Those firms, Foster and Kaplan argue, have succeeded at managing the conflict between "adaptive" work and "technical" work. Technical work is that of maintaining present excellence. Adaptive work is exploratory, requiring management to "ask expert questions rather than to fall into the more familiar pattern of providing expert answers." Adaptive work, the authors write, is the fundamental responsibility of management.

Safeguard Scientifics, they propose, is a model that merges the adaptive impulses of a private equity firm with the technical excellence of a public operating company. Since 1977, Safeguard has invested in emerging technology companies, spinning them off as independent public companies when they achieved solid footing. Safeguard continually gives up control, profits from its transactions, and then moves on to the next opportunity. It is "a clear example of how a firm can operate as the creator, operator, and trader of options."

Fair enough. Safeguard certainly presents an intriguing model for future organizations. Here's the problem, though. In the few months since Foster and Kaplan finished writing Creative Destruction, Safeguard has taken a calamitous tumble, both because of its dotcom investments and because of a breakdown in its investing discipline. Likewise, Corning has been hamstrung by slowing demand in its core fiber-optic business. Incubators? Suddenly, they're so 1999.

It took two years for critics to debunk some of the model companies proposed by then McKinsey consultants Tom Peters and Robert Waterman in their 1982 classic, In Search of Excellence. Two decades later, it seems, the half-life of competitive advantage has been whittled down to a matter of months. And for Foster and Kaplan, that's entirely appropriate. Ironically, Creative Destruction's own irrelevance may be the best endorsement it could hope for.

Sidebar: Defining the Periphery

A key to creative destruction is identifying new opportunities at the periphery of your market. In Creative Destruction, authors Richard Foster and Sarah Kaplan offer a template for considering such change:

• Which companies define the periphery of your industry today?
• What business strategies are they pursuing? Which offers the greatest potential? Which represent the greatest threats?
• What new benefits do companies at the periphery bring customers? When will those benefits become economically viable?
• Which current competitors are most vulnerable to attack from the periphery? How and when will those attacks happen?
• Which competitors, both existing and at the periphery, are likely to succeed? Which are likely to lose?
• What are the economic implications of a new competitive order in terms of market share, prices, profits, talent, and value creation?
• What are the implications for your company? What options do you have?