According to Richard Rumelt in Good Strategy/Bad Strategy: “An especially insightful diagnosis can transform one’s view of the situation, bringing a radically different perspective to bear. Once I have an adequate (usually high level) ‘map of the territory’ to orient myself I concern myself with the task of Diagnosis. Rumelt identifies the elements of the kernel and includes examples that illustrate what an effective strategy really looks like. As a result I ended up with a completely different guiding policy and this triggered a radically different set of coherent actions.    Clearly other sources could be used to address other aspects. When a diagnosis classifies the situation as a certain type, it opens access to knowledge about how analogous situations were handled in the past…”. Why is it that so many customers are leaving us and going to our competitors? From “Good Strategy, Bad Strategy… - Good Strategy Bad Strategy, page 7. According to Richard Rumelt in Good Strategy/Bad Strategy: “An especially insightful diagnosis can transform one’s view of the situation, bringing a radically different perspective to bear. •Mistaking goals for strategy •Having a Long list of goals •No/Low on Guiding Policy/Coherent actions Strategy is about how an organization will move forward. As we engage stakeholders across the system in a participatory approach, sometimes just getting a “finalized” map and aligning around goals for our collective effort is a daunting enough ch… A good diagnosis simplifies the often overwhelming … Book Review, Analysis and Quotes: Good Strategy Bad Strategy by Richard Rumelt. So, overall a very satisfying experience as a facilitator and consultant. Written in an informal tone, the reader can immediately connect with the author. THE CULTURE CHANGE ZONE var t, js, fjs = d.getElementsByTagName(s)[0]; Diagnosis — A clear definition of the nature of the challenge. This was later confirmed by the x-rays.  Could we implement it?  If PR is our preferred channel for influencing the market where do we choose that is consistent with our policy on clients? Why is it that our sales folks are so much less effective in selling to our business customers?  Strategy is about thinking through what the problem that you are facing is and finding guiding policies and actions to address those challenges. A guiding policy. What is a 4th Generation Balanced Scorecard and do you need one? This post is about using the  approach in “Good Strategy Bad Strategy” to question, review and develop an organisation’s strategy. Set of Coherent Actions — The coordinated actions set out to accomplish the guiding policy. Why? }(document, "script", "twitter-wjs")); In this post I continue the conversation I started in the last post on the kernel of a ‘good strategy’. Guiding Policy — An overall policy or approach for overcoming the obstacles identified in the diagnosis. A diagnosis simplifies a complex situation and identifies certain aspects as critical. And because you should know the difference between what passes for strategy (‘bad strategy’) and real strategy (‘good strategy’).  If the actions are not consistent with the guiding principles, they should not be carried out as they won’t address the diagnosis of the problem. Join us, and you'll immediately receive the e-book The Top 5 Practices of Customer Experience Winners. Clears out the mumbo jumbo and muddled thinking underlying too many strategies and provides a clear way to create and implement a powerful action-oriented strategy for the real world Developing and implementing a strategy is the central task of a leader, whether the CEO at a Fortune 100 company, an entrepreneur, a church pastor, the head of a school, or a government official.  Were the executive team happy with the overall consistency? good strategy bad strategy the difference and why it matters Dec 06, 2020 Posted By Jackie Collins Public Library TEXT ID e60afe86 Online PDF Ebook Epub Library ironically that will make your work harder thankfully it will also increase your odds of success chapter summary for richard rumelts good strategy bad strategy the The main themes of our site and our consultancy work, Simply Phone UK +44 (0) 1780 784887 Tasks and actions. The concept of a kernel is important, as it serves as the core of any good strategy. Following Rumelt’s main ideas presented in the book, it is important to state that good strategies always have the ‘kernel’ that is the strategy’s structure including such components as a diagnosis, a guiding policy, and actions; and good strategies are always the result of identifying the power to overcome the problem in the organization. Experienced management consultant and customer strategist who has been grappling with 'customer-centric business' since early 1999. •Instead, you have either a stretch goal, a budget, or a list of things you wish would happen. What does this mean for customer experience (CX) and contact center leaders? The diagnosis is always linked to the ‘strategic issue’ that requires a strategy. Overall it was a thought provoking experience.  Strategies and options you might choose. It does not pop out of some “strategic management” tool, matrix, chart, triangle, or fill-in-the-blanks scheme. This means any diagnosis and every diagnosis in an ill-structured situation is an educated guess. Stepen Eloph who has shifted Nokia from independence to being reliant on Microsoft and its operating software for smartphones. And the grea… Or why is it that there is crisis around the Euro? Lets make this discussion real through a personal example. return window.twttr || (t = { _e: [], ready: function (f) { t._e.push(f) } }); 2. Our website uses cookies. By continuing, you are accepting cookies and our privacy terms. "Increase sales by 20%" is a goal without context or a plan. THE PARADIGM SHIFT ZONE  One noticeable feature was the frequent return to the stories and situations to ensure they were complete. Join now to get "The Top 5 Practices of Customer Experience Winners," an e-book of CustomerThink's latest research. Richard highlights a number of different ways we stumble when trying to create good strategy. So I was grappling with the question “What is going on here?”. Categories: Blog • Customer Strategy • Leadership This iterative process continued for 2-3 days as the team explored options, developed ideas,  sought counsel in evidence and material, discussed options among themselves.  What is the situation? DOWNLOAD: GOOD STRATEGY, BAD STRATEGY (Downloads are free to members of Azzarello Group) Learn about membership. You will find them (Apple, IBM) towards/at the end of this post. 3) Most importantly, it provides an elegantly simple (but not simplistic)set of three questions that you have to address to be strategic. This paper. b) Given the diagnosis of the situation, what guiding principles and policies should now be applied.  At this stage the analysis of each situation and the guiding principles designed to address those areas and focus resources were written up in a four page plan. A sound strategy consists of three key interdependent (and equally important) aspects. Examples include: Why are we signing up less and less customers through our website? Richly illustrated and persuasively argued by a researcher, teacher, and consultant, Richard Rumelt has authored the playbook for anybody in a leadership position who must think and act strategically. To wrap up, the parts to good strategy: Diagnosis; Choice (Author calls this guiding principles) Action (Author calls this coherent action) Learn more about good strategy: Good Strategy Bad Strategy: The Difference and Why it Matters, by Richard P. Rumelt. As a strategy consultant who has tried most strategic analysis approaches in his time, there are three reasons I like this book: 1) The first, it sticks a sharp pin in many of the supposed approaches to strategy that include having  passion,  mistaking goals for strategy, and a failure to face the  challenge of strategy. Improve strategic thinking, facilitation and alignment. And because you should know the difference between what passes for strategy (‘bad strategy’) and real strategy (‘good strategy’). The Kernel of Good Strategy. Ngân Trần. Download PDF. A good strategy that cannot be executed (i.e. You have entered an incorrect email address! minhngan nguyen. In Good Strategy/Bad Strategy, Richard Rumelt makes a two-fold contribution to the strategy literature – first he clearly distinguishes bad strategy from good and, secondly, he makes … The paradigm shifts that have changed how we view and manage our organisations today. Best Practices to Prove the Business Value of Customer Experience, Digital CX Opportunities to Kickstart the New Year, Hooked On Customers: The Five Habits of Legendary Customer-Centric Companies. Make strategy a learning process. And it struck me that it was an accurate and insightful diagnosis: most poor/disruptive behaviour is a result of poor relationships. A diagnosis: an explanation of the nature of the challenge. 1.  This started a process of iteration moving between: 1) What potential principles might we apply? Richard Rumelt, is one of the top business strategy experts in the world. It took another couple of days to work through the guiding principles. It continued to hurt for several days and we could not figure out why it was hurting.  In this case, a professional services firm, two useful sources of strategy options were David Maister’s work “Managing the professional services firm” and Treacy & Wiersema’s “The discipline of market leaders”. Save my name, email, and website in this browser for the next time I comment. Performance management and its culture has many forms…. Why? NHS: Focusing a Management team on what matters: their strategy. That is to say it is not obvious how to define the problem (the situation at hand) nor is there an obvious/sound list of guiding policies or actions. for dealing with the challenge. CustomerThink’s research finds just 19% of CX initiatives can show tangible benefits. Learn the best ways to prove the business value of CX, including ROI advice in customer feedback, customer service, and CX infrastructure. Members receive weekly Advisor newsletter with Editor’s Picks and Alerts of insightful content and events.  In contrast it was easy to fall into the trap of taking existing guiding policies for granted. Transform Your Business with Dr.Deming’s 14 Points, by Andrew Stotz, PhD, CFA  Unless you understand this you are not addressing a strategy. CustomerThink is the world's largest online community dedicated to customer-centric business strategy. Click OK to accept. The book demonstrates strategies from large corporations and his personal anecdotes.  Also, the concise, yet powerful guiding principles provide an excellent point of reference when working on any aspect of the strategy, for instance is the website approach consistent with the positioning and sales policies? He is a professor, consultant, and the best selling author of “Good Strategy Bad Strategy: The Difference and why it matters.”  Also a very effective tool as a client. 6 Steps to Successful Customer Onboarding, a Critical CX Activity that Most Companies Fail, Conversational AI in 2021: 3 top trends to look out for, Digitization, Digitalization, Digital Transformation – A Stake in the Ground, Reflections on the Causes of Lousy Customer Experiences, 7 steps to a successful customer experience program — and the ones everyone misses, 6 Ways to Support Your Remote Customer Service Team in 2021, The Impact of AI and the Empathy Economy on the Customer Service Experience, How Advertisers Are Using PPC To Improve Business Online, Why Trademark Search is Important & How to Perform It for Branding of Your Business, Once Upon a Time People Assisted One Another…. A short summary of this paper. In Good Strategy/Bad Strategy: The Difference and Why it Matters, Richard Rumelt argues that the essence of strategy is discerning the one or two critical issues in a business problem and concentrating effort on them.Developing a strategy requires making a clear diagnosis of the problem, defining an overall approach to solving it, and creating a set of mutually reenforcing coherent actions … “The kernel of a strategy contains three elements: a diagnosis, a guiding policy, and coherent action.” ― Richard Rumelt, Good Strategy/Bad Strategy: The Difference and Why It Matters Bad strategy lacks actions to take. If any of these elements are absent, it should raise warning signs about the validity a… I think “Good Strategy – Bad Strategy” by Richard Rumelt is one of the best books on strategy I have come across. “Good Strategy/ Bad Strategy pinpoints the polar difference: The diagnosis and actions that constitute good strategy, the fluff and failures that cause the bad. How to socialise your strategy. Ngân Trần. Richard Rumelt Good Strategy Bad Strategy The Difference and Why It Matters Crown Business. Good Strategy/Bad Strategy uses fascinating examples from business, nonprofit, and military affairs to bring its original and pragmatic ideas to life. Designed to carry out the guiding policy. Let me close by trying to give you a leg up in crafting good strategies, which have a basic underlying structure: 1. Strategy Maps and Strategy Mapping: An essential guide, Environmental Balanced Scorecards: Tracking, improving and influencing your impact, Input Output Outcome: Use the misunderstood Outcome Model successfully, Book: Strategy Mapping for Learning Organizations – Building Agility into your Balanced Scorecard, Book: Communicating Strategy – a practical guide, Our Consultancy is underpinned by extensive Research, Strategy Mapping for Learning Organizations – The Book. 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