In this post, I digest some ideas from the book Good Strategy Bad Strategy, by Richard Rumlet.

At first sight, strategy might not be very relevant when working in IT. Nonetheless, after the increase in the scope of my work I noticed that when zooming out from individual solutions it becomes more and more important to reflect on the strengths and weaknesses of one’s department and how it relates to the larger organization. Perhaps even the larger market. Thriving as a department requires more than setting ambitious goals, and either making those or providing enough talk to set oneself up for making it at some point somehow. It requires a plan to attain those goals too, that is strategy. The core competency behind some of the more recent thoughtpieces about organizing teams around work, and “how to AI”.

Overall Impression

The book has been written by a professor in strategy, and that’s visible. Here and there you can find snippets of generalized wisdom, but overall the book is riddled with examples from companies and situations that demonstrate some key thinkpieces. That’s not necessarily a bad thing, probably a book on theoretical strategy is indigestible, it is just something to keep in mind when picking up this book.

With that having said, the key ideas of what defines good and bad strategy are useful. Especially the distinction between strategy and strategic goals. Next to that, those mentioned examples due provide interesting insights.

I did not know for example how Steve Jobs managed to turn Apple around from delivering many failing products at the same time, to delivering just one very good one. During that turn around, various parts of the company were closed down or redirected, various deals with retailers were canceled because that would always lead to more requirements, more complexity for the underlying products and overall products with less quality. Note that his actions were really dramatic, cutting 15 out of 16 products, 5 out of 6 retailers, he cut out all peripheral products, software development, manufacturing. He shurnk Apple back to a niche producer in the highly competitive personal computer business, a core that could survive.

Some notes from the book

A first natural advantage of good strategy arises because other organizations often don’t have one, and they don’t expect you to have one either.

What is a good strategy?

• A good strategy has coherence, coordinating actions, policies, and resources so as to accomplish an important end.
• Many organizations don’t have this, instead they have multiple goals and initiatives that symbolize progress, but no coherent approach

Having conflicting goals, dedicating resources to unconnected targets and accomodating incompatible interests are the luxuries of the rich and powerful, but they make for bad strategy.

A second natural advantage of many good strategies comes from insights into new sources of strength and weakness.

Bad Strategy

To detect one, look for one or more of its four hallmarks:

Fluff A form of gibberish masquerading as strategic concepts or arguments. It uses “Sunday” words and apparently esoteric concepts to create the illusion of high-level thinking.

A hallmark of true expertise and insight is making a complex subject understandable. A hallmark of mediocrity and bad strategy is unnecessary complexity.

Failure to face the Problem Bad strategy fails to recognize or define the challenge. When you cannot define the challenge, you cannot evaluate a strategy to improve it.

Mistaking goals for strategy Many bad strategies are just statements of desire rather than plans for overcoming obstacles.

Bad Strategic Objectives Those are bad when they fail to adress critical issues or when they are impracticable.

Why is there so much bad strategy

Strategy involves focus and, therefore, choice. Choice means setting aside some goals in favour of others. When this hard work is not done, weak amorphous strategy is the result.

What is a good Strategy

Good strategy is coherent action backed up by and argument, an effective mixture of thought and action with a basic underlying structure that the book refers to as “the kernel”.

So what’s in the kernel then:

• Diagnosis: an explanation of the nature of the challenge
• Guiding policy: for dealing with the challenge, an overall approach chosen to cope with or overcome the obstacles identified in the diagnosis
• A set of coherent actions: designed to carry out the guiding policy.

A guiding policy: outlines an overall approach for overcoming the obstacles highlighted by the diagnosis. It is guiding because it channels action in certain directions without defining exactly what shall be done.

Then a good strategy really acts to bring minds, energy and action together. That’s the leverage that makes it easier to move obstacles.

If there are no imminent feasible objects, see if you can define a proxy objective that is attainable