The Entrepreneur’s Book Guide #5: High Output Management by Andrew S. Grove

Book Reviews from one entrepreneur to the others

Starting with my last review, I pushed the long intro about the Entrepreneur’s Book Guide to the very back of the article and dove straight into the book. I believe this makes the review more fun to read, especially for readers who have read some of the earlier editions of the Entrepreneur’s Book Guide.

So without further ado, let’s dig into this week’s book…

The legendary Intel CEO Andy Grove passed away almost exactly one year ago, on March 21, 2016. This is why I decided to cover one of his two most influential books, High Output Management, in this week’s review.

About the author

Andy Grove is considered one of the greatest business leaders of the 20th century. He is idolized by other legendary CEOs such as Steve Jobs, Ben Horowitz, Brian Chesky and many others. But don’t take it from me, hear it straight from the horse’s mouth:

Probably no one person has had a greater influence in shaping Intel, Silicon Valley, and all we think about today in the technology world than Andy Grove.
(Pat Gelsinger, CEO of VMware)

Grove emigrated to the US from Hungary in 1957 at the age of twenty. He went on to become a chemical engineer and started his career at Fairchild Semiconductor. From there he joined the newly founded Intel on the day of its incorporation in 1968, but was never technically named a founder of the company. Grove worked initially as the company’s director of engineering and later went on to become the company’s Chairman and CEO.

One of the things Grove is best known for is what some call “one of the greatest pivots of all time” (Ben Thompson, Stratechery) — the move from Intel the DRAM memory chip maker into Intel the microprocessor company. If you’re interested in the story, this article is a good starting point.

Despite his tremendous success and the resulting fame and fortune, Grove was well-known for his modesty, egalitarian approach and aversion to any kind of priviliges like corner offices or reserved parking spaces.

“Andy Grove was all substance.“
(Ben Horowitz in the foreword to the 2015 edition)

And this substance translates 1:1 into his book, High Output Management.

About the book

The central idea of this book is:

A manager’s output = the output of his organization + the output of the neighboring organizations under his influence.

This central idea clarifies that being a manager is all about translating your skills into a team’s performance. This focus on team performance is the recurring theme throughout the book. By centering all his advice around this seemingly simple formula, Grove manages to drive home many of his points very well — like why training is a manager’s job.

Grove brilliantly manages to concisely explain some very complicated management concepts, like hybrid organizations, task relevant maturity or which mode of control to choose in a given situation. On top of that, Grove introduces you to powerful management tools such as the stagger chart almost in “oh by the way, I almost forgot” manner.

Or, as Ben Horowitz puts it:

In as little as one sentence, it lucidly explains concepts that require entire books from lesser writers. 
(Ben Horowitz in the foreword to the 2015 edition)

What becomes abundantly clear throughout the book is that Grove really wants to help people become better managers. To do this, he goes into the details of even the most menial parts of a manager’s job, like how to run meetings, conduct performance appraisals and take decisions. All this might seem nitty-gritty and sometimes obvious. But in the end, being a manager is rarely only about grand designs but much more often about getting your organization to function.

The book gives some very down to earth advice on this. It teaches things you can do immediately to become a better manager. This hands-on advice is invaluable for anyone wanting to run a team or larger organization.

What do I think about the book?

This book is incredibly helpful in a multitude of situations a manager encounters along the way. I really believe that everyone who has a team to lead should read this book. It can seem obvious at times, but it still manages to get its point across better than most.

That being said, I would love a book that expands these learnings along two fronts. One would be centered around culture — many of the things Grove explains work very well in the US, and maybe in parts of Western Europe — but our businesses are global and our teams increasingly diverse. This is a factor that is completely non-existant in the book. You could say it has a WEIRD bias.

The other avenue that I would like to see an update to is how the manager should manage his or her own psychology and personality, especially in highly stressful situations or under high uncertainty and in desperate times. The manager Grove portrays is highly rational, unemotional and never panics. But hardly anyone of us is like that, at least not all the time. In that regard, Ben Horowitz’ The Hard Thing about Hard Things is the logical follow-up read.

My Rating

  • Entertainment: 2 out of 5
    This is book is extremely helpful and full of great advice— but it’s not really an entertaining read. The writing is good, with a very concise and to the point language. But it is also very technical and a bit dry. You just feel it was written in the 1980s by a guy born before WWII.
  • Novelty: 3 out of 5
    I imagine this book was really, really novel when it was first published. By now, many of its principles and ideas have trickled down into management training and literature and have become common practice. But you still have to look around quite a bit to find a book that is similarly to the point. This is what makes this book so much more than just a has-been in the Business Advice section.
  • Usefulness: 5 out of 5
    This book is extremely useful for anyone who wants to manage better — himself, her team, or an entire organization. It contains great advice, concepts and tools that can very well be applied to any kind of management role at any level.
  • Applicability: 5 out of 5
    Andy Grove’s advice is not only good, the great thing is that much of it is actually applicable to the day-to-day of your company. Much of it you can start doing today — like run better meetings and one-on-ones. Once you have gotten a lot better at one of these things, take another look at the book — I am sure you’ll find some more inspiration for what to improve next.
  • Overall rating: 4 out of 5
    Much of its advice is timeless and so valuable that it deserves 5 stars. The only reason I do not give the highest rating is because the book is starting to feel really dated. The last real update to the book was done in 1995 — think what happened since then in business organizations. Take just the explosion of available communication channels. 
    The other little drawbacks are the total neglect of cultural diversity and a manager’s own psychology.
  • Must-read factor: Pretty high
    If you ever need to manage people, especially knowledge workers, I really recommend you read this book.

About the Entrepreneurs Book Guide

As I am building my company, MinuteHero, I am trying to fill some of my vast knowledge gaps by reading lots of books. Over time I have recommended or given as a gift quite a few of these to friends or business partners.

Soon people started to ask me for book recommendations. This gave me the idea for the Entrepreneur’s Book Guide. I wanted to write book reviews specifically for those of you who want to start your own company or are already running a startup. In the reviews, I will try to explain what I liked or didn’t like, what was useful and actionable and how this book helped me in building MinuteHero.

The reviews are in no particular order, but I do plan on creating an index that is sorted by author and by topic once I have a few of these under my belt.

Over to you: What did you think about the book? Did you enjoy this review? Want me to change something? Let me know in the comments!