How to overcome strategic inertia, structural inertia and human inertia

When firms face profit pressures in the marketplace, most do not recognise it as a strategic problem; instead their first instinct is to try harder, attempting to do the wrong thing more efficiently, according to John Wells in his book Strategic IQ: Creating Smarter Corporations. In order to succeed in a changing world, firms need to overcome strategic inertia, structural inertia and human inertia to steer themselves into attractive places in the competitive environment.

The book is divided into three parts which discuss smart strategy, smart structure and smart minds. Much of what the author has to say about smart strategy will be familiar to those who have read other books on strategy. A distinction is drawn between firms with low strategic intelligence (those who are blind, in denial or incompetent), firms with moderate strategic intelligence (those that define and make strategic choices), and firms with high strategic intelligence (those with a mindset of change, continually finding new ways to succeed).

The book contains some interesting ideas about smart structure. Most organisations have a fairly rigid structure, leaving them vulnerable to competitive attack. The author advocates object-oriented organisational structures, with the organisation being made up of numerous strategic business components which can be easily rearranged, in a manner similar to agile object oriented computer programming.

There is an interesting discussion of the operation of social mechanics within an organisation. People naturally form social units, and organisations can make sure the conditions exist to encourage trust, reciprocity and altruism within work groups. Social networking technologies can be harnessed to help the social mechanics.

This book is a bit longer than many other business books and contains some repetition. Numerous companies are mentioned, but I would have preferred more detailed stories to make the text more engaging and paint a more vivid picture of how the espoused principles are put into practice. Nevertheless, the book contains a lot of insightful material, and it is well worth the time spent in reading it.

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