BOOK REVIEW: THE WIZARD OF MENLO PARK

By Randall Stross
Crown; 376pp; $24.95

The Good A perceptive account of the inventors' life--and surprisingly limited achievements. The Bad With dozens of Edison biographies, did we really need another one? The Bottom Line Noteworthy, especially for its debunking of Edison mythology.

Consolidated Edison, Commonwealth Edison, Southern California Edison: From the large number of corporate entities bearing the legendary inventor's name, one might deduce that Thomas Alva Edison became fabulously wealthy. Not so. In spite of his unrivaled fame, he was such a business failure that he once contemplated giving up inventing and came to depend on large loans from his friend Henry Ford. A son, Thomas Jr., was provoked to bitter complaint: "You should have been... a millionaire 10 times over if you knew how to handle your own achievements."

The lack of monetary success was strongly linked to two Edison habits: First, he repeatedly refocused on new projects before older ones reached commercial fruition. Then, relentlessly pursued by admirers, the Dean of Inventors proved easily distracted by celebrity. "He was glad to hold forth on any topic, such as the relationship of diet to national destiny," writes biographer Randall Stross. "Pontificating on demand...came to supplant the actual work of inventing."

Edison's fame and how he managed it is a primary theme in Stross' The Wizard of Menlo Park: How Thomas Alva Edison Invented the Modern World. The inventor has inspired dozens of biographies, including Neil Baldwin's much lauded 1995 Edison: Inventing the Century. But the new book, written by a columnist for The New York Times, is both enjoyable and perceptive. Especially noteworthy is its debunking of Edison mythology and its focus on the inventor's true—and surprisingly limited—achievements and failure to capitalize fully on even those.

Stross passes quickly over Edison's youth, including his early work as a telegraph operator. A decision in 1869 at age 22 to become a full-time inventor led him to seek to improve Alexander Graham Bell's rudimentary telephone. And in 1877, while tinkering with the phone, Edison had the idea for one of his greatest inventions: the phonograph, initially little more than a needle soldered to a phone diaphragm and set up to transfer voice vibrations onto wax paper.

That year, a demonstration of an early version of the apparatus to the editors of Scientific American ignited a frenzy. "This was stop-the-presses news," says Stross, describing how the journal delayed publication so it could squeeze in an illustrated story on the gizmo. "Edison would never again enjoy the sweetness of anonymous obscurity." Before long, he was transformed into a "mythic inventor hero."

However, in what would become a pattern, the publicity created consumer demand that went unmet. "Edison simply could not muster the focus to complete [the phonograph's] development," and he allowed the effort to lie fallow for 10 years. He flitted from project to project, promising a revolutionary hearing aid, a giant megaphone, and finally, in 1878, a reliable, long-burning incandescent lightbulb. (Several designs for such lights already existed, but none worked well.) Once more employing a coup de théâtre, Edison wowed members of the press with what Stross terms "sham demonstrations," briefly exhibiting far-from-perfect bulbs. The displays proved valuable as investor bait. In fact, Edison and his staff were a year away from developing a truly durable filament and three years away from commercial introduction of an electric light.

Over several years, his company labored to wire an entire Manhattan neighborhood. That project succeeded with a dramatic throwing of the switch in 1882. But there was no equally dramatic payoff: After a year, only 455 customers had signed up. Nor did Edison triumph with the phonograph, to which he returned in the late 1880s.

Edison's final noteworthy invention would be the kinetoscope, a motion picture machine he unveiled in 1891. It consisted of a wooden console with a peephole through which one viewed a very brief film. But the inventor saw little commercial potential. In Stross' view, the workaholic Edison persistently failed to see "the limitless business opportunities made possible by the commercialization of fun." In the end, a projection machine invented by others was marketed under his name, "the one asset that he possessed that remained valuable."

Edison applied for his final patent in 1931, the year of his death, bringing his personal total to 1,093. It was a seemingly vast accomplishment, even if most of the patents involved minor variations on previous ones. But his estate, first valued at $12 million, was ultimately determined to be worth only $1.5 million. (In contrast, Ford's net worth was estimated some years earlier at $2 billion.) It wasn't chicken feed—but hardly the riches that might have been won by the Man Who Defeated Darkness.

HOW DOCTORS THINK

By Jerome Groopman, M.D.
Houghton Mifflin; 307pp; $26

The Good A rare window into the doctor's mind.
The Bad Waits to the very end to give tips for patients.
The Bottom Line Numerous tales of misdiagnosis--and valuable lessons for everyone.

Over a period of 15 years a young woman named Anne Dodge saw doctor after doctor in a quest to overcome what was consistently diagnosed as an eating disorder. Following meals she experienced nausea and intense stomach pain, and sometimes she vomited. Nothing seemed to help—not therapy, not antidepressants, and certainly not the 3,000-calorie-a-day diet her internist prescribed. Her weight dropped to 82 pounds, and she was in danger of starving to death.

Dodge consulted as many as 30 doctors before she finally found one willing to consider that her problem might be something different from what others had diagnosed. He ran a battery of tests and spent hours talking with Dodge. Finally he hit on the solution: She had a rare autoimmune disease that she could control easily by eliminating gluten from her diet. Almost instantly, Dodge got her life back.

Health-care horror stories such as Dodge's are the backbone of How Doctors Think, by Dr. Jerome Groopman, a practicing physician and a professor at Harvard Medical School. Drawing partly on his own experience, Groopman delves deeply into the cognitive processes and prejudices that can drive physicians toward faulty diagnoses. Add in industry pressures, he argues, such as profit-hungry HMOs and aggressive pharmaceutical marketing practices, and you end up with a recipe for bad medical care. In a tone that grips but is never overwrought, Groopman provides a rare window into the doctor's exam room and passes along lessons valuable to all patients.

In chapter after chapter, Groopman methodically lays out the most common pitfalls for doctors, illustrating each with compelling real-life case studies. For example, there are "representativeness errors," which occur when a doctor's diagnosis is swayed by prototypes. An emergency-room physician misdiagnoses a fortysomething forest ranger's chest pain as a strained muscle because the patient looks too healthy to have heart problems. In fact, he has unstable angina and shows up in the ER the next day with a full-blown heart attack. Then there's "diagnosis momentum," the tendency for each health-care provider brought into a case to accept blindly the initial doctor's diagnosis. "Diagnosis momentum, like a boulder rolling down a mountain, gains enough force to crush anything in its way," Groopman writes. That's what happened to Dodge.

Groopman also makes a strong case against the health-care industry, which he believes is adding to the pressure on doctors to take cognitive shortcuts. As managed-care companies cut reimbursement rates, providers respond by cramming as many patients as they can into a day. Groopman writes of one Boston practice that instructed its physicians to cut each new-patient appointment from an hour to 40 minutes and to limit follow-ups to no more than 15 minutes. Also, they were told to fill out electronic templates as they talked to each patient in the hope that their tablet computers would help speed up the billing process. Meanwhile, the pharmaceutical industry bombards consumers with ads imploring them to "ask their doctors" about new drugs. Many physicians so fear losing business that they would rather give in to patients' drug demands than figure out if the requested medicine is the solution, Groopman says.

While Groopman sprinkles in examples of his own mistakes and those made by doctors who have treated him, the cases beyond his own practice provide the book's most eye-opening moments. He introduces readers to Rachel Stein, a rabbi who adopted a baby from Vietnam. When the child, named Shira, became desperately ill just days after arriving in the U.S., hospital physicians diagnosed her with severe combined immunodeficiency disorder (SCID), an inherited disease common in Asia. The only hope, they said, was a bone marrow transplant, a treatment so harsh it would put Shira's life at risk.

Stein spent hours researching SCID and corresponding with families affected by it. She became convinced that the problem was malnourishment, not SCID, and demanded the hospital run a battery of tests. Stein was right: Shira's immune system was normal, and proper feeding put her on the road to recovery. Because the baby fit the stereotype of the typical SCID patient, doctors overlooked the simpler diagnosis.

The most practical part of Groopman's book is the epilogue. There he encourages patients to challenge their doctors and even suggests the exact language to use. He recommends broad, open-ended questions such as "What else could it be?" or "Is there anything that doesn't fit?" After reading these tales of misdiagnoses and life-threatening decisions, patients will likely decide to take his advice.

BOOK REVIEW: THE STRATEGY PARADOX

Why Committing to Success Leads to Failure (And What to Do About It)
By Michael E. Raynor
Currency/Doubleday -- 303pp -- $27.50

The Good An insightful look at how the prerequisites of success are also the ingredients of failure.
The Bad At its worst, the book rationalizes bad business decisions as victims of bad luck or timing.
The Bottom Line The wide-ranging study of winners and losers provides penetrating insights.

Quick, which of these three companies doesn't fit with the other two: Apple (AAPL ), whose cutting-edge iPod line has made it a darling of Wall Street; IBM (IBM ), whose culture of quickly co-opting the innovations of others has helped it deliver decades of steady returns; or erstwhile media conglomerate Vivendi (V ) Universal, whose failure cost CEO Jean-Marie Messier his job and his shareholders billions in losses?

If you're an investor, you probably consider Vivendi to be the outlier. But according to Michael E. Raynor, author of The Strategy Paradox: Why Committing to Success Leads to Failure (and What to Do About It), there's actually a fine line between Apple's success and Vivendi's woes. Both took bold risks that seemed inherently logical at the time, but Apple's timing with the iPod simply proved to be better than Vivendi's early bet on the Internet--a predicament Raynor calls the strategy paradox. "The strategies that have the best chances of succeeding brilliantly are also the ones most exposed to the most debilitating kind of strategic uncertainty," writes Raynor, a distinguished fellow at Deloitte Research and co-author with Clayton Christensen of The Innovator's Solution. "Whatever the industry, firms that guess right and commit more vigorously to the strategy that fortune ultimately favors will defeat their competitors."

To discover what separates companies that excel from those that fall short, Raynor took a different tack from other management scholars. Instead of merely studying winning companies, in the mode of Jim Collins' classic Good to Great, Raynor also conducted postmortems of thousands of losers. This proved a valuable undertaking, providing many of the book's penetrating revelations.

The author was surprised to find that successful and failing companies shared so many similarities. (On that note, he includes case studies of winning approaches, such as those of Microsoft (MSFT ) and Johnson & Johnson (JNJ ), as well as perceived failures such as Vivendi, Canadian telecom giant BCE (BCE ), and Sony (SNE ), with its unsuccessful Betamax and MiniDisc technologies.) Most had made reasonable assumptions about the future of their businesses and had executed their strategies relatively well. In an unexpected number of instances, what separated the winners from the losers was either poor timing or unforeseeable changes in the landscape that played into the hands of some companies--and out of the hands of others. For instance, Raynor makes the provocative argument that Apple's success with the iPod was somewhat serendipitous: The popularity of Napster and other music-download sites created instant demand for digital-music devices while crushing the market for disc players like Sony's MiniDisc, which Raynor contends was a well-conceived product. Similarly, Vivendi's undoing was that its huge bets on the Internet came too early, and, Raynor argues, that Messier became too involved in minutiae at the expense of broader strategy.

To some degree, this all makes business sound like a crapshoot and explains why many companies opt for a strategy that minimizes failure but limits opportunities for explosive growth as well. But Raynor has created a governance structure that, he contends, allows leaders to forgo this traditional trade-off and achieve high returns even as they minimize the risks associated with growth. For a company to be able to adjust to unexpected shifts in business, he says, many traditional management roles must be redefined.

First, boards of directors should not be involved in strategy, he says. Rather, the role of a director should simply be to define the "strategic risk profile" for the company. "It is legitimately--and perhaps primarily--the board's role to consider carefully the trade-offs between risk and return implied by any strategy that management might propose," he writes.

Next, Raynor argues, CEOs should concentrate not on operations but on developing long-term strategies--or rather, a set of long-range strategic options. Lastly, Raynor favors creating a team of line managers who oversee the company's short-term operations and who don't worry about strategy.

Making these pieces fit together requires a plan, which Raynor provides as well. He suggests that senior-most executives map out every scenario they can imagine, as well as a menu of possible responses for each of these developments. Then, as the future unfolds, they determine which options are appropriate and take action. Overall, Raynor's approach requires more strategic planning than many companies are accustomed to. But if he's right, it could enable them to avoid becoming yet another statistic.