Two lessons from Good Strategy Bad Strategy

Two of my favorite lessons from Good Strategy Bad Strategy by Richard Rumelt:

1. Strategy is a response to a situation.

The situation might be a technology inflection point. It might be that your business is in trouble. It might be strong competition. It might be a new market, a new business, or a new product.

But strategy is not a steady-state thing. It’s a reaction or a response to something that you’re fighting against.

2. Strategy must translate into specific action.

We all have finite time and resources, so you can’t afford to do things that are not aligned with your strategy. Even good ideas — perhaps ESPECIALLY good ideas which seem like “no-brainers” — should be avoided if they are not aligned with your strategy.

When I read Good Strategy Bad Strategy, I remember thinking that strategy requires making hard decisions and tradeoffs.

You can’t do everything.
You can’t serve everyone.
You can’t win on every dimension.

What will you choose?