Playing to Win: How Strategy Really Works (Alan G. Lafley and Roger Martin, 2013)

 

Integrated cascades of choices

1. What is our winning aspiration?
• The purpose of the enterprise.
• Our guiding aspirations.
2. Where will we play?
• The right playing field.
• Where we will compete
• Geographies
• Product categories
• Consumer segments
• Channels
• Vertical stages of production
3. How will we win?
• Unique right to win.
• Value proposition.
• Competitive advantage.
• Low cost.
• Systemic understanding of costs/cost drivers.
• Relentless reduction of costs.
• Sacrifice of nonconforming customers.
• Commitment to standardisation.
• Differentiation.
• Deep and holistic understanding of customers.
• Intensive brand building.
• Jealous guarding of customers.
• Commitment to innovation.
4. What capabilities must be in place?
• Capabilities required to win.
• Reinforcing activities.
• Specific configuration.
5. What management systems are required?
• Support systems.
• Systems, structures, and measures required to support our choices.

Good strategy examples

• P&G
• Grow in core businesses and focus on core consumer segment.
• Extend leadership in laundry and home care.
• Expand to leadership in demographically advantaged emerging markets
• P&G core's capabilities
1. Understanding customers.
2. Creating and building brands.
3. Innovating (in broadest sense).
4. Partnering and going to market with customers and suppliers.
5. Leveraging global scale.

Core capabilities

1. What capabilities must be in place to win?
• Deep consumer understanding.
• Innovation.
• Brand building.
• Co-to-market ability.
• Global scale.
2. What management systems are required to support the strategic choice?

Strategy

• It is a choice and making choices.
• Multilevel strategy
1. Start at the indivisible level.
• The activity system would look more or less the same down 1 level.
• It looks meaningfully different up one organisational level.
2. Add competitive advantage to the level below.
3. Expand or prune the portfolio below to enhance competitiveness.
• OGSM framing structure
• Objectives
• Improve lives
• Goals
• x% growth annually
• Strategy
• Where to play
• How to win
• Measures
• Efficiency
• Consumer
• Retailer feedback
• Strategic options
1. Frame the choice
• Convert issues into at least 2 mutually independent options that might resolve the problems.
2. Generate strategic possibilities
• Broaden the list to ensure consideration of an inclusive list of possibilities.
3. Specify conditions
• For each possibilities, specify which conditions must hold true for it to be strategically sound.
4. Identify barriers to choice
• Determine which conditions you feel  least confident are true.
5. Design value tests
• For each key barrier, design a valid test sufficient for generating commitment.
6. Conduct tests
• Conduct hypothesis-driven analysis, testing the conditions with the lowest confidence first.
7. Choose
• Compare test results to key conditions, and make informed choices.
• Talltale of a winning strategy
1. A different activity system with competitors
2. Customers adore you
3. Competitors have their fair share of profits
4. More resources to spend than competitors
5. Competitors attack one another
6. Customers acknowledge you as innovation leader

Ineffective strategies

• Defining strategy as vision.
• Defining strategy as plan.
• Denying mid-term or long-term strategy.
• Defining strategy as the optimisation of the status quo.
• Defining strategy as following best practices.
• Temptations
1. Failing to choose.
2. Trying to buy your way out of an unattractive game.
3. Accepting an existing choice as immutable.
• Strategy traps
1. Do-it-all strategy: failing to make a choice
2. Don Quixote strategy: don't attack strongest competitor first
3. Waterloo strategy: wars with multiple enemies and fronts
4. Something-for-everyone strategy: attempts to capture all consumers
5. Dreams-that-never-come-true strategy: too high aspiration
6. Program-of-the-month strategy: setting same strategy as competitors