CitationDownload as .RIS
Emerald Group Publishing Limited
Copyright © 2003, MCB UP Limited
The tools of discipline
Brian Leavy is AIB Professor of Strategic Management and former dean at Dublin City University Business School (firstname.lastname@example.org). His research is focused on strategic leadership, competitive analysis and supply chain strategy. The author of more than 40 articles on these topics, he has also published three books – Strategy and Leadership, 1994 (co-authored with David Wilson), Strategy and General Management, 1995 (co-edited with James S. Walsh) and Key Processes in Strategy, 1996 (and reprinted in 2001).
The Art and Discipline of Strategic Leadership
Mike Freedman with Benjamin B. TregoePublished by McGraw-Hill, 2003, 204 pp.
Dartmouth professor James Brian Quinn described the process of innovation as one of controlled chaos, an insight that has become famous. A similar paradox seems to lie at the heart of the strategy process, which might be characterized as "planned opportunism'' or "disciplined entrepreneurship''. Over the last two decades there is little doubt that the opportunistic, entrepreneurial side of strategy has been very much in favor, and planning has been out of vogue. Now in the wake of the rampant predatory opportunism that produced the Enron scandal, the pendulum looks set to swing toward a disciplined approach.
This is the expectation of the authors of The Art and Discipline of Strategic Leadership, a title that many may find misleading. In fact, it is not a guide to the "art'' of strategic leadership. In spite of a liberal use of such terms as "crafting'', "vision'' and "out-of-the-box'' thinking, it offers little insight into the intuitive or inspirational dimensions of strategic management or how really innovative, breakthrough strategies are developed. So it will not be Gary Hamel's cup of tea. That said, what the book does offer is a proven methodology for helping firms to regain strategic focus, coherence and alignment, and to develop a more solid platform for future growth. This is its real strength and one that will appeal to many CEOs in moderately dynamic industries, especially those who are taking over the reins after periods of lackluster performance and strategic drift. In short, what this book really delivers is a strategic planning template for firms seeking to re-establish their strengths.
This should not surprise us given its origins. The main author, Mike Freedman, is president of Kepner-Tregoe's (K-T) worldwide consultancy practice, and his collaborator is company founder, Benjamin Tregoe. K-T is the consultancy that produced The Rational Manager and its sequel, The New Rational Manager, and the firm was founded on "a commitment to the power of process in managing organizations'', as the new book points out. The book reflects its pedigree.
The template offered by the authors is a five-phase methodology for strategy development, situated within the overarching "model of the enterprise'' framework developed by K-T colleague Alan Brache in an earlier work, How Organizations Work: Taking a Holistic Approach to Enterprise Health (The methodology incorporates a self-assessment process). The five phases are: strategic intelligence gathering and analysis, strategy formulation, strategic master project planning, strategy implementation, and strategic monitoring, reviewing and updating. Reduced to a process list, it seems like the kind of top-down, linear approach that is emblematic of what critics call the "planning school'' of strategy, arguably the wrong methodology for today's dynamic environment. However, such criticisms are misguided because the true value of the book lies in the analytical tools that it offers in support of its methodology.
Tools for strategic focus
For example, the K-T approach starts with a working definition of strategy as the "framework of choices that determine the nature and direction of the organization''. Major outputs from the strategic intelligence gathering phase are the clear articulation of key assumptions about the competitive environment along with the core beliefs of the organization, with the latter helping to clarify the firm's own ethical boundaries to profit-seeking behavior. The authors warn that unless such a process is undertaken, companies and their top teams tend to go forward without a shared understanding of business priorities and core values.
Two concepts advanced to help with the formulation phase are the "driving forces'' of strategy and a "product-market directional matrix''. Companies are advised to base their strategies around one of eight generic driving forces: product (or service), markets served, low cost production, operations capability, method of sale (and/or distribution), technology, natural resources and return/profit. Not having one of these as the central driver of strategy is seen to be a recipe for confusion and dissipation of effort. Many companies will find the discipline of defining (or redefining) their main driving force to be very useful, particularly those with a pressing need to recover strategic focus and coherence. The product-market directional matrix is a K-T three-by-three variation on the Igor Ansoff classic, and a useful extension of the original. On the implementation side, the main tool offered is "strategic master project planning'', an execution methodology that plays to traditional K-T strengths in the project management area.
In its favor, the approach presented in the book is a comprehensive one for strategy development and execution that has been finessed in practice and proven to be effective in particular contexts. It provides tools for structured analysis, clarity of communication and controlled execution that should work well for many companies with conventional aspirations in industries with relatively stable technologies and low to moderate competitive dynamics. In a revealing section, the authors point out that "roughly half our clients see no significant value chain shifts as a result of the strategy engagement'' and a further quarter see shifts in emphasis, not radical departures.
The book's approach will appear to many to have much of the look and feel of the General Electric framework for strategic management prior to the Welch era – one that is formulaic, hierarchical and quite heavy on procedure. As such is its likely to be less appealing to firms in industry contexts where speed and agility are the keys to success, and "entrepreneurship'' is a pressing requirement. Moreover, while some readers will be able to extract much that is useful from the book and apply it judiciously in their own strategy processes, most organizations that practice this methodology are likely to need further direct support from K-T in order to secure full benefit.