'Good Strategy' Is Good
Erika Andersen, Founder/Partner
So much that’s said and written about strategy is—from my point of view—complete junk, that I get excited when I hear someone focusing on strategy in a coherent and useful way. Richard Rumelt is the Professor of Business & Society at UCLA’s Anderson School, and he’s written a very good book called Good Strategy/Bad Strategy. It may well be that I like it so much simply because he and I have many points of agreement about what makes good strategy and why it’s critical to success. For instance, he believes, as I do, that the key starting point of creating good strategy is getting clear about your challenge. Rumelt also states—and I’ve certainly found this to be true over the years—that most organizations claiming to “have a strategy” have nothing more than some financial goals—with no real, coherent plan for how to achieve them, and no sense of whether achieving them will solve the core challenges they face.
I really like his definition of strategy, too: he says that “the essence of strategy is a clear and differentiated point of view that supports forceful and coherent action.” (You can see the similarities to our definition—“consistently making those core directional choices that will best move you toward your hoped-for future“.)
He also has lots of great examples of both good and bad strategy—from Starbucks to Kenndey’s moon landing; from Continental Airlines to Disney.
My only disappointment with the book is my disappointment with most books on strategy: I’m not sure Rumelt leaves the reader with a clear, simple, straightforward way to approach his or her work and life more strategically. In other words—while he offers really good and sophisticated insight into the nature of strategy, I’m not sure it’s easily “translatable” into everyday life and work. But that’s a small quibble—this is a great new addition to the conversation on strategy: what it is, and why it’s important.