Five practices of winning companies
Most companies fail to create a compelling strategy, or if they do have such a strategy they fail to put it into practice; however, a small number of companies naturally combine strategy and execution in everything they do. According to Paul Leinwand and Cesare Mainardi in their book Strategy That Works: How Winning Companies Close the Strategy-to-Execution Gap, the products and services of these companies have an enviable position in the markets they care about, and the firms reliably deliver on their promises. They each have their own unique way of competing, but they all have one thing in common: their success is clearly related to the distinctive way they do things: their capabilities.
The book goes on to describe the distinctive capabilities of a number of firms which have achieved unusual success in their fields, including Apple, CEMEX, Danaher, Frito-Lay, Haier, IKEA, Inditex, Lego, Natura, Qualcomm, and Starbucks. Through analysing these and other companies, the authors have come up with the “five acts of unconventional leadership”, which are the practices enabling the companies to win repeatedly:
- Commit to an identity: resolve to act in a distinctive and clearly differentiated manner
- Translate the strategic into the everyday: structure your organisation around implementation of your strategy
- Put your culture to work: use your organisation’s cultural strengths to enhance your strategy
- Cut costs to grow stronger: be ruthless about funding only initiatives which further your strategy
- Shape the future: create your own terms for the future of your industry, rather than trying to follow anybody else
Although the authors have clearly done a lot of research, the principles which they have distilled appear to be hypotheses supported by case studies, rather than statistically verifiable results of empirical research. Nonetheless, the principles seem to me to have a ring of truth. In my opinion, anyone who is responsible for the strategy of a company which seeks to achieve significant success would gain a great deal of insight and inspiration from reading this book.