The Best Business Books Of 1996

From Hollywood scams to Russian booms, from superficial talk-show chatter to deep thoughts about the nature of organization, this year's top 10 business books cover a host of intriguing topics.

Americans have long been known for their optimism. Lately, though, many citizens seem worried that the country--and their standard of living--is on a downhill slide. One attempt to make sense of that concern is Robert J. Samuelson's The Good Life and Its Discontents: The American Dream in the Age of Entitlement, 1945-1995 (Times Books). As Newsweek columnist Samuelson sees it, the country is richer, stronger, and more competitive than ever. But Americans feel they're losing ground because they were promised an unrealistic future by government and private enterprise.

"Something is now ending--the period in our history that began at the end of the Second World War and gave rise to a distinct vision of the American Dream," he writes. What's needed today, says Samuelson, is for true leaders to take up the task of lowering the public's expectations. Reviewer Robert J. Dowling, a BUSINESS WEEK assistant managing editor, found the book to be "a smart, balanced epitaph for an era--with a few clues for what's ahead."

Among the things that worry Americans are relations with other countries--notably Japan and Russia. R. Taggart Murphy's The Weight of the Yen: How Denial Imperils America's Future and Ruins an Alliance (Norton) tackles the question of how the U.S. became dependent on Japanese cash and whether it still matters. Murphy's verdict: It certainly does. The author, a veteran Tokyo-based investment banker, provides readers with a historical review of the U.S. policy blunders that led to record U.S. trade deficits.

"Americans have paid a high price for choosing to borrow money rather than face up to the need for far-reaching debate on the hard decisions that are the genuine stuff of honest politics," concludes Murphy. Reviewer William Glasgall observed that "Murphy writes with an authority that can come only from having watched the growth of a phenomenon from within."

Equally astute, albeit contrarian, are the co-authors of The Coming Russian Boom: A Guide to New Markets and Politics (Free Press)--Richard Layard, a professor at the London School of Economics, and John Parker, former Moscow correspondent for The Economist. Often seen as a basket case, Russia's economy, they contend, "will grow faster over the next 20 years than that of most OECD countries, and probably faster than most emerging markets (outside the Far East)." They predict growth rates of 5% a year by decade's end.

How could that be, you ask? Capitalism, the authors assert, has taken hold, and 70% of the economy is in private hands. Reviewer Rose Brady noted that, despite its underestimation of the ongoing political crisis, the book provides "a solid guide to the new Russian capitalism."

A crisis is also ongoing for the subject of Philip J. Hilts's Smokescreen: The Truth Behind the Tobacco Industry Cover-up (Addison-Wesley). Hilts, a New York Times health and science reporter, portrays Big Tobacco as involved in a conspiracy perpetuated through political funding, half-truths, outright lies, and slick marketing. But, he notes, the industry's act has been unraveling as the public has been exposed to the convincing testimony of numerous whistle-blowers and a trove of damning corporate documents.

Still, the author is no prohibitionist. "Cigarettes must be legal," he says, calling for more effective regulation. With its dramatic detail, the book is "accessible and exciting," said reviewer David Greising.

Smoke, as in smoke and mirrors, was instrumental as well to the efforts of two other empire-builders. Peter Guber and Jon Peters became co-chairmen of Sony Pictures in 1989 on the basis of Guber's hyperkinetic gab and mixed Hollywood track record. And as former Premiere writer Nancy Griffin and Time reporter Kim Masters describe in Hit & Run: How Jon Peters and Peter Guber Took Sony for a Ride in Hollywood (Simon & Schuster), the duo proceeded to give Sony a lesson it won't forget.

The company paid each of them annual salaries of $2.7 million, purchased their film production company for $200 million, and provided each with a corporate jet. In exchange, it got a series of turkeys such as Bruce Willis' Hudson Hawk, a movie that single-handedly lost $42 million. In the end, Guber pushed Peters out, then Guber was forced out--but not before winning an additional $200 million package to make films for the company. Such lunacy is skillfully described in the account, said reviewer Ron Grover, who commended the cautionary tale to "any investor seeking Tinseltown riches."

So on with the show--uh, news. The pundits, commentators, hucksters, and provocateurs who make up the "talkathon culture" of the airwaves are the subject of Washington Post media writer Howard Kurtz's Hot Air: All Talk, All the Time (Times Books). "The national conversation has been coarsened, cheapened, reduced to name-calling...and bumper-sticker sloganeering" as a result of these programs, contends the author.

Kurtz admits that not all talk shows are bad--Nightline and Larry King Live are outposts of sanity, he says, particularly when compared with daytime TV's parade of transsexuals and male strippers. But the problem isn't simply sensationalism: The author faults such commentators as George Will and former U.S. News & World Report Editor David Gergen for their superficial "drive-by journalism." Reviewer Douglas Harbrecht, BUSINESS WEEK's Washington news editor, found Kurtz's effort "delicious to read."

The media spotlight was the last thing General Motors Corp. planners wanted as they focused on the nuts and bolts of a revolutionary product: an electric car, known as the Impact. The engineers faced huge hurdles, particularly the task of squeezing 100 miles of driving range out of an 850-pound battery pack. Many also worried that their careers could be damaged if GM decided to shelve the project. And even as the planners labored in secrecy, GM lobbyists were working to kill the California law that mandated the sale of such cars.

The story is the subject of Vanity Fair contributing editor Michael Shnayerson's The Car That Could: The Inside Story of GM's Revolutionary Electric Vehicle (Random House). Reviewer David Woodruff called it "a masterful account, richly spiced with tales of clashing egos, GM's brush with financial disaster, and its ensuing boardroom coup." And it could hardly be more topical: Detroit's first all-new electric car in three-quarters of a century, the EV1--a renamed Impact--has recently gone on sale in California and Arizona.

It's an innovation that could have competitors sweating, if there is any such thing as a competitor. Challenging "the presumption that there are distinct, immutable businesses within which players scramble for supremacy," James F. Moore's The Death of Competition: Leadership & Strategy in the Age of Business Ecosystems (HarperBusiness) offers an interpretation of today's more fluid corporate relationships. Increasingly, says the author, a management consultant who has worked for AT&T and Hewlett-Packard Co., companies compete and cooperate across a variety of industries--which make up their "ecosystems."

Consider the experience of Microsoft Corp. Its ecosystem cuts across several businesses--personal computers, consumer electronics, corporate-information systems, and communications. But, according to Moore, it is dominant in only one area: the market for desktop-computer operating systems. The author offers lots more tangible examples and weighty concepts in what reviewer Ira Sager found to be "essential reading for managers who want to put today's business climate into a larger, albeit ecological, context."

One barometer of discontent in the office is the number of Dilbert cartoon strips on an office wall. Now managers can tune in by turning the pages of Scott Adams' The Dilbert Principle (HarperBusiness). More than a collection of strips, the book offers withering commentary on such phenomena as mission statements, management jargon, dress codes, performance reviews, and office furniture. "The best kind of communication...conveys the message `I am worthy of promotion' without accidentally transferring any other information," instructs Adams, a former Pacific Telesis Group cubicle-dweller. And, making a bid to be the Ambrose Bierce of our times, he lists 13 "great lies of management," including "employees are our most valuable asset" and "we reward risk-takers."

Amusing but not useful, you say? Well, what about Adams' "tips for gaining wealth and personal power at the expense of people who are studying to be team players"? With a comic strip on nearly every page--some have four--and dozens of E-mailed, true-life anecdotes on management miscues, The Dilbert Principle has only one obvious failing: no stickum to make it easy to post on cubicle walls.

Finally, there is Peter L. Bernstein's ambitious Against the Gods: The Remarkable Story of Risk (Wiley). The effort to measure and cope with risk in fields ranging from engineering, science, and medicine to insurance and the stock market is basic to modern life, says Bernstein. Rather than leaving the future to the gods or fate as the ancients did, modern men and women, from Blaise Pascal to Florence Nightingale, have attempted to predict and assign probabilities to outcomes.

Bernstein, a working Wall Street economist who consults for institutional investors and companies, has produced a lively, panoramic book with a cast of characters ranging from poet-mathematician Omar Khayyam to game theorist and computer designer John von Neumann. What's more, the author works in tidbits of economic research and stories from his own 40-year career. Altogether, wrote reviewer Peter Coy, a BUSINESS WEEK technology editor, "the book is an enchanting blend of history and investment advice." The conclusion? By selecting it or any other of this year's top 10, you'll run little risk of a less-than-engrossing read.

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