The Three-Box Solution: A book review by Bob Morris

Three-Box SolutionThe Three-Box Solution: A Strategy for Leading Innovation
Vijay Govindarajan
Harvard Business Review Press (April 2016)

How almost any organization can preserve its roots, break the chains of the status quo, and build a sustainable future

Over the years, I have read and reviewed all of Vijay Govindarajan’s previously published books and consider him to be one of the world’s most valuable and most influential thought leaders among contemporary business thinkers.

In his latest book, The Three-Box Solution: A Strategy for Leading Innovation, published by Harvard Business Review (April 2016), “VG” provides what he characterizes as “a simple framework that recognizes all three competing challenges face that managers face when leading innovation.” That is, simultaneously managing today’s business while creating tomorrow’s and letting go of yesterday’s values and beliefs that could keep the company stuck in the past. “It’s a powerful guide for aligning organizations and teams on the critical but competing activities required to simultaneously create a new business while optimizing the current one.”

Ultimate objectives:

Box 1: Optimize the current business.
Box 2: Let go of the values and resources that fuel the current business but fail the new one.
Box 3: Invent a new business model.

“Success in each box requires a different set of skills, attitudes, practices, and leadership.” Success also requires seamless coordination of initiatives in each box to achieve the aforementioned objectives. For example, if the company is not functioning at peak efficiency (in Box 1), it will lack sufficient resources and commitment to build its future (in Box 2), and then complete the transition to the future (in Box 3). Just as Boxes 2 and 3 must be protected, Box 1 must remain focused and undistracted. Only then, with the three boxes kept in proper balance, can a business can change dynamically over time.

These are among the dozens of passages of greatest interest and value to me, also listed to suggest the scope of Govindarajan’s coverage:

o Why Is It So Hard to Balance the Three Boxes? (Pages 10-13)
o The Success Trap (13-18)
o Table 1-2: Twenty years of strategic shifts in family entertainment, 1995-2015 (21)
o Keeping It Simple: Basic Principles of the Three-Box Solution (28-30)
o Box 3 Hallmark Principles and Behaviors (40-44)
o Building New Box 3 Capabilities and Processes (52-56)
o Testing Critical Assumptions (57-64)
o The Challenge of Sustaining Balance across All Three Boxes (67-70)
o Box 3 Hallmark Principles and Behaviors(79-82)
o IBM’s Fall from Grace (82-85 and 99-105)
o Metrics (101-103, 127-128, and 129-130)
o Triple Threats: Box 1 in Crisis (114-118)
o Turning Around Box 1 (123-136)
o Balancing the Three Boxes, and First Box 3 Innovation: Worship Plus Outreach (146-149 and 149-155)
o Second Box Three 3 Innovation: The Willow Creek Association (155-163)
o Third Box 3 Innovation: The Global Leadership Summit (163-167)
o Table 6-1: Six leadership behaviors in the three boxes (178-179)
o Tapping into Weak Signals (186-187)
o Planning for the Unpredictable Future (206)

In my opinion, the biggest challenge for leaders is to ensure that their organization coordinates initiatives that occur [begin italics] simultaneously [end italics] in all three “boxes.” Leaders must also make certain that boxes do not become silos, functioning autonomously and independently. Finally, leaders need to ensure that the coordination occurs at all levels and in all areas of the given enterprise.

In his latest book, The Three-Box Solution, Vijay Govindarajan explains HOW.

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