Strategy

Diagnosis is the starting point in creating a strategy.

it’s your job to know which tools—in which order—to apply in solving that for them.

In all cases, strategy is the process of confronting and solving critical challenges. I emphasize this because there is a widespread misconception that a business strategy is some sort of long-range sketch of a desired destination. I encourage you to think of strategy as a journey through, over, and around a sequence of challenges.

The guiding policy outlines an overall approach for overcoming the obstacles highlighted by the diagnosis. It is “guiding” because it channels action in certain directions without defining exactly what shall be done.

What we learned in studying those who succeeded in making this shift as well as those who failed is that for any process to work, it must acknowledge our doubts and build our confidence as much as unlock people’s requisite creativity with proven steps.

Effective strategy emerges out of an exploration of challenges, ambitions, resources, and competition. By confronting the situation actually being faced, a talented leader creates a strategy to further some elements out of the whole bundle of ambitions.

Good strategy works by focusing energy and resources on one, or a very few, pivotal objectives whose accomplishment will lead to a cascade of favorable outcomes.

I call this combination of three elements the kernel to emphasize that it is the bare-bones center of a strategy—the hard nut at the core of the concept. It leaves out visions, hierarchies of goals and objectives, references to time span or scope, and ideas about adaptation and change. All of these are supporting players. They represent ways of thi

Good guiding policies are not goals or visions or images of desirable end states. Rather, they define a method of grappling with the situation and ruling out a vast array of possible actions.