Your Strategy Needs a Strategy: How to Choose and Execute the Right Approach by Martin Reeves SUMMARY
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Strategy
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Orientation Cycle
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Your Strategy Needs a Strategy
Your Strategy Needs a Strategy: How to Choose and Execute the Right Approach by Martin Reeves. This is a complete summary of the book, wich explains and connects the key concepts of every chapter.
You think you have a winning strategy. But do you? Executives are bombarded with bestselling ide...
Your Strategy Needs a Strategy
How to Choose and Execute the Right Approach
Martin Reeves, Knut Haanæs, Janmejaya Sinha
Business Strategy is a means to an end and that desirable end is favorable business outcome. Inspired from military
strategy, for a long time annual or even multi-year business planning was the dominant approach to business strategy.
Unfortunately, long range planning is not relevant in all business environments and industries (globalization, rapid
technological development, economic interconnectedness, diversity and range of business environments →
Uncertainty, dynamism). But strategy has never been more important. In last 60 years, many of strategic frameworks
has emerged. The challenge for an organization is to carefully select right strategic approach for the right
circumstances.
Business Environment is the single most important criteria to select a business strategy. Markets and their
maturity, competition – none matter as much as the business environment for selection of business strategy.
This recommendation raises 2 questions:
1. How to evaluate and differentiate business environment?
2. Once business environment is classified, how to select the most effective strategic approach?
The answer to these two questions through a unifying framework: “The Strategy Palette”, a framework
that binds the business environment and strategic approach together in 5 archetypical approaches to
strategy. Leaders can match their approach to strategy to the circumstances at hand and execute it
effectively, combining different approaches to cope with multiple or changing environments and animate
the resulting collage of approaches.
➔ To select a strategic approach, business environments need to be classified on 3
dimensions: Predictability (can u forecast it?), Malleability (can you shape it?) and Harshness (can you
survive it?). These 3 dimensions are arranged in 5 distinct business environments, each requiring a distinct
approach to strategy and execution:
, 1. Classical
“I can predict it, but I can’t change it”. ARCHETYPE: Be Big
When the environment is predictable, and the basis of competition is stable; once acquired it is sustainable.
This is an approach suitable for long range planning and execution to build capabilities and sustainable
position in the market.
Advantage is achieved through comprehensive analysis of the competitive advantage and the fit between
the firm’s capabilities and the market and forecast how this will develop overtime (identify an attractive
position by delineating your market, it's boundaries and its segments). They construct a plan afterwards to
build and sustain advantage positions (paying close attention to short-term economic conditions and also
taking a long term strategic view of the company's development, creating a predictable plan) and finally
they execute it rigorously and efficiently (it needs to penetrate beyond the management committee and
cascade down and inform coordinated action throughout the organization).
• It’s the plan most economists and entrepreneurs are familiarized with.
2. Adaptive
“I can’t predict it, and I can’t change it”. ARCHETYPE: Be Fast
Recommend when business environment is neither predictable nor malleable. Long range planning and
building capability to take a position in this environment is putting all eggs in a single basket, something
that can jeopardize company’s future as the business environment and market dynamics can change quickly.
The recommended approach is to continuously vary approach by generating multiple strategic options,
continuous experimentation, selecting and scaling up most viable option in context of the environment.
• This approach is less cerebral than a classical one because advantage arises through the company's
continuously trying new things and not through it's analyzing, predicting and optimizing. Planning
does not work under conditions of rapid change and unpredictability.
3. Visionary
“I can predict it, and I can change it”. ARCHETYPE: Be First
Recommended when business environment is predictable and malleable. Visionary is an approach to
create new market or disrupt an existing one. In this approach, companies envisage new possibility, build
the new system, and scale the system to full potential. Though the environment may look uncertain to others
visionary leaders see a clear opportunity for the creation of a new market segment or they disruption of an
existing one, and they act to realize this possibility, building a new attractive market reality.
First visionary leaders envisage a valuable possibility that can be realized. Then they work single mindedly
to be the first to build it. Finally, they persist in executing on scaling the vision until its full potential has
been realized.
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