Download , by Richard Rumelt
Download , by Richard Rumelt
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, by Richard Rumelt
Download , by Richard Rumelt
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Product details
File Size: 6607 KB
Print Length: 336 pages
Publisher: Currency; 1 edition (July 19, 2011)
Publication Date: July 19, 2011
Sold by: Random House LLC
Language: English
ASIN: B004J4WKEC
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I thought I remembered my friend Art Petty saying that he liked Good Strategy Bad Strategy: The Difference and Why It Matters by Richard Rumelt. So, I emailed him and asked if that was true. Here’s his reply.“Like is an understatement. Rumelt’s kernel of Strategy is the most powerful, supple approach for creating clarity and coherence on strategy I’ve yet encountered.â€Art’s no novice. He’s been an effective executive and an effective consultant for decades. He works with clients on strategy. And, guess what? The book lived up to Art’s recommendation and then some.The kernel of Strategy that Art referred to is a great reason to read the book, even if that’s all you get out of it. Here’s Rumelt’s description of the kernel.“A good strategy has an essential logical structure that I call the kernel. The kernel of a strategy contains three elements: a diagnosis, a guiding policy, and coherent action. The guiding policy specifies the approach to dealing with the obstacles called out in the diagnosis. It is like a signpost, marking the direction forward but not defining the details of the trip. Coherent actions are feasible coordinated policies, resource commitments, and actions designed to carry out the guiding policyâ€.The kernel isn’t a magic formula. It’s a guide to the most important hard work you will do to create a strategy. If you’re a consultant, it’s a quick way to help you figure out if your client has a strategy or not. As Rumelt points out in the book, a lot of things masquerade as strategy. Plans and slogans and goals can look like strategy until you analyze them with a tool like the kernel.What makes creating a great strategy hard is that it involves choices, and we don’t like choices. We also don’t like hard work, so we skip the hard parts and just do the parts that are fun.In my experience, an awful lot of companies spend a day or so developing their strategy. They substitute discussion for diagnosis. Talk replaces analysis. Then they trot out some fine-sounding generalities instead of taking time to craft guiding principles. Biz-speak often replaces clear language here. There’s a lot of talk about what to do, but precious little about how to coordinate activities.Most of those companies spend most of their time on what they’re going to do, after skipping the hard parts of diagnosis and guiding principles. Art says that, since reading Rumelt, he spends more time on the strategy process. He spends half of the time on diagnosis, another 40 percent on what Rumelt calls the guiding philosophy, and 10 percent on coherent actions. It’s much harder to do it that way than it is to go off to an offsite and whip up some generalities that sound good but don’t have much impact on day-to-day work life.Here’s what it comes down to. The kernel is the way you develop a good strategy. The kernel is also the way that you identify bad strategy, whether it’s yours or someone else’s. Now that I’ve read this book, I won’t think about doing strategy the same way ever again. Rumelt has helped me know some danger signals to watch for. And he’s given me a language for guiding the process of creating and evaluating a strategy.The kernel is reason enough to buy and read this book, but there are lots of other goodies here, too. There’s analysis of many business situations that I found both absorbing and compelling.There’s one other thing you can take away from this book. Even when you do the work to create and execute a good strategy, you can still not succeed. You can make bad choices, even with a good process. Luck still plays a role. Unforeseen events play a role. The competition plays a role.This book was written in 2006. Rumelt makes several predictions about how some things will play out in the years ahead. He gets some of them right, some of them wrong, and some of them a mix of both. That’s a good thing because it demonstrates what’s true in real life. There are times when you can do everything wrong and have things turn out right. And there are times when you can do everything right and still go down in flames.One of my favorite quotes about life is from the American writer and horseplayer, Damon Runyon. It goes like this: “The race may not always be to the swift, nor victory to the strong, but that’s the way you bet.†Developing a good strategy is the hard work of figuring out how to bet.In A NutshellGood Strategy Bad Strategy: The Difference and Why It Matters by Richard Rumelt gives you a roadmap that will help you develop better strategy. Ironically, that will make your work harder. Thankfully, it will also increase your odds of success.
Rumelt's `Good Strategy Bad Strategy' provides a refreshing, straight-forward take on business strategy basics. Written in an informal tone, the reader can immediately connect with the author. The book demonstrates strategies from large corporations and his personal anecdotes. Rumelt cuts through the common strategy jargon and differentiates real strategy from misguided goal setting. The book follows this pattern, through Chapter 6, at least. Then somewhat unexpectedly, the book turns from `straight-shooting' business strategy to theoretical concepts and meandering stories, leaving the reader wondering, `where exactly this book is headed'.On the positive side, the book is worth its purchase price for the clarity Rumelt offers on how to create good strategy. He uses the `kernel' method emphasizing the need to identify the structure of a current business challenge, choosing a `guiding policy' for dealing with the challenge, and lastly designing a series of actions or resource allocations in order to implement the `guiding policy'. With his solid advice and focus on action items as the underlying mechanism for effective business strategy, it begs the question in today's market, `how can so many of today's corporations issue strategies that are `fluff' and no action. Rumelt hits the nail on the head with the majority of the examples he uses, one of which, after peeling away the layers of a corporate bank's `strategy' the core message is a bank exists to be a bank. Rumelt uses the bank example to show what strategy is not. Strategy is not a goal setting, is not a budget and is not a laundry list of lofty desirable outcomes. Good strategy is specific and action-oriented.In the same vein, another positive point for the `Good Strategy Bad Strategy' content is that Rumelt identifies the core element to initiating a good strategy: "discovering the critical factors in a situation" and creating a set of actions to deal with the situation. The emphasis on taking action is a key component of the book. It is often missing in the cultural jargon and `fluff' that other strategic books espouse. In this book, strategy is not disguised as a company's mission and/or values. Additionally, Rumelt highlights that a coherent strategy does not consist of companies with too many objectives; as this ultimately results in a loss of focus.On the other side of the coin, after Chapter 6 the reader will need to have patience to work through the concepts and examples Rumelt presents. It would be most beneficial if the reader is already well-versed in management strategy and/or has years of on the job experience in order to best apply and thoroughly understand his examples on proximate objectives, chain-link systems and inertia and entropy. The examples come more from his personal consulting experiences and the demonstrative stories are not as direct and to the point as the examples in his first few chapters. The overarching concepts are relevant to strategy, but again unless the reader is well-versed in management strategy the application or replication of these concepts may prove difficult.Overall, `Good Strategy Bad Strategy' is a recommended read for those interested in business strategy. The no-nonsense approach is refreshing and there are definite `pearls' of strategic wisdom in the book. There are a myriad of examples from history and business cases in which Rumelt's strategic advice draws upon. However, the reader should keep in mind that the later sections of the book are lackluster compared to the first few chapters. With that said, the book should still be given a chance and is worth its investment. All in all, the book is a `mixed bag', but take a chance and see for yourself.
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