Sunday, April 29, 2012

Mirror, Mirror, What is the Best Strategy

The strategy is about shaping the future, and the future is more about progress and evolution.


A strategy is a set of choices following with a series of action designed to achieve a vision and compete for the future. There’re so many good strategy theories from ancient to contemporary time, from eastern to western philosophy, today’s strategist may just wonder: what is the best strategy?

 1. The Origin of Strategy

To trace its lexical root, a strategy derives from the Greek strategia, "office of general, command, generalship,”  the Greek equivalent for the modern word “strategy” would have been “strategike episteme” or (general’s knowledge) “strategon sophia” (general’s wisdom). One of the most famous Latin works in the area of military strategy is written by Frontius and has the Greek title of Strategemata.

Sun Tzu’s "The  Art of War," written in 400 B.C. has received critical acclaim as the earliest and best work on military strategy, including those that have followed it centuries later.


 2. The Magic “Five” in Some Famous Strategy Theories

  • Mission: Inspire people to share the same visions, ideas, and expectations
  • Ground: to be able to master mountains, valleys, rivers, plains, etc. it’s about situation,  distant or immediate, difficult or easy, opportunities and risks
  • Climate: it’s nature, changes in climatic conditions
  • Command: Leadership, such as wisdom, humanity, credibility, courage, intelligence and firmness. 
  • Method: the discipline, the moral cause, reward, punishment, logistics, and metrics.
Key Take away: Winning without Conflict: Sun Tzu's book teaches winning without conflict. “A great general finds a way to win without fighting a single battle, human wisdom is the best  weapon".

Von Clausewitz's book On War is classic, he had a career in the Prussian army, and served in a number of major campaigns, he was a thinker and philosopher who studied war to with in-depth knowledge that no one else had ever done before. He also believed that war was more like a business. As he points out, both war and business involve the clash of interests. Here are his five principles.

  • The principle of Plan Well with Simplicity.
  • The Principle of Unity of Command.
  • The Principle of Historical Examples
  • The Principle of using the superiority of numbers to good effect.
  • The principle of System Thinking: We are part of a wider system that controls us more than we could ever know.
  3) Musashi Miyamoto: Five Rings of Strategy: 
As Sun Tzu, Miyamoto Musashi was well known as a great warrior and strategist lived four hundred years ago, his books of "Five Rings" also make significant impact on shaping modern business strategy and the art of wisdom:
  • Ground: Knowing the smallest and biggest thing, the shallowest thing and deepest thing.
  • Water: With water as a basis, the spirit becomes like water, water adopt the shape of its receptacle.
  • Fire: The spirit of fire is fierce, whether the fire is small or big, you must appreciate the spirit can come big and small
  • Wind:  means old traditions, present-day traditions of strategy. It is difficult to know yourself if you do not know others.
  • Void. means that which has no beginning and no end. Attaining this principle means not attaining the principle. The Way of strategy is the Way of nature.
 The Gaze in Strategy: Perception and Sight: In strategy it is important to see distant things as if they were close and to take a distanced view of close things.



Modern business strategist: Michael Porter’s Five Forces strategy, a SWOT analysis model on creating a strong position for product or service that allows it to garner outsized profits, makes a significant influence on contemporary business society.
  • Marketing Entry: How easy is it for others to enter the market? 
  • The threat of product/service substitution
  • Bargaining power of buyers.
  • Bargaining power of suppliers
  • Rivalry among current competitors.
 Porter’s latest social dimension in strategy: All profit is not equal. Profit involving shared value enables society to advance more rapidly and allows companies to grow faster.  

“In Blue Oceans, demand is created rather than fought over. There is ample opportunity for both growth and profit.”  W. Chan Kim & Renee Mauborgne

  • Reconstruct market boundaries
  • Focus on the big picture, not the numbers
  • Reach beyond existing demand
  • Overcome key organizational hurdles
  • Build execution into strategy
The Fifth Discipline” series of book written by Peter Senge was published in 1990th, is all about learning. As applied in the “learning organization":
  • System Thinking: Break problems down and see things laterally and sequentially.
  • Personal Mastery:  “Organizations learn only through individuals who learn,” says Peter Senge. As “approaching one’s life as a creative work"
  • Mental Model: We must seek divergent views before developing a convergent conclusion.
  • Shared Vision: “The strategy plan will not energize us, vision does"
  • Team Learning: People continually expand their capacity to create the results they truly desire in “Learning Organization”

3.  The Purpose of Strategy

All the strategy models discussed above are conceptualized leadership essentials, yes, it's a light to guide you up, not a hand to walk you through. As someone famously said that strategy is about shaping the future, and the future is more about progress and evolution.

Perspective: Chaos is a perception, if an opponent uses chaos in his strategy, it can be very effective and difficult to predict and counter, In strategy it is important to see distant things as if they were close and to take a distanced view of close things, as Miyamoto perceived. 

  • Position: All strategy models articulate the need for accurate intelligence of  “terrain” or creating a strong position for product or service that allows it to garner outsized profits, makes significant influence in contemporary business society
  • Plan: Well planning is more than half way of success. As Clausewitz well put, plans should cover every aspect of the conflict, weaving them into a single operation with an ultimate objective. 

4.  Why Strategy Fails & How to Make a Good One?
          
  • . Change is Accelerated: At today’s rapidly change business environment, one can't help wondering whether selecting and sustaining a strategy is not as relevant as gathering, assembling and understanding the information about the progress a business is making with a particular strategy.  Change is accelerated, modern business is heading off with a particular strategy in the face of growing information that suggests they should be revisiting the strategy.
  • Good Strategy, Bad Strategy: The book: Good Strategy/Bad Strategy: The Difference and Why It Matters, by Richard P. Rumelt well articulated the most basic idea of strategy which is the application of strength against weakness. The good strategy need include actions.

 Three-Step Strategy Making:
1) Figuring out the nature of the business challenge
2) Designing a guiding policy that produces an advantage
3) Creating a set of coordinated actions to carry out that policy.

The world and global history that clearly show how to recognize the good, reject the bad and make good strategy a living force in the organization


 5. Mirror, Mirror, What is Best Strategy

All these great leaders: Rumelt, Paton, Sun Tzu, Clausewitz, and Porter have one thing in common. They all understood that over-reliance on any particular approach to strategy is dangerous. The modern theories of strategy systematically deal with issues connected with organizational structure and psychology, anthropology and sociology, and also with all internal and external elements of the organizational environment. One size doesn’t fit all.

What is best strategy, the mirror answers:

The location makes the dwelling good.
The depth of understanding makes the mind good.
A kind heart makes the giving good.
Integrity makes the government well.
Accomplishments make your labors good.
Proper timing makes a decision good
-LAO TZU  "TAO TE CHING

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