How could such talented executives produce such mediocre results? Tony Cram reviews a book which claims to offer some answers to strategic ills.
Like the rock band Coldplay, the business strategy gurus Michael Porter and Gary Hamel are on tour, doing gigs in Europe. And interestingly, the audiences for Hamel and Porter will be paying significantly more than Coldplay’s fans. Strategy is big business. Instead of CDs and downloads, strategy gurus write books of best practice. Just over 400 books on business strategy were published in the UK in 2005, more than a new book each day. There are journals, newspaper articles and a legion of websites expounding ideas in strategy. Talented executives are trained in strategy. American universities will turn out around 130,000 MBAs this year and UK business schools graduate around 10,000 MBA students annually. Directors and senior managers are attending high level strategy programmes like London Business School’s Developing Strategy for Value Creation, Insead’s Competitive Strategy and Ashridge’s Leading Strategy and Change.
From this illustrious range of strategic guidance, every business has derived and developed its favourite frameworks, models, strategic approaches and key success factors. Conceivably, “strategy” is the word most frequently appearing in titles of boardroom PowerPoint presentations.
But stand back for a moment. In this golden age of strategic wisdom, something isn’t working. Customers are less satisfied, profits are not growing and shareholders are being disappointed. To quote from Must-Win Battles by Peter Killing, Thomas Malnight and Tracey Keys, “how could we have such talented executives producing such mediocre results?”
In this book, Killing, Malnight and Keys of the Swiss business school, IMD, provide a solution. Their contribution to strategic thought is that success depends on focus and an organisation-wide commitment to that focus. Yet most businesses find that complexity jeopardises that focus with multiple product lines, customers in all categories, segments, markets and geographies. Every product, customer and market begets its own list of priorities. And year on year, these priorities multiply. Another month, another initiative. The corporate result is that the sole cross-functional initiatives are generic wish statements such as double-digit growth, cost-cutting and being more innovative.
The requirement is clear, and Must-Win Battles responds by looking at the process of establishing and agreeing just four or five battles you must win (MWBs). Lots of priorities are no priorities (write that down on a post-it note and stick it on your next set of board papers). In the authors’ view successful execution is specific and crossfunctional. They espouse a two phase approach. Phase I is a top management led cross-functional kick-off to discuss, debate and select the MWBs and the people who will lead each one. Phase II involves the motivation and mobilisation of the broader organisation behind the chosen MWBs.