How strategy works when you play to win
How Strategy Actually Works is a book that discusses strategy. It was written by Roger Martin (dean of the Rotman School of Management) and A.G. Lafley ("ex-CEO of Procter & Gamble”). The book covers P&G's "transformation" under Lafley as well as the approach to strategy that informed.
This approach was developed out of the strategy department at Monitor Company. It later became the standard procedure at P&G. The story is about choices.
Strategy: What does it mean?
Strategism is the art of making choices that will win you in the market. Mike Porter, author and most well-respected book on strategy, Competitive Strategy, claims that a firm can achieve a sustainable competitive advantage by "deliberately choosing another set of activities to deliver unmatched value." Strategy is therefore about making specific choices and building a business around these choices. Strategy can be described as a choice. Strategie is more specific. It is a set of choices that positions a company in its industry and creates sustainable advantages and superior value.
Too often CEOs allow the urgent and not the essential to cloud the important. "When an organizational bias drives action, often thinking is lost."
Leaders tend to adopt inefficient approaches to strategy, rather than developing strategies.
They refer to strategy as a view.
Strategy is a plan.
They reject the possibility of a long-term strategy.
Strategy is defined as the optimization or maintenance of the status quo.
Strategy is defined as following the best practices.
Martin and Lafley argue "these ineffective approaches" are driven by a misunderstanding of strategy and a reluctance making hard choices.
Everyone wants to have as many options as possible. However, it is only by making and following through on decisions that you can win.
If a company is determined to play, and not win, it will undoubtedly fail to make the hard decisions and invest the significant capital that would make winning even possible.
However, playing to win can lead you to make mistakes.
The Playbook
Our definition of strategy is a coordinated and integrated collection of five choices. They include a winning goal, where to play and how to win, core capabilities and management systems. These are the five choices that make up the strategic decision cascade. They form the foundation of our strategy work, and the core of the book.
These five interrelated questions are specifically answered by strategy
What is your winning vision? What is your purpose for starting your business?
Which field will you choose to play? It is a place where you can realize your dreams.
How can you win? This is how you will win on the selected playing field.
What capabilities are required? The necessary set of capabilities to win the chosen method.
What management systems are needed? These systems and measures enable and support the possibilities. How to play to win
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