Likened to the ancient master of strategic arts, Sun Tzu, by Fortune Magazine, Dr Richard D’Aveni lives up to his reputation by advising executives on how to be revolutionaries and others on how to create order out of the chaos that revolutionaries cause.
Richard A. D’Aveni is Professor of Strategic Management at Dartmouth’s century-old Amos Tuck School of Business Administration. The Wall Street Journal recently named the Tuck School as the number one MBA program in the world for the second year in a row, and the Tuck School is the oldest graduate business school in the world.
Far ahead of the Internet Revolution, Richard D’Aveni advised that sustainable advantage is no longer possible. In his best- seller book Hypercompetition, Richard warned that firms will prosper in the long run only if they surprise competitors and create a series of “unsustainable advantages” – brief periods of superiority that destroy the current industry leader’s advantage and provide unique value to customers. In this way, hypercompetitive firms disrupt and confuse competitors and force them to play continuous “catch-up.” In the post-Internet bubble age, successful companies still continually replace their own short-lived advantages with new ones. “The Golden Rule,” D’Aveni says, “is: ‘Do unto yourself before others do unto you.” His provocative analysis and strategy have led management guru Tom Peters to describe him as “a very fresh voice urging managers to build enterprises dedicated to perpetual revolution.”
In keeping with his own view of building new advantages to displace old ones, Richard D’Aveni’s next big insight(contained in Strategic Supremacy) lays out techniques for beating the revolutionary strategies he recommended in Hypercompetition. He advises global giants and other corporations that they will probably never become the elephant that learns to dance, so they should build strategies around their massive resources. To leverage their weight, global firms will need to establish a sphere of influence, beat back the forces of competitive pressure surrounding their spheres, and develop strategies for routing resources within their sphere to contain, shape, absorb, neutralise, hedge, or annul the revolution. Winners also create order out of the chaos caused by revolutionaries through building durable competitive configurations – certain patterns of cooperative and competitive relationships between competitors.
Richard D’Aveni says: “Through the use of unique “concert of power” alliances and competitive pressure strategies, well-established, slower-moving firms can configure the major players and the revolutionaries into a more stable and favourable world.” Some of his unusual and innovative strategies include: creating polarised blocks to deal with revolutionaries, using triangulation strategy to realign the interests of other major firms, and building overlapping.
Like Hypercompetition, Strategic Supremacy is controversial and challenges many popular paradigms. In Strategic Supremacy, he warns the global giants, “synergies are your least likely source of advantage. They are too hard to capture and too vague to understand. Rely instead on your Sphere of Influence to create order out of chaos.” He also warns the revolutionaries, “when you are a fly on an elephant’s butt, the last thing you want to do is to force it to sit down.”
In his latest book, Beating the Commodity Trap, D’Aveni’s critical insight is about how to deal with the worst form of Hypercompetition, Commoditization. He reveals his discovery that there are three types of commoditization: deterioration, proliferation, and escalation. Each of these creates a different strategic dilemma for firms, requiring different methods to take advantage of the trap, destroy the trap, or avoid the trap. The Financial Times of London and the Los Angeles Times both said that these are “issues every firm will have to face”, making this one of the most critical challenges of our times.
A highly sought-after advisor and speaker, Richard D’Aveni has delivered over 500 addresses to audiences of five to five thousand people, including annual corporate meetings, board of directors meetings, professional societies, and senior executive forums.
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