Search results

Recently, I was asked to be the technical editor for a book that purported to put in one volume all the knowledge gained from an MBA program. Since a typical MBA program requires two full years of study, this was an ambitious undertaking. Always up for a challenge, I decided to give it a look. First, I skimmed through the text. The section that caught my attention, and stopped me for a closer read, was the one on strategic planning.

One of the more contentious areas of corporate governance today is how active a company's board of directors should be in the development and execution of corporate strategy. While the spotlight is on public companies, private ones (and even not‐for‐profits) would do well to pay attention. Even though private companies and many non‐profits operate without the glare of public scrutiny, the core governance issues they must grapple with are essentially the same as their public brethren.

Last year I wrote a column about the potential for new rivals from outside companies' traditional competitive sets to mount surprise attacks. My key premise was that one of the old “givens” of strategy, that “you know your industry boundaries,” was fast falling by the wayside. The new strategic rule I suggested was: There are no industry boundaries.

Once while on business in Japan, I took some time off to study the local culture. At a famous Shinto shrine, I saw a gardener trimming a pine tree. He was using a pair of small garden scissors to cut the needles one at a time, referring to a small book before each cut. Coming from a part of the world where a chain saw is the tool of choice for tree trimming, I was intrigued.

There is an area on a golf club or tennis racket that players call the sweet spot. They know that if they swing and connect with the ball at that exact spot, they get the best possible results. That's very sweet, indeed.

In the last issue, I briefly outlined the history of strategy and promised, for this issue, my views on the strategy of the future. In the two issues immediately prior to the last one, I “presaged” those views when I argued that an accelerating technology adoption rate is forcing companies to make strategic decisions more quickly.

As a young economist graduating from college nearly 30 years ago, I would have laughed if someone had suggested to me that virtually every company in the U.S. would an “information management” company. But at the end of the 20th century, that now seems quite true.

The world around us is changing at lightning speed, and the most common words found in CEO statements about the future are: “We are unsure of our results going forward ….” Why, then, a column about history?

The idea of trade is almost as old as the world itself. Very early in the Agrarian Age, farmers grasped the concept that we now call “comparative advantage”; i.e., that some people or groups are more efficient than others in creating certain kinds of consumables, and that everyone benefits from specialization. Historians tell us that the result was that a new class of people, traders, grew amidst the mostly agrarian populace of 7,000 to 8,000 years ago. The first traders worked up and down the Nile River, bartering goods from one area to another.

In recent years, a great number of CEOs have discovered that their company's overall strategy and its information technology strategy are becoming more and more synchronous. For most of today's successful companies, everything from supply chain management to sales lead management is housed on an internal or external network. The company's technology decisions determine whether the overall strategy is possible, and the overall strategy determines the next technology move.