What is Strategy? And importantly what it isn't

What is Strategy? (And what it isn’t)

Learning from Michael Porter and HBR

Subhadeep Bhattacharyya

What Strategy is not?

Strategy/Strategic positioning is not ‘Operational Effectiveness’

And the root problem is that organizations and managers are often unable to differentiate between what’s Strategy and what’s merely Operational Effectiveness

What is Strategic positioning?

Strategic positioning attempts to achieve sustainable competitive advantage by preserving what’s unique to the company. It means performing different activities from the rivals or performing similar activities in different ways

What is Operational Effectiveness?

- Every company undergoes the same building blocks of creating, producing, selling and delivering products/ services

- Operational Effectiveness means doing these activities better, faster or cheaper than rivals

Strategic positioning

means performing different activities from rivals or performing similar activities incompletely different ways

Operational effectiveness

means performing similar activities better than rivals

To simply contrast …

Key 3 principles underlying Strategic positioning

Strategy involves a distinct separate set of activities

3 principles …

Consider a marketing-strategy consultancy that’s specialized in advising SMEs on growth with a compensation model that’s 100% tied to performance

Strategy involves trade-offs

A sustainable strategic positioning is as much about saying ‘no’ to activities & positions as much it is about dogmatically being focused . Consider the positioning of Dettol around ‘protection’ for decades

2

1

Creating fit among a company’s activities

For e.g. A company that wants to be lowest cost provide of financial services has to march all it’s functions around the precise proposition. And that permeates all across … from staffing- strategy to the choice of marketing channels

3

11 solid Brand positions that have stood the test of time

In no particular order

Apple. Disruptive design and Innovations

Starbucks. A ‘premium’ coffee experience

In no particular order

Nike. The ‘higher ground’ of athleticism

Volvo. Safety

Walt Disney. Create ‘magic’

In no particular order

Godrej. Superior Products

TATA. Trust

Pepsi. Being ‘Youth’

In no particular order

Walmart. Value for money

Harley Davidson. Ultra-machoism

Google. Intelligence. High product reliability

Thank You

Suggested further readings:

1) HBR’s top 10: The Essentials2) Competitive Strategy. Michael E. Porter

Subhadeep Bhattacharyya. yysubhadeep@gmail.com