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Good Strategy/ Bad Strategy: The Difference and Why it Matters


In this short book of just under 300 pages, Richard Rumelt cuts through the crap to provide a clear distinction of what makes a good strategy. 

Recommendation: HIGH

Key Comment: A must read for any leader responsible for developing strategy

Good Strategy/ Bad Strategy is an easy read, written by Ricahrd Rumelt, Emeritus Professor of Business & Society at the University of California, Los Angeles (UCLA) Anderson School of Management. With fantastic stories from business, not-for-profit, and the military world, his examples of good and bad strategy bring to life the differences and counterbalance each other.
What’s unusual is the equal focus on bad strategy rather than what makes good strategy. I’ve always felt you learn more from failures than successes. Rumelt highlights the following issues with many of the strategies he’s seen:

1. Fluff – superficial statements of the obvious sprinkled with buzzwords
2. Failure to face the challenge (or problem)
3. Mistaking goals for strategy – a strategy is the pathway to higher performance.
4. Bad strategic objectives – distinguishing between and overall goal and actionable objectives

I particularly like his straightforward framework for developing good strategy. He breaks it down into three key components, which he calls ‘the kernel’:

1. A diagnosis: The information gathered explains the nature of the challenge faced, simplifying complexity to identify and prioritise the critical problems          the strategy needs to address
2. The guiding policy or framework: The overall approach to overcoming those obstacles identified in the diagnosis
3. A coherent set of actions: In essence, the high-level steps that will be implemented to achieve the guiding policy.

What’s different to most strategy definitions is that he embeds the initial phase of strategy implementation, developing a set of coherent actions, into the strategy itself rather than implementation being something separate.

If you are about to embark on developing a strategy yourself or your annual round of ‘strategic planning’ (which Rumelt describes as normally having little to do with real strategy, more long-range planning, and budgeting) – read this book before you start. It may change the way you approach it.
I thoroughly recommend Good Strategy/ Bad Strategy as one of the most important books on strategy!

Available at Amazon and Book Depository.

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