Constantinos Markides - All the Right Moves: A Guide to Crafting Breakthrough Strategy
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All the Right Moves: A Guide to Crafting Breakthrough Strategy
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Copyright 2000 President and Fellows of Harvard College
All rights reserved
Printed in the United States of America
03 02 01 00 5 4 3 2
Library of Congress Cataloging-in-Publication Data Markides, Constantinos C. All the right moves : a guide to crafting breakthrough strategy / Constantinos C. Markides p. cm. Includes index. ISBN 0-87584-833-8 (alk. paper) 1. Strategic planning. 2. Technological innovationsEconomic aspects. I. Title. HD30.28.M3536 1999 658.4'012dc21 99-32401 CIP
The paper used in this publication meets the requirements of the American National Standard for Permanence of Paper for Publications and Documents in Libraries and Archives Z39.48-1992.
Page v
CONTENTS
Preface
vii
1 Put Innovation Back into Strategy
1
Part I How to Create a Unique Strategic Position
2 Decide What Your Business Is
27
3 Decide Who Your Customers Are and What to Offer Them
49
4 Decide How You Will Play the Game
81
5 Identify and Secure Strategic Assets and Capabilities
113
6 Create the Right Organizational Environment
129
7 Develop a Superior Strategic Position
147
Part II How to Prepare for Strategic Innovation
8 Understand How New Strategic Positions Develop
169
9 Evaluate and Respond to Strategic Innovation
179
10 Take a Dynamic View of Strategy
193
Notes
203
Index
213
About the Author
219
Page vii
PREFACE
In early 1988, the newly appointed CEO of the small Danish bank Lan & Spar was under pressure to rejuvenate his financially troubled organization. Peter Schou had taken over as CEO at a particularly bad time: deregulation of the Danish banking industry in the mid-1980s had led to mergers, consolidations, and turbulence in the industry. Despite being more than one hundred years old, Lan & Spar was hit hard by the changes in its environment and was in danger of going bankrupt.
Schou had been working in the industry since the age of sixteen. All those years in banking, however, did not make the job he had to do any easier. He knew that the bank's current strategy was not working. He also knew that it was up to him to develop a new one. But what, exactly, should go into the new strategy? And how should he go about developing it?
If Schou had turned to an academic for help, it is unlikely that he would have received much useful guidance. Despite the obvious importance of a superior strategy to the success of an organization, and despite decades of academic research on the subject, there is little agreement among academics as to what strategy really is. Nor could Schou have expected too much help from other CEOs or managers. If asked, most practicing executives would have defined strategy as "the actions you take to achieve your company's objectives." Although technically correct, this definition is so general as to be virtually meaningless.
Needless to say, this state of affairs is unfortunate. Undoubtedly, part of the confusion is self-inflicted. But a major portion of the problem results from a genuine lack of understanding among managers and academics about the content of strategy. We simply do not know what strategy really is or how to develop a good one.
Page viii
This book is concerned with the art and craft of creating strategy. It takes the perspective of a senior manager who is about to develop a new strategy for his or her organization and explores the thinking process that this manager should go through to create an innovative new strategy. It therefore asks the twofold question, "What issues should this manager address in thinking about a new strategy, and how should he or she think about them?"
Despite the seeming simplicity of this question, it addresses one of the most controversial issues in management today. People seem to disagree about almost every aspect of strategy making that this question raises: they disagree about which issues to address in developing strategy, they disagree about the process of developing strategy, and they even disagree as to whether one can "think" about strategy at all.
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