The Strategy Book gives a clear and concise introduction to some of the main challenges that organizations face. It has many examples from different industries and challenges the reader to ask some difficult questions about their own practices. It is a useful introduction to the subject and a good book to provoke some discussion for more experienced managers.
Strategy, management, global strategy, strategic management, corporate strategy, planning, goal setting, processing, strategy tools, market development, market penetration, brainstorming, Max McKeown, Porter, Immelt, GE, IBM, Google, Wal Mart.
This book is a useful introduction to any student beginning their strategy course. It sets out to answer the following questions:
- What do we know about strategy?
- What can strategy do for you?
- How can you effectively use strategy tools?
- How can you engage people with strategy?
- How do you avoid pitfalls & problems?
It teaches the fundamentals of creating a coherent strategy and gives some interesting pointers towards execution. The structure is simple and clear with neat little chapters and good examples that begin each one. It offers some guidance and expert tips.
It also challenges managers to ask some difficult questions concerning their own practices and services and addresses some of the main risks involved in strategic implementation. The book offers examples from different organizations such as Wal-Mart, GE, Apple etc. However, it deals with strategy as a day to day task.
The second part of the book gives an introduction to some of the key concepts in strategy (Porter, Ansoff, BCG etc.) and is useful as a summary. The aim here is to give managers a toolkit that they can refer to from time to time.
If you are beginning to learn about strategy, this book will give you a good introduction to the subject.
Interesting quotes from the book:
Strategy is about shaping the future. Strategy was first used in Athens (508 BC) to describe the art of leadership used by the ten generals on the war council. Some argue for the more creative, human side, while others argue for the more analytical side of strategy.
Google made the decision to give their engineers permission to experiment in free time. They used this free time to produce an online video service. This experiment taught executives the importance of online video so they bought YouTube.
The smart strategist allows strategy to be shaped by events. Good reactions can make great strategy. Strategy involves competition of goals, and the risk is the difference between those goals and the ability of the organization to achieve them. So part of the risk is created by the strategy.
Strategy is about outthinking your competition. Mark Zuckerberg, while at Harvard, built a website called Facemash ‘for fun’. Even today, Facebook believe that ‘done is better than perfect’.
Kenichi Ohmae, in his classic book The Mind of a Strategist, argues that managers tend to focus too much on beating (or copying) competitors.
Corporate strategy is usually only useful if you get people engaged with helping you to make it work.
Give serious thought to why your company should care about your strategy. Specifically, find problems that the board wants to be solved. What are senior managers scared of? Part of becoming a credible strategic thinker is learning effective approaches to selling ideas for your situation. You’ll know that you’re getting better at selling (or pitching) strategy when managers start coming to you when there is strategic thinking to be done.
Managers sometimes survive by not questioning the status quo, and yet strategy benefits from being able to reverse assumptions.
The idea for Twitter came from a big-picture brainstorming day. Employees from a podcasting company spent time thinking about strategy and how to survive when faced with tough competition from Apple. One came up with an idea for an SMS service. The company decided to prototype it and later the group bought the company. Four years later they had over 200 million users and a multi-billion-dollar valuation. Twitter’s success came from looking beyond the existing plan.
Jim Collins in his book Good to Great argues that small improvements can eventually create a kind of flywheel effect. Each provides momentum for the next until the overall advantage is sufficient to really surpass the competition.
In 2002, Walmart became the world’s largest company based on revenue. In 2010, it had revenues of $421 billion ($50 billion more than Exxon in second place). It now has over 8,500 stores worldwide.
The CEO of IBM, Sam Palmisano, believes in using research to ‘get ahead of the obvious’. “I don’t bore myself anymore with market research” because “estimates will never be right since all they do is take the past to predict the future.”
Competing on price is dangerous. Even if you succeed in being the lowest-cost provider, you will probably have reduced the total size and margins in your market. It’s more attractive (although difficult) to compete on creating new markets.
Technology companies – legal activity buys them time. Apple protected certain features of its original iPod including the click wheel. Without the protection, it would have been copied more easily by competitors who might have succeeded in hiding some of the other advantages of the iPod. The same has been true of the one-click buying process with Amazon or the news feed on Facebook.
Bartlett and Ghoshal argue there are three key tasks of global strategy. Need for efficiency – creating a dispersed, interdependent and specialized value chain; need for national responsiveness – moving to federal structure with different units; and need for innovation – developing simultaneous central, local and global learning.
Strategy is not really a solo sport – even if you’re the CEO.
The new CEO of GE, Jeff Immelt, decided the company should grow organically two or three times faster than GDP. The process had to engage people and empower them to move faster. It took about two years to work out a six-part process for creating and executing.
Larry Bossidy and Ram Charan argue in the book Execution – that it is the discipline of getting things done that really separates successful and unsuccessful strategy.
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Other Book Reviews
Ivana Taylor: “Regardless of which group of business owner or marketer you fall into, you’ll want to read Max McKeown’s, The Strategy Book. I received a review copy from Max after he read one of my reviews. And I’m so glad I took him up on his offer to send it to me”.
Business Traveller: “You could spend the rest of your life reading strategy books (and so avoid the issue altogether!), but if you are short of time and need a practical guide to what strategy is and how it might help you, then this is the book for you.”
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