding lasting solutions. A thoughtful and well research book about a core issue at the heart of the great resignation. If you want to overcome labour shortage issues, this book helps you create a work environment which does not overwhelm people. Sounds simpler than it is.
5. Streets of Gold: America’s Untold Story of Immigrant Success by Ran Abramitzky and Leah Boustan—Labour shortage has not exactly arrived overnight. The retirement of baby-boomers has been entirely predictable. The most obvious solution has also been obvious for a long time. Most western economies need more immigration. A lot more! This, however, is a highly controversial topic. Abramitzky and Boustan use the power of machine learning to sift through millions of immigrant stories, thereby providing a comprehensive picture of immigration. It’s a bit like researching your family’s history but doing this for everyone. You are wondering why this is a business book? When companies argue for more immigration, they need to build a compelling story, a story that convinces politicians and their voters. This book will help you to achieve this by looking at how immigration affects us over a generation rather than a short election cycles.
6. Shared Sisterhood: How to Take Collective Action for Racial and Gender Equity at Work by Tina Opie and Beth A. Livingston—In the summer of 2020 Opie’s inbox started to flare up. With protests across the nation, social justice was on the agenda and many executives need her help. “What to say and do?” they wondered. An activist at heart, she realized two things. First, the agenda will move on. Second, a powerful coalition is needed to achieve institutional change. For too long white and black women have been divided. She teamed up with Livingston to work on Shared Sisterhood, an agenda setting, yet practical book. One of the techniques they share is amplification. Before you speak up in a meeting, ask two of your allies to back you up. So once you speak one of them immediately chips in what a great idea this is, followed by the second one. A simple, yet powerful way to lend voice to someone usually less visible.
7. Power and Prediction: The Disruptive Economics of Artificial Intelligence by Ajay Agrawal, Joshua Gans and Avi Goldfarb—Twenty years after Thomas Edison invented the light bulb only 3 percent of US households had access to electricity. Few factories used the new power sources. In subsequent two decades, this started to change radically as entrepreneurs came up with solutions leveraging the new power source. AI is in the equivalent in-between phase. In this book Agrawal, Gans and Goldfarb explore the implications of this insight. How do we need to design products and services to make the most of AI? Fundamentally they argue, that the opportunity of AI lies in the decoupling of prediction from decision making. That’s a bold hypothesis—in Uncharted: How to Map the Future Margaret Heffernan argues convincingly that our addiction to prediction is unwise—but no doubt an interesting one to explore. Definitely a book you should read. If nothing else, at a time when we face a recession, this book offers a hope for a better future.
8. Chip War: The Fight for the World’s Most Critical Technology by Chris Miller—Supply chain issues keep many mangers awake at night. Those who need semi-conductors might be the most sleep deprived. Unfortunately, this book is not going to put them at ease. Miller skilfully takes us through the history of the industry and comes to the conclusion that few sectors are as exposed to the rising geo-political tensions. As a growing number of executives start to realise, there is a Taiwan risk they have not factored into their plans. Responding to security concerns Washington is trying to respond with reshoring but economically that is not necessarily an easy move to pull off. This book is different from the other ones on my list in the sense that the main aim is not be instructive for managers. This does not make it any less practical, as you will go away with a profound understanding of a fundamental issue likely to affect your company. The Financial Times recently selected it as the business book of the year.
9. Quit: The Power of Knowing When to Walk Away by Annie Duke—The idea that losses loom larger than gains go back to some of the earlier work of Nobel laureate Daniel Kahneman. It’s hard to quit. Even more so as persistence is celebrated in the business press. As Duke points out, this stems from a misinterpretation of popular books such as Grit. It’s author Angela Duckworth is explicit about trying out different things which implies quitting those that don’t work. But how to do quitting right? Duke investigates the biases that prevent us from quitting and how to overcome them. An entertaining book that starts with boxing legend Muhammad Ali.
10. The Unicorn Within: How Companies Can Create Game-Changing Ventures at Startup Speed by Linda K. Yates—Few ideas capture the minds of CEOs as much as the late Clayton Christensen’s thesis that established companies develop new disruptive technology but fail to turn it into a viable business. This is where new competitors come into play. More recently the successful ones enjoyed 1 billion valuations and became known as unicorns. The ailment was clear but the antidote less so. At least not in the detail that executives need to act. This is where Yates book enters the stage. It offers an actionable playbook for big corporations, for example when it outlines how exactly you can leverage the “mothership advantage” through a combination of customer driven, repeatable, saleable methodology and careful navigation of the frictions stemming from inertia, orthodoxies, and key performance indicators. This granularity makes up for the book’s biggest weakness, a lack of data and long case studies. Without this evidence we simply have to believe the author that this works. It’s worth a try.