Good Strategy Bad Strategy: The Difference and Why It Matters

Joe Santos’s comments imply that incumbents had difficulty understanding Starbucks because it was vertically integrated—because it roasted, branded, and served its own coffee in its own company restaurants. Starbucks did not vertically integrate to purposefully confuse the competition. It did so in order to be able to mutually adjust multiple eleme

Thus, once Schultz initiated business operations, he began to accumulate privileged information.

To guide your own thinking in strategy work, you must cultivate three essential skills or habits. First, you must have a variety of tools for fighting your own myopia and for guiding your own attention. Second, you must develop the ability to question your own judgment. If your reasoning cannot withstand a vigorous attack, your strategy cannot be e

The kernel is a list reminding us that a good strategy has, at a minimum, three essential components: a diagnosis of the situation, the choice of an overall guiding policy, and the design of coherent action.

When a product gives a buyer an advantage in competition with others, there will be an especially rapid uptake of the product.

A new strategy is, in the language of science, a hypothesis, and its implementation is an experiment. As results appear, good leaders learn more about what does and doesn’t work and adjust their strategies accordingly.

Intel’s development cycle was 18–24 months, not 6–12 months. It didn’t adapt to this quick development cycle. It wasn’t about to redesign its whole development and fabrication process just for a sideline business.”4 Intel did, however, succeed

IKEA teaches us that in building sustained strategic advantage, talented leaders seek to create constellations of activities that are chain-linked. This adds extra effectiveness to the strategy and makes competitive imitation difficult. What is especially fascinating is that both excellence and being stuck are reflections of chain-link logic.

Follow the story of Nvidia and you will clearly see the kernel of a good strategy at work: diagnosis, guiding policy, and coherent action. You will also glimpse almost every building block of good strategy: intelligent anticipation, a guiding policy that reduced complexity, the power of design, focus, using advantage, riding a dynamic wave of chang