Mckinsey | Talking about strategy

Good Strategy: Bad Strategy. Rumelt

Jul 062011

I look forward to any new strategy book, so was thrilled to get “Good Strategy: Bad Strategy” by Prof Rumelt who McKinsey call ”strategy”s strategist”. Big disappointment!

“Bad strategy” apparently shows up as ”fluff”, failure to face challenges, mistaking goals for strategy, or choosing bad objectives – all common enough, maybe, but these are not any kind of strategy. There are plenty of actual strategy mistakes that repeat endlessly across industries and throughout time, but do not get a mention.

The “good strategy” principles offered are not wrong, but seem to follow a random walk around a variety of concepts – many of which, in the absence of clear instruction, themselves qualify as “fluff”. Plenty of anecdotes to show examples of good and bad, and reasonable-enough principles to follow, but no clue how to actually do what the examples show or how to enact the principles.

Prof Rumelt is no doubt a brilliant strategist, but no-one reading this is going to understand what to actually do to design and implement a strong strategy.

Cost reduction and strategy

Strategy No Responses »

Apr 032010

No surprise I suppose that many companies took the shock of the down-turn to focus on cost-cutting. In What worked in cost cutting—and what’s next? McKinsey’s report of a global survey offers mixed news – yes, plenty of costs were cut, but executives worry about sustaining those cuts and about continuing risks from the sluggish economy. What we don’t know – and probably never will – is the consequences. How many, for example, cut too much, in the wrong areas, and badly damaged their ability to deliver future growth? Some good tips though: Continue reading »

Behavioral strategy

Strategy No Responses »

Mar 252010

Good advice from McKinsey on handling the behavioral issues of strategic decision-making. Important though this is, McK themselves have shown the strategy field offers little rigorous method for working out what to do – an issue that the field in general also worries about constantly. Hardly surprising, then, that in the absence of useful analysis, process is seen as critical. The flip-side is that if good method were available – which it is, of course - biases, power-relations and other social issues would drop away, since it would be obvious that an idea did or did not make sense.

See www.strategydynamics.com

Knowledge brokering in open innovation

Strategy No Responses »

Mar 252010

I strongly recommend a McKinsey article on using knowledge brokering to improve business processes, with some simple but powerful points. E.g. effective business processes are key to performance throughout a firm, and do not result from a random process of making-it-up-as-we-go-along-and-see-what-works, but a deliberate process of search and design. The article focuses on product-related and other simple innovations (not the over-hyped ‘strategic’ type), and includes some nice simple examples.

Scenarios for all

Strategy No Responses »

Jan 152010

McKinsey’s Charles Roxburgh offers nicely practical advice on the use and abuse of scenarios. In the process he points out that the latest crisis many firms find themselves in, like previous ones, was foreseeable and even preventable if management had done this work professionally. And remember scenarios are not just useful for the big firms – any competent management team should be asking itself what range of things could happen, both to exploit incipient opportunities and anticipate new challenges.

Green Recovery

Strategy 1 Response »

Aug 282009

Just been alerted to Green Recovery, another debunking of assertions that it is too costly to tackle environmental damage [notably carbon emissions]. This follows a session I saw from John Sterman of MIT and the Sustainability Institute, which reported McKinsey data showing 10 giga-tons per year [!!] of CO2 abatement potential that is financially profitable to undertake right now. John went on to describe the huge economic dividend to be had by tackling carbon emissions - will feature more on this in a future post.

Skills and capabilities

Strategy No Responses »

Aug 192009

Capabilities clearly enable performance – if your organization can do key tasks, faster, cheaper or better than others, then you will develop stronger resources in a more powerful system than they can. But academic strategy articles on the topic are mostly too abstract to connect with the practical appraisal of skills and capabilities in organizations. So it’s good to see a down-to-earth approach to assessing skills from McKinsey – asking people to evaluate their own needs. But there’s more to a team’s or organization’s capabilities than just the sum of individuals’ skills, so could the same approach work for self-assessment of team capabilities?

If such capabilities consist of Continue reading »

McKinsey ‘business system’

Strategy No Responses »

Jun 272009

McK gives useful short videos in its ‘enduring ideas’ series. The latest I’ve viewed on the business system is a helpful reminder of the old value-chain concept, though it is disappointingly qualitative, even in the ‘How to conduct a good analysis’ section. In fact, value-chain is a better term for what the video describes. Continue reading »

Successful transformation

Strategy No Responses »

May 142009

Readers will know I’m no fan of the obsession with ‘transformation’ in strategy, but it’s sometimes essential or advanageous. In Corporate Transformation under Pressure, McKinsey report a less than 40% overall success rate, especially when used in an effort to get out of trouble – as they say, “this finding seems to contradict the common wisdom that it is hardest to transform a company when it lacks an acute and apparent need for change“. As I’ve said in previous posts, when you are in trouble is a bad time to reinvent yourself – most often better to focus on getting back to the basic, core business model that works.

Helpfully, the article goes on to offer tactics that, when used together, seem to make transformations more successful, depending on the purpose of the effort.

NEW: join strategy dynamics on LinkedIn.

More items on strategy in the crisis

Strategy No Responses »

Apr 212009

Amongst the continuing stream of articles on this, some good ones [I've left out some bad or downright dangerous ones] include: Continue reading »

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Suffusion theme by Sayontan Sinha

Talking about strategy

Good Strategy: Bad Strategy. Rumelt

Cost reduction and strategy

Behavioral strategy

Knowledge brokering in open innovation

Scenarios for all

Green Recovery

Skills and capabilities

McKinsey ‘business system’

Successful transformation

More items on strategy in the crisis

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