Truth be told, books focusing on business strategy often disappoint, and that can usually be traced to the perspective brought to the project by the authors.
Sometimes the steps or processes recommended for developing a strategic plan are difficult to apply to smaller, growing companies. In these cases, the writer is generally the CEO, president or some other muckity-muck from a mega company with access to resources normally unattainable (or even unimaginable) for the owner/operator of a smaller business.
Other strategy books fall flat because they tend to be overly-academic in nature; heavy on theory and analysis, but light on real-world insight and hands-dirtying experience. Administrators and faculty from top flight business schools turn out dozens of these every year.
Happily, Playing to Win: How Strategy Really Works (Harvard Business Review Press, 2013) by A.G. Lafley and Roger Martin turns out to be the sort of exception that proves the rule.
Lafley, CEO at Procter & Gamble (he returned to the company in May, after retiring in 2010) and Martin, dean of the University of Toronto’s Rotman School of Management, have produced a work that presents a workable, easily implemented plan for formulating a strategy for businesses at nearly any stage of development.
Business Strategy Defined
First things first. Perhaps the most valuable part of Playing to Win is probably where Lafleyand Martin explain, clearly and once and for all, what exactly strategy is. If you can take their definition of strategy, tattoo it on your brain and then reflect on it regularly, your time with Playing to Win will have been well invested.
According to Lafley and Martin, a business strategy is an integrated set of choices that uniquely position the firm in its industry so as to create sustainable advantage and superior value relative to the competition.
Specifically, the choices involve:
- Your Company’s Aspiration (i.e., what do you want to accomplish? Market share? Sales volume? Brand recognition?)
- Where Your Company will Play
- How Your Company will Win
- Your Company’s Core Capabilities
- Your Company’s Management Systems
That might look a bit geeky, but working through the process will allow you to put together a strategic plan for your company that can actually be explained on a single page.
Where Your Company will Play and How Your Company will Win
Playing to Win’s most compelling moments are turned out when the authors discuss choices made regarding where to play and how to win. In fact, Lafley and Martin could and should revisit either topic for standalone titles. (Start agitating, folks.)
Where to Play and How to Win involve specific, well-defined activities, rather than goals or projections (aspirations, in the context of the book).
Where to Play
By definition, determining where to play narrows the competitive field. You can’t be all things to all people, so you need to decide where you’re going to compete.
Depending on your company’s particular situation, it might make sense to compete for a specific demographic, by product or service category, by geography, or even by distribution and service channels.
And don’t think you’re necessarily stuck wherever your company is currently playing. The book details how Procter & Gamble made a deliberate decision to re-introduce Oil of Olay, a skin care product, to the higher-end department store consumer, and move the brand away from the supermarket demographic. The decision not only saved Olay (the “Oil of” was dropped as part of the re-launch), but helped turn it into one of P&G’s fastest growing products over the last ten years, with annual revenues approaching $3 billion.
Granted, sometimes the where to play choice is at least partially made for your company, dictated by geography, marketplace factors and your firm’s resources. But you should still drilldown, and make sure you’re not overlooking niches or areas where you’re positioned to do well.
How to Win
When choosing how to win, your company is making specific decisions relating to how you will create value that is distinctly different from your competition.
This can be undertaken in a two-step process:
- Develop a product or service that provides genuine value to customers.
- Engage in aggressive, powerful marketing plans that clearly explain the value.
When determining how to win, it only makes sense to develop plans that play to your company’s established and recognized strengths. Procter & Gamble relies on its culture of innovation and the power of its individual brands. Your company’s strengths might be tied to value pricing, location, experience, or one of dozens of other factors. It’s your job to recognize and leverage whatever that might be.
Your Business Strategy is as Unique as Your Business
There’s no one size fits all method for developing an effective strategic plan for a company. But Playing to Win at least provides a sensible framework that any business can apply.
Your company’s strategy can and should be as unique and individual as your company. Moving through the five choices defined by Lafley and Martin can help you develop a plan that positions your business to succeed.
Image courtesy Harvard Business Review Press
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