Why Firms Succeed
Kay is a professor of economics at the London Business School. In 1993 he wroteFoundations of Corporate Success, in which he argued that success could be measured as added value or as the difference between the value of a firm's output and the cost of its input. He also identified four areas of potential strength that lead to success: reputation, ability to innovate, market position or strategic assets, and relational contracts or "architecture." His book was the subject of spirited debate in the British business press, with Robert Heller noting inManagement Todaythat several of Kay's "successful" examples had recently faltered, and with theEconomistfaulting Kay for suggesting that the study of management could be "scientific." Many other reviews, however, were quite favorable. He now offers this slightly revised, shortened, and "Americanized" version of his earlier book. Such American businesses as WalMart, Caterpillar, and the Boston Celtics(!) have been added as examples, and a consideration of the way business is transacted internationally is included.David Rouse