A concise and compelling rethinking of an unjustly deemphasized element of corporate strategy.
A business book offers a panoramic reconsideration of capital expenditure strategy, its place in a company’s overall vision, and its significance in the global economy.
According to Weissenrieder and Lindén, capital expenditure is both absolutely crucial to a company’s success and largely deprioritized. For the most part, firms continue to rely on methodological approaches that date back to the 1960s and fail to take advantage of the considerable progress in computer technology—especially regarding calculative measurement—but even more disastrously assume the perch of “analytic thinking” versus “systems thinking.” In other words, each capex project is adopted in a spirit of reactive assessment, with companies seeing a series of isolated opportunities rather than a “holistic” strategy that examines the whole financial picture. In fact, most capex projects do not add any value, and site managers generally pursue them in order to maintain current operations, not maximize shareholder value. As a result of this piecemeal approach, only a “fraction of the capex budget goes to the sites that are the real economic engines of the company—the powerhouses that keep pouring money into the company’s coffers.” The authors eloquently argue that a company’s prospects for success hinge on the creation of an overarching capex vision that includes a 10-to-15-year horizon of predictions: “Why do some succeed where others end up in disaster? It is not that some companies are luckier with pricing or were dealt a better economic hand. It comes from superior capital allocation decisions; it’s how leadership reacts to those conditions. Poor companies result from poor capital allocation and end up with poor competitiveness and cash flow. Companies allocate resources to assets not creating value and starve those that are.” The authors not only limn a comprehensive synopsis of their radical reinterpretation of capex strategy, but also provide painstakingly granular illustrations—they forward a theory, but a thoroughly empirical one well evidenced by their own considerable experience and a wealth of data.
Weissenrieder and Lindén have a great expanse of experience in capex strategy between the two of them, and their expertise is inarguable—they write with immense confidence and intellectual circumspection. Unlike the typical business book today, which promises the world and largely delivers conventional platitudes, this one is equal to its promises, tackling the issue with all the rigor of an academic treatise. But the volume is not a mélange of intellectual abstractions—the authors make an argument and then provide substantiation for their thesis. And while that argument often is necessarily a technically formidable one—this is not a breezy book—they advance their position with much more lucidity than could be reasonably expected. Moreover, they also consider the macro-level impact of reforming capex strategy, which they believe is an essential part of the “virtuous cycle” of creative destruction as well as a healthy global economy that is financially and environmentally sustainable: “Creative destruction is a fundamental fact of free markets and capitalism, and the fundamental drivers of creative destruction are innovation and capital allocation. The smoother the wheels of the creative destruction process can turn, the higher the economic growth.” This is a masterly and analytically scrupulous work, and it should serve as a model for other books in the genre.
A concise and compelling rethinking of an unjustly deemphasized element of corporate strategy.Pub Date: Sept. 1, 2022
ISBN: 978-1-264-28529-7
Page Count: 240
Publisher: McGraw-Hill
Review Posted Online: Aug. 26, 2022
Kirkus Reviews Issue: Oct. 15, 2022
Review Program: Kirkus Indie
Striking research showing the immense complexity of ordinary thought and revealing the identities of the gatekeepers in our...
A psychologist and Nobel Prize winner summarizes and synthesizes the recent decades of research on intuition and systematic thinking.
The author of several scholarly texts, Kahneman (Emeritus Psychology and Public Affairs/Princeton Univ.) now offers general readers not just the findings of psychological research but also a better understanding of how research questions arise and how scholars systematically frame and answer them. He begins with the distinction between System 1 and System 2 mental operations, the former referring to quick, automatic thought, the latter to more effortful, overt thinking. We rely heavily, writes, on System 1, resorting to the higher-energy System 2 only when we need or want to. Kahneman continually refers to System 2 as “lazy”: We don’t want to think rigorously about something. The author then explores the nuances of our two-system minds, showing how they perform in various situations. Psychological experiments have repeatedly revealed that our intuitions are generally wrong, that our assessments are based on biases and that our System 1 hates doubt and despises ambiguity. Kahneman largely avoids jargon; when he does use some (“heuristics,” for example), he argues that such terms really ought to join our everyday vocabulary. He reviews many fundamental concepts in psychology and statistics (regression to the mean, the narrative fallacy, the optimistic bias), showing how they relate to his overall concerns about how we think and why we make the decisions that we do. Some of the later chapters (dealing with risk-taking and statistics and probabilities) are denser than others (some readers may resent such demands on System 2!), but the passages that deal with the economic and political implications of the research are gripping.
Striking research showing the immense complexity of ordinary thought and revealing the identities of the gatekeepers in our minds.Pub Date: Nov. 1, 2011
ISBN: 978-0-374-27563-1
Page Count: 512
Publisher: Farrar, Straus and Giroux
Review Posted Online: Sept. 3, 2011
Kirkus Reviews Issue: Sept. 15, 2011
BOOK REVIEW
IN THE NEWS
IN THE NEWS
Highly instructive for would-be tycoons, with plenty of entertaining interludes.
Well-crafted memoir by the noted media mogul.
Diller’s home life as a youngster was anything but happy; as he writes early on, “The household I grew up in was perfectly dysfunctional.” His mother lived in her own world, his father was knee-deep in business deals, his brother was a heroin addict, and he tried to play by all the rules in order to allay “my fear of the consequences from my incipient homosexuality.” Somehow he fell into the orbit of show business figures like Lew Wasserman (“I was once arrested for joy-riding in Mrs. Wasserman’s Bentley”) and decided that Hollywood offered the right kind of escape. Starting in the proverbial mailroom, he worked his way up to be a junior talent agent, then scrambled up the ladder to become a high-up executive at ABC, head of Paramount and Fox, and an internet pioneer who invested in Match.com and took over a revitalized Ticketmaster. None of that ascent was easy, and Diller documents several key failures along the way, including boardroom betrayals (“What a monumental dope I’d been. They’d taken over the company—in a merger I’d created—with venality and duplicity”) and strategic missteps. It’s no news that the corporate world is rife with misbehavior, but the better part of Diller’s book is his dish on the players: He meets Jack Nicholson at the William Morris Agency, “wandering through the halls, looking for anyone who’d pay attention to him”; hangs out with Warren Beatty, ever on the make; mispronounces Barbra Streisand’s name (“her glare at me as she walked out would have fried a fish”); learns a remedy for prostatitis from Katharine Hepburn (“My father was an expert urological surgeon, and I know what I’m doing”); and much more in one of the better show-biz memoirs to appear in recent years.
Highly instructive for would-be tycoons, with plenty of entertaining interludes.Pub Date: May 20, 2025
ISBN: 9780593317877
Page Count: 352
Publisher: Simon & Schuster
Review Posted Online: May 12, 2025
Kirkus Reviews Issue: June 15, 2025
SEEN & HEARD
SEEN & HEARD
SEEN & HEARD
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