Summary of The Three Tensions

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The Three Tensions book summary


7 Overall

7 Applicability

8 Innovation

7 Style


Dominic Dodd and Ken Favaro explain how companies try to solve the conflicts between competing business goals by making unnecessary compromises, and then get trapped in the never-ending spin of “the corporate cycle.” Their book shows how to resolve three central “tensions”: whether to grow or profit, whether to take a short view or a long view, and whether to favor individual units or the larger firm. Their case histories detail how leading companies (Cadbury Schweppes, Gillette and Nokia) thrived by resolving their tensions – and how other major corporations (General Motors and Coca-Cola) lost ground by not heeding them. Dodd and Favaro’s “customer benefit” mantra is simple but appealing, and their writing is pretty sharp. The authors make their case using Russian proverbs, metaphors such as “the mud hut conundrum” and amusing anecdotes of managers caught on the tension treadmill. Their “new way of thinking” sometimes evokes a motivational speaker at the local Holiday Inn, but the authors readily concede that carrying out their advice isn’t easy. They quote some blunt wisdom from corporate executives to add a needed dose of real world gravitas. getAbstract recommends this useful analysis to managers who are trying to balance equally worthy priorities.

In this summary, you will learn

  • What “three tensions” tug companies and their executives in different directions;
  • How companies get snared in these tensions;
  • How managers can escape them; and
  • How escaping them can improve the company and boost shareholder return.

About the Authors

Dominic Dodd is managing director of an international consultancy and Ken Favaro is its co-chairman.



Trapped in the Spin Cycle
You see it in the business news all the time. A company announces a major acquisition to help it diversify, but later its leaders decide it has become unwieldy, and they divest and trim costs. Companies invest for the long term and then retrench to improve today...

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