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Clears out the mumbo jumbo and muddled thinking underlying too many strategies and provides a clear way to create and implement a powerful action-oriented strategy for the real world
Developing and implementing a strategy is the central task of a leader, whether the CEO at a Fortune 100 company, an entrepreneur, a church pastor, the head of a school, or a government official. Richard Rumelt shows that there has been a growing and unfortunate tendency to equate Mom-and-apple-pie values, fluffy packages of buzzwords, motivational slogans, and financial goals with “strategy.” He debunks these elements of “bad strategy” and awakens an understanding of the power of a “good strategy.”
A good strategy is a specific and coherent response to—and approach for overcoming—the obstacles to progress. A good strategy works by harnessing and applying power where it will have the greatest effect in challenges as varied as putting a man on the moon, fighting a war, launching a new product, responding to changing market dynamics, starting a charter school, or setting up a government program. Rumelt’s nine sources of power—ranging from using leverage to effectively focusing on growth—are eye-opening yet pragmatic tools that can be put to work on Monday morning.
Surprisingly, a good strategy is often unexpected because most organizations don’t have one. Instead, they have “visions,” mistake financial goals for strategy,
and pursue a “dog’s dinner” of conflicting policies and actions.
Rumelt argues that the heart of a good strategy is insight—into the true nature of the situation, into the hidden power in a situation, and into an appropriate response. He shows you how insight can be cultivated with a wide variety of tools for guiding your own thinking.
Good Strategy/Bad Strategy uses fascinating examples from business, nonprofit, and military affairs to bring its original and pragmatic ideas to life. The detailed examples range from Apple to General Motors, from the two Iraq wars to Afghanistan, from a small local market to Wal-Mart, from Nvidia to Silicon Graphics, from the Getty Trust to the Los Angeles Unified School District, from Cisco Systems to Paccar, and from Global Crossing to the 2007–08 financial crisis.
Reflecting an astonishing grasp and integration of economics, finance, technology, history, and the brilliance and foibles of the human character, Good Strategy/Bad Strategy stems from Rumelt’s decades of digging beyond the superficial to address hard questions with honesty and integrity.
Introduction: Overwhelming Obstacles 1
Part I Good and Bad Strategy 9
Chapter 1 Good Strategy is Unexpected 11
How Steve Jobs saved Apple
Business 101 is surprising
General Schwarzkopf's strategy in Desert Storm
Why "Plan A" remains a surprise
Chapter 2 Discovering Power 21
David and Goliath is a basic strategy story
Discovering Wal-Mart's secret
Marshall and Roche's strategy for competing with the Soviet Union
Chapter 3 Bad Strategy 32
Is U.S. national security strategy just slogans?
How to recognize fluff
Why not facing the problem creates bad strategy
Chad Logan's 20/20 plan mistakes goals for strategy
What's wrong with a dog's dinner of objectives?
How blue-sky objectives miss the mark
Chapter 4 Why So Much Bad Strategy? 58
Strategy involves choice, and DEC's managers can't choose
The path from charisma to transformational leadership to fill-in-the-blanks template-style strategy
New Thought from Emerson to today and how it makes strategy seem superfluous
Chapter 5 The Kernel of Good Strategy 77
The mixture of argument and action lying behind any good strategy
Diagnosing Starbucks, K-12 schools, the Soviet challenge, and IBM
Guiding policies at Wells Fargo, IBM, and Stephanie's market
The president of the European Business Group hesitates to act
Incoherent action at Ford
Centralization, decentralization, and Roosevelt's strategy in WWII
Part II Sources of Power 95
Chapter 6 Using Leverage 97
Anticipation by Toyota and insurgents in Iraq
How Pierre Wack anticipated the oil crisis and oil prices
Pivot points at 7-Eleven and the Brandenburg Gate
Harold Williams uses concentration to make the Gettya world presence in art
Chapter 7 Proximate Objectives 106
Why Kennedy's goal of landing on the moon was a proximate and strategic objective
Phyllis Buwalda resolves the ambiguity about the surface of the moon
A regional business school generates proximate objectives
A helicopter pilot explains hierarchies of skills
Why what is proximate for one organization is distant for another
Chapter 8 Chain-Link Systems 116
Challenger's O-ring and chain-link systems
Stuck systems at GM and underdeveloped countries
Marco Tinelli explains how to get a chain-link system unstuck
IKEA shows how excellence is the flip side of being stuck
Chapter 9 Using Design 124
Hannibal defeats the Roman army in 216 B.C. using anticipation and a coordinated design of action in time and space
How a design-type strategy is like a BMW
Designing the Voyager spacecraft at JPL
The trade-off between resources and tight configuration
How success leads to potent resources that, in turn, induce laxity and decline
Design shows itself as order imposed on chaos-the example of Paccar's heavy-truck business
Chapter 10 Focus 142
A class struggles to identify Crown Cork & Seal's strategy
Working back from policies to strategy
The particular pattern of policy and segmentation called "focus"
Why the strategy worked
Chapter 11 Growth 151
The all-out pursuit of size almost sinks Crown
A noxious adviser at Telecom Italia
Healthy growth
Chapter 12 Using Advantage
Advantage in Afghanistan and in business
Stewart and Lynda Resnick serial entrepreneurship
What makes a business "interesting"
The puzzle of the silver machine
Why you cannot get richer by simply owning a competitive advantage
What bricklaying teaches us about deepening advantage
Broadening the Disney brand
The red tide of pomegranate juice
Oil fields, isolating mechanisms, and being a moving target
Chapter 13 Using Dynamics 178
Capturing the high ground by riding a wave of change
Jean-Bernard Lévy opens my eyes to tectonic shifts
The microprocessor changes everything
Why software is king and the rise of Cisco Systems
How Cisco rode three interlinked waves of change
Guideposts to strategy in transitions
Attractor states and the future of the New York Times
Chapter 14 Inertia and Entropy 202
The smothering effect of obsolete routine at Continental Airlines
Inertia at AT&T and the process of renewal
Inertia by proxy at PSFS and the DSL business
Applying hump charts to reveal entropy at Denton's
Entropy at GM
Chapter 15 Putting it Together 223
Nvidia jumps from nowhere to dominance by riding a wave of change using a design-type strategy
How a game called Quake derailed the expected march of 3-D graphics
Nvidia's first product fails, and it devises a new strategy
How a faster release cycle made a difference
Why a powerful buyer like Dell can sometimes be an advantage
Intel fails twice in 3-D graphics and SGI goes bankrupt
Part III Thinking Like a Strategist 239
Chapter 16 The Science of Strategy 241
Hughes engineers start to guess at strategies
Deduction is enough only if you already know everything worth knowing
Galileo heresy trial triggers the Enlightenment
Plypotheses, anomalies, and Italian espresso bars
Why Americans drank weak coffee
Howard Schultz as a scientist
Learning and vertical integration
Chapter 17 Using Your Head 257
A baffling comment is resolved fifteen years later
Frederick Taylor tells Andrew Carnegie to make a list
Being "strategic" largely means being less myopic than your undeliberative self
TiVo and quick closure
Thinking about thinking
Using mind tools: the kernel, problem-solution, create-destroy, and the panel of experts
Chapter 18 Keeping Your Head 276
Can one be independent without being eccentric, doubting without being a curmudgeon?
Global Crossing builds a transatlantic cable
Build it for $1.5 and sell it for $8
The worst industry structure imaginable
Kurt Gödel and stock prices
Why the 2008 financial crisis was almost certain to occur
The parallels among 2008, the Johnstown Flood, the Hindenburg, the Hurricane Katrina aftermath, and the gulf oil spill
How the inside view and social herding blinded people to the coming financial storm
The common cause of the panics and depressions of 1819, 1837, 1873, 1893, and 2008
Notes 299
Acknowledgments 311
Index 313
Anonymous
Posted June 19, 2011
No text was provided for this review.
Overview
Clears out the mumbo jumbo and muddled thinking underlying too many strategies and provides a clear way to create and implement a powerful action-oriented strategy for the real world
Developing and implementing a strategy is the central task of a leader, whether the CEO at a Fortune 100 company, an entrepreneur, a church pastor, the head of a school, or a government official. Richard Rumelt shows that there has been a growing and ...