“Good Strategy’s Non-Negotiables”

One of my favorite PodCasts is the Harvard Business Review’s IdeaCast. On March 15th Sarah Green interviewed Chris Zook, a partner at Bain & Company and co-head head of their strategy practice. In February 2012 he co-authored, with James Allen, a ‘must read’ book called Repeatability: Build Enduring Businesses for a World of Constant Change.

I’ve listened to the interview (link below as well) a few times now and just downloaded the book. I also transcribed the recording and then realized HBR does that for us (always learning!).

Over the last 20-25 years Bain & Company has observed 8,000 businesses and found that only 1 in 10 executives actually succeed in acheieving targets over time despite 9 in 10 saying they face adaquet opportunities in their business. Mr. Zook continues by sharing how with more analysis, Bain & Company was able to better understand why the 1 in 10 succeded. They found 3 enduring principles which they call ‘Design Principles of Enduring Strategies’:

1. “The presence of an extremely clear form of differentiation in your most important core business, uniqueness against your competitors so that it just really jumps out at you and hits you in the face.”

2. “The absolute ability to hard wire the key four, five, or six principles or ideas of the strategy.” “…all the way through the organization into front line routines using a small number of principles and beliefs that we’ve been calling the non-negotiables. And so the existence of these non-negotiables in a company and their use in driving the strategy, almost like the operating manual, a strategy to the front line…”

3. “Feedback loops and systems for learning around the four or five absolutely most important variables of the strategy that are really highlighted, that link to people’s pay perhaps, that are not necessarily financial measures.”

I’m going to get going on reading the book. You can buy it here: http://hbr.org/product/repeatability-build-enduring-businesses-for-a-worl/an/10761-HBK-ENG?referral=00134.

Here’s the link again to the interview:  http://blogs.hbr.org/ideacast/2012/03/good-strategys-non-negotiables.html