Strategy Bites Back

It Is Far More, and Less, Than You Ever Imagined

Henry Mintzberg, Bruce Ahlstrand and Joseph Lampel

Financial Times Prentice Hall 2005
304 pages

Focus
Leadership & Mgt.

Take-Aways
Learn how to be bold and creative in your strategic thinking.

Strategy
Sales & Marketing
Corporate Finance

Remember "SWOT:" manage your "Strengths;" cure your "Weaknesses," take your
"Opportunities, be aware of "Threats" and avoid them.

Human Resources
Technology & Production
Small Business
Economics & Politics
Industries & Regions

Once you gure out a solution, move ahead. Don't hesitate.

Getting people to buy your ideas is the ultimate goal of strategy.
In a new business venture, always have an exit strategy.

Career Development
Personal Finance

Keep the competition guessing. And when you have them on the run, nish them off.

Concepts & Trends

Rapid changes can spoil even the best strategic plans.

Don't get bogged down in the mundane and the routine.
Successful businesses need both leaders and managers.
Strategy will never take the place of really knowing your business.

Rating

(10 is best)

Overall

Applicability

Innovation

Style

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Relevance
What You Will Learn
In this Abstract, you will learn: 1) Why traditional business strategy frequently fails; and
2) How to x that problem.
Recommendation
Youve never read a business book quite like this one. Often with tongues planted rmly
in cheek, authors Henry Mintzberg, Bruce Ahlstrand and Joe Lampel tap a variety of
sources in illuminating the frequently nebulous topic of strategy. The essays, anecdotes
and quotes are unique, insightful and sometimes humorous. And the book is not just
nontraditional and cute: it also provides plenty of good, solid information on strategy.
getAbstract recommends that you go ahead and take a big bite. Chew slowly and savor
the avor. It goes down easy.

Abstract

Unlike buildings,
strategies do not
get nished. They
are works-inprogress, always
changing. So their
structures have to
be uid, their walls
permeable.

Strategic Thinking as Seeing

Some individuals have a special gift for being able to see what others cant. They are called
visionaries. They are able to go deep into a gold mine and wade through all the muck to
locate a shiny nugget that can be polished and perfected. Its hard work. Visionaries have
the ability to see in every direction, then conceptualize and formulate a plan of execution.
They know where they want to go and where theyve been. The key is not so much being
able to predict trends as it is anticipating just when old patterns will become obsolete. Of
course, visionary thinking is of little value if you are unable to execute your plans.
When visionaries allow their creative forces to take over, they do not view obstacles as
roadblocks, but merely as challenges. Once they solve the problem, they move forward
without hesitation. Consider a typical advertising campaign. Ad executives hunch over a
storyboard trying to come up with the perfect strategy to sell a car or a refrigerator. The
logos are eye-catching, the campaigns theme is slick and the client is enthusiastic. But as
long as the ideas are not executed, the vision will not come to life, so add action and stir.

The Entrepreneurial Spirit

Before entering an entrepreneurial venture, keep a few things in mind:
The healthy
organization does
not leap from one
hero to another;
it is a collective
social system
that naturally
survives changes
in leadership.

You are courting danger if you invest in an unfamiliar business. If sneakers and
sporting goods are your specialty, don't enter pharmaceuticals or become a day
trader. Stick with what you know.
Entrepreneurs are best served by doing their own research. Surveys and polls only
have so much value. Mind your business.
Don't fret if a potentially lucrative opportunity slips through your ngers. Another
one will be barreling down the turnpike any minute.
Taking on a partner helps limit your exposure if a venture tanks.
Always have an escape route if you undertake a risky business enterprise.
Never lose sight of the customer especially as your business grows. The personal
touch is what sets many businesses apart. Always maintain the basic fundamental
elements that have made your business a success.
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Managers dont
empower their
people. They
inspire them.
They create the
conditions that
foster openness
and release
energy. The queen
bee, for example,
does not make
decisions; she just
emits a chemical
substance that
holds the whole
social system
together.

The next time

your boss proudly
boasts that he is
off to a strategicplanning meeting,
give him your
condolences.

Visionaries are
easy to nd, not
like the planners
hidden away
in ofces.

A good deal of
forecasting is
akin to magic,
carrying a fruitless
obsession with
control into the
illusion of control.

If your research indicates that an investment is sound and you feel reasonably sure
about it, don't delay plunge right in. Hesitation can hit you hard in the pocketbook.

What Strategy?
Business plans can be valuable; nevertheless, many entrepreneurs y by the seat of
their pants. One study found that more than 40% of the founders of some of the U.S.s
fastest growing companies have no business plan. Only a small percentage had compiled
a nancial outlook for investors. These entrepreneurs dont bother with well-formulated
plans but that makes sense for them, because they move quickly in reaction to the shifts
and changes of an evolving marketplace. However, they also tend to take more chances
than traditional business leaders.
Strategy for Success
Although strategic planning is theoretically designed to inspire creativity and motivate
employees, it frequently results in creative paralysis. Strategic planning may empower
managers, but it can lessen the inuence of employees, even those who are most apt to
implement a plan. The salesperson who is in the eld every day, making contacts, may have
a much better idea of what the customer wants than the executive on the fourth oor who
is plotting pie charts on a blackboard. In many such ways, strategic planning is ultimately
in the hands of those who translate theories and concepts into reality. The folks in the
executive boardroom can extol the virtues of customer service, but that is meaningless
unless the cashier greets the customer with a smile and offers a helping hand.
Strategic planning is also uid and susceptible to change. A football coach may devise a
wonderful game plan, but it is useless if he realizes that his players arent performing well
or the opposition is proving resistant. So the coach adjusts his plan so his team can win.

Managing to Succeed
Good managers are never far removed from the operations of their organizations. Even
as forward-looking managers ascend the promotional ladder, they cultivate relationships
throughout the company, giving them access to different departments. This enables the
managers to contact a variety of individuals and get information. Managers who are
too far removed from daily operations may nd that lower department heads are more
intimately involved in decision-making than they are. Good managers pick and choose
their positions. Rather than micro-manage, they pinpoint the crucial issues that most
affect the organization and wield their inuence at those pivotal points. Good managers
know how to test the waters, and gure out in advance which individuals and departments
will be particularly receptive to their suggestions.
The most successful managers and CEOs are terric politicians. They discuss policy and
talk about where theyd like to see the company headed without personally taking a rm
position. The CEO of a cereal company might say, We want to sell more corn akes
than anyone else in the world, without revealing any specic strategies. Good managers
realize that the business world has many variables. Policy statements can be difcult to
reverse in the face of variable marketplace conditions or organizational changes, so they
guard their declarations.
Wise managers also know it is impossible to hit a home run every time. They may feel that
a particular program or policy should be instituted, but if they sense resistance, they will
settle for smaller victories like getting part of a proposal accepted. The important thing is
to get the program moving in a positive direction. Successful managers and executives tend
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to be proactive. Instead of dealing with theories and organizational charts, they move to
implement growth, even incrementally. Some small progress may create a chain reaction.
A conversation
with a single
disgruntled
customer can
sometimes be
worth more than
a big marketing
research project.

The business
with a high
market share
and slow growth
potential was to
be designated
a cash cow, so
that its prots
could be milked
and reinvested
in high-growth
businesses.

Business
strategies
designed with the
little black dress
model would
be simple in an
elegant way.

Theres a striking
relationship
between really
good strategies
and really strong
leaders.

The Future Is Now

How do companies make informed strategic decisions that result in increased prots or
wildly successful marketing? After all, no one has a denitive method for gauging the
mood of the marketplace or knowing whether consumers will be receptive to a particular
product. There are no guarantees in business. Good fortune almost always plays a key role,
in fact, truly innovative strategies are alwaysthe result of lucky foresight. But just as
educated blackjack or poker players can improve their odds of winning, good companies
can take fundamental steps to ensure that they have at least a ghting chance.
Effective strategy is not created in a vacuum. It must be an ongoing, integral part of
an organizations culture. Periodic strategic planning meetings probably will not yield
the desired results and even regular strategy sessions can be nonproductive if the same
individuals just recycle the same old ideas. Always welcome and encourage fresh voices
and opinions. Even if the sophisticates scoff at suggestion boxes, have one anyway. Many
companies have acted very productively based on the suggestions of front line workers.
Salespeople and customer service representatives frequently have their ngers directly
on the pulse beat of the marketplace.
Organizations choose between two approaches to inuence change: top-down transformation and bottom-up change. The former makes management responsible for identifying issues, assembling a cohesive and persuasive group to set a plan in motion, and
inspiring employees to carry out the vision. The latter empowers the workforce to locate
problems and gather other employees for a program that implements a solution. At that
point, management takes responsibility for activating the program. Imagine the energy you
could create if your employees believed they played a role in the companys future direction. The best companies are those where employees feel they have a stake in the future.
Ultimately, it all boils down to execution. You may have a strategic plan on paper, but
until you move forward, you wont know what will work or whether you will have to
make adjustments and alterations. Dont be afraid to try different new products or strategic
approaches. Pharmaceutical rms experiment with hosts of ingredients before devising
the best formula for treating a particular condition. Strategy will never be an exact science.
Build yours on the SWOT principle: focus on the Strengths of your company, x its
Weaknesses, grab your Opportunities and dodge the Threats all around you.

Playing by the Rules

Although you may need to alter your strategy, depending on your situation as in a chess
match that unfolds with uncertainty always heed strategys fundamental principles:
Be a master of disguise Keep your competition guessing. If you do not reveal your
intentions, your opponents may nd it difcult to establish a defense. Ideally, you will
coax them to take a right turn instead of a left. By the time they realize theyve been
duped, you will be too far ahead to catch. Be intentionally deceptive. Unpredictable
behavior will keep your opponents off guard and constantly guessing. That can be
quite frustrating and, ultimately, it will give you a signicant advantage.
Actions speak louder than words Yelling and screaming may be effective for the
football coach in the locker room at halftime, but its not very persuasive in a business
setting. Quietly demonstrating the strength of your position is better than arguing
and attempting to intimidate.
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Show me a chief
executive who
ignores yesterday,
who favors the
new outsider over
the experienced
insider, the quick
x over steady
progress, and Ill
show you a chief
executive who is
trying to destroy
an organization.

When it comes to
strategy, there are
no easy answers.
Except, of course,
to make sure
you understand
deeply what you
are strategizing
aboutand that
you have the
courage to see
with your own
eyes, think with
your own brain
and act with your
own heart.

Finish em off When you stagger your opponents and theyre up against the ropes,
deliver the nal crushing blow. An enemy not completely vanquished will almost
certainly rise again with even greater determination.
Dont be afraid to re the ship Fighting the good ght is admirable, but it may not
be wise to continue a losing battle. Surrendering allows you to cut your losses and
regain your strength for another assault. Meanwhile, your opponents may become
overcondent and more prone to expose their aws or weaknesses.
Know where you're going Whether youre a general who is planning a major
offensive in a foreign country or a CEO devising a marketing scheme for a new
product, you need to know your ultimate objective and how to get there. Preparation
allows you to overcome problems or unforeseen circumstances. If you are frantic or
unprepared, you are presenting your competition with an opportunity. Never seem
to be in a hurry; hurrying betrays a lack of control over yourself. Remain in control
or, at least, give that impression. As the ad says, Never let em see you sweat.
Change of speed One of the fastest ways to alienate people is to attempt radical
changes overnight. A new manager may realize that a department needs a major
overhaul, but moving too quickly could hurt morale and create additional, unexpected
resistance. Being new exacerbates this, because veteran personnel will view you
with suspicion. Respect tradition and established operating procedures, even if you
are convinced that change is imperative. Move slowly and carefully. Gather data and
other peoples input. Make them feel that their opinions matter. Dont steamroll.
No one likes a braggart Once you achieve your victory, remain humble. Resist the
temptation to rub it in. Sportsmanship applies in the business arena as well. Victory can
be heady and its easy to get carried away and become too full of yourself. Humiliated
opponents tend to have very long memories. What goes around does come around.

Killing Them Softly

Strategy isnt sexy at least not the way most businesses see it. Think about the typical
roll out of a strategic plan. Management reps call employees to the conference room where
they have mapped out this new strategic initiative on the ip chart. It all looks impressive.
The managers talk excitedly about change and the future. The employees have heard it all
before; they nod in silent agreement and shrug their shoulders. Strategy isnt worth a darn,
they think to themselves, if the company keeps cutting resources and not lling vacancies.
The managers who created the strategic agenda are the most enthusiastic and animated
people in the room. But, theyve failed to convince the populace. Business leaders should
be applauded for wanting to make positive changes. But their employees must share the
vision motivation cannot be manufactured. This is a signicant challenge since change
may require that people step outside of their comfort zones. Consequently, managers must
persuade employees to come along for the ride by focusing on potential and growth, and
not on difculties, obstacles and negatives. The landscape can be difcult to negotiate. But
if managers and employees can achieve a sense of unity, the possibilities are endless.

About The Author

Henry Mintzberg teaches management studies at McGill University and is the author
of more than 130 articles on strategy. He wrote Managers not MBAs. Bruce Ahlstrand
teaches management at Trent University in Ontario. Joseph Lampel is associated with
the Cass Business School, City University, London. They co-wrote Strategy Safari.
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