100 Top Quotes From Good Strategy, Bad Strategy
Good Strategy, Bad Strategy is a thought-provoking and well-researched book that redefines the way we perceive and approach strategy. Richard P. Rumelt, a renowned strategy scholar, challenges the prevalent misconception that strategic planning is just a collection of goals and wishful thinking. Instead, he dissects the components of good strategy, emphasizing the importance of a clear and unique vision, a deep understanding of the current situation, and coherent actions that align with the set objectives.
Through real-world case studies and historical examples, Rumelt exposes the flaws of ineffective strategies that are often based on flimsy aspirations and buzzwords. By providing a comprehensive framework for crafting good strategy, this book becomes an indispensable guide for leaders, managers, and entrepreneurs seeking to navigate complexity and uncertainty to achieve lasting success in both business and life. (Good Strategy, Bad Strategy Summary).
Good Strategy, Bad Strategy Quotes
"Good strategy works by focusing energy and resources on one, or a very few, pivotal objectives whose accomplishment will lead to a cascade of favorable outcomes.” (Meaning)
"It is hard to show your skill as a sailor when there is no wind.”
"The kernel of a strategy contains three elements: a diagnosis, a guiding policy, and coherent action.”
"A strategy coordinates action to address a specific challenge.”
"A strategy is like a lever that magnifies force.”
"A leader’s most important job is creating and constantly adjusting this strategic bridge between goals and objectives.”
"Bad strategy is long on goals and short on policy or action. It assumes that goals are all you need. It puts forward strategic objectives that are incoherent and, sometimes, totally impracticable. It uses high-sounding words and phrases to hide these failings.”
"The discipline of analysis is to not stop there, but to test that first insight against the evidence.”
"Strategy is visible as coordinated action imposed on a system."
"The first step of making strategy real is figuring out the big ‘aha’ to gain sustainable competitive advantage—in other words, a significant, meaningful insight about how to win.”
"The most basic idea of strategy is the application of strength against weakness. Or, if you prefer, strength applied to the most promising opportunity.”
"A hallmark of true expertise and insight is making a complex subject understandable. A hallmark of mediocrity and bad strategy is unnecessary complexity—a flurry of fluff masking an absence of substance.”
"Strategies focus resources, energy, and attention on some objectives rather than others. Unless collective ruin is imminent, a change in strategy will make some people worse off. Hence, there will be powerful forces opposed to almost any change in strategy. This is the fate of many strategy initiatives in large organizations.”
"A good strategy includes a set of coherent actions. They are not “implementation” details; they are the punch in the strategy. A strategy that fails to define a variety of plausible and feasible immediate actions is missing a critical component.”
"At the core, strategy is about focus, and most complex organizations don’t focus their resources. Instead, they pursue multiple goals at once, not concentrating enough resources to achieve a breakthrough in any of them.”
"Without constant attention, the design decays. Without active maintenance, the lines demarking products become blurred, and coherence is lost.”
"If you fail to identify and analyze the obstacles, you don’t have a strategy. Instead, you have either a stretch goal, a budget, or a list of things you wish would happen.”
"A design-type strategy is an adroit configuration of resources and actions that yields an advantage in a challenging situation. Given a set bundle of resources, the greater the competitive challenge, the greater the need for the clever, tight integration of resources and actions. Given a set level of challenge, higher-quality resources lessen the need for the tight integration of resources and actions.”
"Unlike a stand-alone decision or a goal, a strategy is a coherent set of analyses, concepts, policies, arguments, and actions that respond to a high-stakes challenge.”
"Good strategy requires leaders who are willing and able to say no to a wide variety of actions and interests. Strategy is at least as much about what an organization does not do as it is about what it does.”
"Mistaking goals for strategy. Many bad strategies are just statements of desire rather than plans for overcoming obstacles.”
"Nevertheless, the doctrine that one can impose one’s visions and desires on the world by the force of thought alone retains a powerful appeal to many people. Its acceptance displaces critical thinking and good strategy.”
"The core of strategy work is always the same: discovering the critical factors in a situation and designing a way of coordinating and focusing actions to deal with those factors.”
"The best answer to this puzzle is that the real surprise was that such a pure and focused strategy was actually implemented. Most complex organizations spread rather than concentrate resources, acting to placate and pay off internal and external interests. Thus, we are surprised when a complex organization, such as Apple or the U.S. Army, actually focuses its actions. Not because of secrecy, but because good strategy itself is unexpected.”
"Bad strategy is the active avoidance of the hard work of crafting a good strategy.”
"When someone says “Managers are decision makers,” they are not talking about master strategists, for a master strategist is a designer.”
"Strategic coordination, or coherence, is not ad hoc mutual adjustment. It is coherence imposed on a system by policy and design. More specifically, design is the engineering of fit among parts, specifying how actions and resources will be combined.”
"To obtain higher performance, leaders must identify the critical obstacles to forward progress and then develop a coherent approach to overcoming them.”
"Many people call the guiding policy “the strategy” and stop there. This is a mistake. Strategy is about action, about doing something. The kernel of a strategy must contain action.”
"Form of bad strategic objectives occurs when there is a scrambled mess of things to accomplish—a “dog’s dinner” of strategic objectives.”
"Strategy cannot be a useful concept if it is a synonym for success. Nor can it be a useful tool if it is confused with ambition, determination, inspirational leadership, and innovation.”
"If the challenge is not defined, it is difficult or impossible to assess the quality of the strategy. And if you cannot assess a strategy’s quality, you cannot reject a bad strategy or improve a good one.”
"The main impediment to action is the forlorn hope that certain painful choices or actions can be avoided—that the whole long list of hoped-for “priorities” can all be achieved.”
"In a changing world, a good strategy must have an entrepreneurial component. That is, it must embody some ideas or insights into new combinations of resources for dealing with new risks and opportunities.”
"Good strategy and good organization lie in specializing on the right activities and imposing only the essential amount of coordination.”
"We should seek coordinated policies only when the gains are very large. There will be costs to demanding coordination, because it will ride roughshod over economies of specialization and more nuanced local responses.”
"The deeper meaning of focus—a concentration and coordination of action and resources that creates an advantage.”
"When a leader characterizes the challenge as underperformance, it sets the stage for bad strategy. Underperformance is a result. The true challenges are the reasons for the underperformance. Unless leadership offers a theory of why things haven’t worked in the past, or why the challenge is difficult, it is hard to generate good strategy.”
"Despite the roar of voices wanting to equate strategy with ambition, leadership, “vision,” planning, or the economic logic of competition, strategy is none of these. The core of strategy work is always the same: discovering the critical factors in a situation and designing a way of coordinating and focusing actions to deal with those factors.”
"A strategy is, like a scientific hypothesis, an educated prediction of how the world works.”
"A good strategy honestly acknowledges the challenges being faced and provides an approach to overcoming them.”
"Design always involves a certain amount of trial and error, and hardware trials and errors are much more costly.”
"Simply being ambitious is not a strategy.”
"The language of business strategy: identify your strengths and weaknesses, assess the opportunities and risks (your opponent’s strengths and weaknesses), and build on your strengths.”
"Strategy is the craft of figuring out which purposes are both worth pursuing and capable of being accomplished.”
"The kernel of strategy—a diagnosis, a guiding policy, and coherent action—applies to any complex setting.”
"Concepts and actions were in conflict rather than being coherent.”
"Many effective strategies are more designs than decisions—are more constructed than chosen.”
"Scientists had worked up three or four theories about how the moon was formed. The lunar surface might be soft, the powdery residue of eons of meteoric bombardment.”
"Thought is not only power; it is also the form of all things. The conditions that we attract will correspond exactly to our mental pictures. It is quite necessary, then, that the successful business man should keep his mind on thoughts of happiness, which should produce cheerfulness instead of depression; he should radiate joy, and should be filled with faith, hope and expectancy"
"Put every negative thought out of your mind once and for all. Declare your freedom. Know no matter what others may say, think or do, you are a success, now, and nothing can hinder you from accomplishing your goal.”
"A strong leader must possess the insight and fortitude to make the necessary investments in each link of the chain.”
"A good strategy has coherence, coordinating actions, policies, and resources so as to accomplish an important end. Many organizations, most of the time, don’t have this. Instead, they have multiple goals and initiatives that symbolize progress, but no coherent approach to accomplishing that progress other than “spend more and try harder.”
"What is most important is that these individual’s visions became genuinely shared among people throughout all levels of their companies—focusing the energies of thousands and creating a common identity among enormously diverse people.”12”
"McCracken’s “grow by 50 percent” is classic bad strategy. It is the kind of nonsense that passes for strategy in too many companies. First, he was setting a goal, not designing a way to deal with his company’s challenge. Second, growth is the outcome of a successful strategy, and attempts to engineer growth are exercises in magical thinking.”
"A hallmark of true expertise and insight is making a complex subject understandable. A hallmark of mediocrity and bad strategy is unnecessary complexity—a flurry of fluff masking an absence of substance.”
"It seems obvious in hindsight. Both the rise of software’s importance and the computer industry’s deconstruction had a common cause: the microprocessor. Yet these connections were far from obvious in the beginning. Everyone in high tech could see the microprocessor, but understanding its implications was a much more difficult proposition.”
"Fluff is superficial restatement of the obvious combined with a generous sprinkling of buzzwords.”
"In general, to change the group’s norms, the alpha member must be replaced by someone who expresses different norms and values.”
"Just as in a large university, the breakthroughs of a tiny number of very talented individuals had been used to justify a contemplative life for thousands of others.”
"One manager was puzzled and asked if it wasn’t also expensive to create software. He went on to rhetorically ask “Are software engineers less expensive than hardware engineers?”
"All too much of what is put forward as strategy is not. The basic problem is confusion between strategy and strategic goals.” With regard to the recent editions of the national security strategy, it said “when you look closely at either the 2002 or 2006 documents, all you find are lists of goals and sub-goals, not strategies.”
"Behind almost all of these forces and events lay the indirect competitive logic that Marshall and Roche expressed in 1976: use your relative advantages to impose out-of-proportion costs on the opposition and complicate his problem of competing with you.”
"Then developed more subtle and nuanced objectives. Anytime a company enters a new business or market, there is necessarily this cascade of adjusting and elaborating proximate objectives.”
"A design-type strategy is an adroit configuration of resources and actions that yields an advantage in a challenging situation. Given a set bundle of resources, the greater the competitive challenge, the greater the need for the clever, tight integration of resources and actions. Given a set level of challenge, higher-quality resources lessen the need for the tight integration of resources and actions.”
"It is often said that a strategy is a choice or a decision. The words “choice” and “decision” evoke an image of someone considering a list of alternatives and then selecting one of them. There is, in fact, a formal theory of decisions that specifies exactly how to make a choice by identifying alternative actions, valuing outcomes, and appraising probabilities of events. The problem with this view, and the reason it barely lightens a leader’s burden, is that you are rarely handed a clear set of alternatives."
"Quality matters when quantity is an inadequate substitute. If a building contractor finds that her two-ton truck is on another job, she may easily substitute two one-ton trucks to carry landfill. On the other hand, if a three-star chef is ill, no number of short-order cooks is an adequate replacement. One hundred mediocre singers are not the equal of one top-notch singer.”
"Good,” I say, and point out to everyone that Wal-Mart’s policies fit together—the bar codes, the integrated logistics, the frequent just-in-time deliveries, the large stores with low inventory—they are complements to one another, forming an integrated design. This whole design—structure, policies, and actions—is coherent.”
"We use the word “culture” to mark the elements of social behavior and meaning that are stable and strongly resist change.”
"I do not know whether meditation and other inward journeys perfect the human soul. But I do know that believing that rays come out of your head and change the physical world, and that by thinking only of success you can become a success, are forms of psychosis and cannot be recommended as approaches to management or strategy. All analysis starts with the consideration of what may happen, including unwelcome events. I would not care to fly in an aircraft designed by people who focused only on an image of a flying airplane and never considered modes of failure.”
"A word that can mean anything has lost its bite. To give content to a concept one has to draw lines, marking off what it denotes and what it does not. To begin the journey toward clarity, it is helpful to recognize that the words “strategy” and “strategic” are often sloppily used to mark decisions made by the highest-level officials. For example, in business, most mergers and acquisitions, investments in expensive new facilities, negotiations with important suppliers and customers, and overall organizational design are normally considered to be “strategic.”
"Success leads to laxity and bloat and this leads to decline. Few avoid this tragic arch. Only where there is starvation will you find a tightly crafted and integrated set of actions and policies.”
"A good strategy coordinates policies across activities to focus the competitive punch.”
"Our strategy was tuned to please the customer, not to deal with competition.”
"Paccar’s strategy is based on doing something well and consistently over a long period of time. That has created difficult-to-replicate resources: its image, its network of experienced dealers, its loyal customers, and the knowledge embedded in its staff of designers and engineers. This position and these kinds of slow-build resources are simply not available to companies, mesmerized by the stock market, who want big results in twelve months.”
"The proposition that growth itself creates value is so deeply entrenched in the rhetoric of business that it has become an article of almost unquestioned faith that growth is a good thing.”
"The idea that coordination, by itself, can be a source of advantage is a very deep principle. It is often underappreciated because people tend to think of coordination in terms of continuing mutual adjustments among agents. Strategic coordination, or coherence, is not ad hoc mutual adjustment. It is coherence imposed on a system by policy and design. More specifically, design is the engineering of fit among parts, specifying how actions and resources will be combined.”
"This particular pattern—attacking a segment of the market with a business system supplying more value to that segment than the other players can—is called focus. Here, the word “focus” has two meanings. First, it denotes the coordination of policies that produces extra power through their interacting and overlapping effects. Second, it denotes the application of that power to the right target.*”
"Bad strategy may actively avoid analyzing obstacles because a leader believes that negative thoughts get in the way. Leaders may create bad strategy by mistakenly treating strategy work as an exercise in goal setting rather than problem solving. Or they may avoid hard choices because they do not wish to offend anyone—generating a bad strategy that tries to cover all the bases rather than focus resources and actions.”
"A good strategy defines a critical challenge. What is more, it builds a bridge between that challenge and action, between desire and immediate objectives that lie within grasp.”
"Decentralized decision making cannot do everything. In particular, it may fail when either the costs or benefits of actions are not borne by the decentralized actors.”
"Resources are to coordinated activity as capital is to labor. It takes a great deal of labor to build a dam, but the dam’s services may then be available, for a time, without further labor. In the same way, Xerox’s powerful resource position—its knowledge and patents regarding plain-paper copying—was the accumulated result of years of clever, focused, coordinated, inventive activity. And, like a dam, once that well-protected resource position was achieved, it persisted for many years.”
"Were organizational inertia the whole story, a well-adapted corporation would remain healthy and efficient as long as the outside world remained unchanged. But, another force, entropy, is also at work. In science, entropy measures a physical system’s degree of disorder, and the second law of thermodynamics states that entropy always increases in an isolated physical system. Similarly, weakly managed organizations tend to become less organized and focused. Entropy makes it necessary for leaders to constantly work on maintaining an organization’s purpose, form, and methods even if there are no changes in strategy or competition.”
"Good strategy requires leaders who are willing and able to say no to a wide variety of actions and interests. Strategy is at least as much about what an organization does not do as it is about what it does. CHAPTER TWO DISCOVERING”
"Whatever you think about this definition of leadership, a problem arises when it is confused with strategy. Leadership and strategy may be joined in the same person, but they are not the same thing. Leadership inspires and motivates self-sacrifice. Change, for example, requires painful adjustments, and good leadership helps people feel more positively about making those adjustments. Strategy is the craft of figuring out which purposes are both worth pursuing and capable of being accomplished.”
"A good strategy has coherence, coordinating actions, policies, and resources so as to accomplish an important end.”
"When another person speaks you hear both less and more than they mean. Less because none of us can express the full extent of our understanding, and more because what another says is constantly mixing and interacting with your own knowledge and puzzlements.”
"Taylor’s assignment was to think through the intersection between what was important and what was actionable.”
"That uneasy sense of ambiguity you feel is real. It is the scent of opportunity.”
"Like the guardrails on a highway, the guiding policy directs and constrains action without fully defining its content. Good guiding policies are not goals or visions or images of desirable end states. Rather, they define a method of grappling with the situation and ruling out a vast array of possible actions.”
"Social herding presses us to think that everything is OK (or not OK) because everyone else is saying so. The inside view presses us to ignore the lessons of other times and other places, believing that our company, our nation, our new venture, or our era is different. It is important to push back against these biases. You can do this by paying attention to real-world data that refutes the echo-chamber chanting of the crowd—and by learning the lessons taught by history and by other people in other places.”
"Not miscalculation, bad strategy is the active avoidance of the hard work of crafting a good strategy. One common reason for choosing avoidance is the pain or difficulty of choice. When leaders are unwilling or unable to make choices among competing values and parties, bad strategy is the consequence. A second pathway to bad strategy is the siren song of template-style strategy—filling in the blanks with vision, mission, values, and strategies. This path offers a one-size-fits-all substitute for the hard work of analysis and coordinated action. A third pathway to bad strategy is New Thought—the belief that all you need to succeed is a positive mental attitude. There are other pathways to bad strategy, but these three are the most common. Understanding how and why they are taken should help you guide your footsteps elsewhere. THE”
"The whole semiconductor industry coordinated around achieving a higher level of integration, based on smaller transistors, about every eighteen months. This rate of progress was called Moore’s law. No one could jump much ahead of this pace because all the technologies, from photolithography to optical design to metal deposition to testing, had to advance in lockstep. The industry called this pattern of collective advance the “road map.”
"When organizations are unable to make new strategies—when people evade the work of choosing among different paths into the future—then you get vague mom-and-apple-pie goals that everyone can agree on. Such goals are direct evidence of leadership’s insufficient will or political power to make or enforce hard choices. Put differently, universal buy-in usually signals the absence of choice.”
"Good strategy works by focusing energy and resources on one, or a very few, pivotal objectives whose accomplishment will lead to a cascade of favorable outcomes. One form of bad strategic objectives occurs when there is a scrambled mess of things to accomplish—a “dog’s dinner” of strategic objectives.”
"Of course, it turned out that there is no more reason for one company to own networks all over the world than there is for UPS to own all the roads on which its trucks travel.”
"Rather, the term “strategy” should mean a cohesive response to an important challenge.”
"Quality matters when quantity is an inadequate substitute.”
"The introductory topic taught in any modern course on business strategy is the connection between industry structure and profit. This topic is usually called the “Five Forces,” following Michael Porter’s pioneering analysis of industry structure, published in 1980. A quick summary is that a terrible industry looks like this: the product is an undifferentiated commodity; everyone has the same costs and access to the same technology; and buyers are price sensitive, knowledgeable, and willing to switch suppliers at a moment’s notice to get a better deal.”
"A good strategy does more than urge us forward toward a goal or vision. A good strategy honestly acknowledges the challenges being faced and provides an approach to overcoming them.”
"The first step of making strategy real is figuring out the big ‘aha’ to gain sustainable competitive advantage—in other words, a significant, meaningful insight about how to win.” Yes, Welch believed in stretch, but he also said “If you don’t have a competitive advantage, don’t compete.”
"Strategy is about how an organization will move forward.”
"Any coherent strategy pushes resources toward some ends and away from others. These are the inevitable consequences of scarcity and change.”
"Quality matters when quantity is an inadequate substitute. If a building contractor finds that her two-ton truck is on another job, she may easily substitute two one-ton trucks to carry landfill. On the other hand, if a three-star chef is ill, no number of short-order cooks is an adequate replacement. One hundred mediocre singers are not the equal of one top-notch singer. Keeping children additional hours or weeks in broken schools—schools that can neither educate nor control behavior—does not help and probably increases resentment and distrust.”
"McCracken’s “grow by 50 percent” is classic bad strategy. It is the kind of nonsense that passes for strategy in too many companies. First, he was setting a goal, not designing a way to deal with his company’s challenge. Second, growth is the outcome of a successful strategy,”
"Nevertheless, strategy is primarily about deciding what is truly important and focusing resources and action on that objective. It is a hard discipline because focusing on one thing slights another.”
"A strategy is a way through a difficulty, an approach to overcoming an obstacle, a response to a challenge. If the challenge is not defined, it is difficult or impossible to assess the quality of the strategy. And if you cannot assess a strategy’s quality, you cannot reject a bad strategy or improve a good one.”
"If you have a special skill or insight at removing limiting factors, then you can be very successful.”
― Quotes from the book Good Strategy, Bad Strategy by Richard Post Rumelt
Good Strategy, Bad Strategy Author
Richard Post Rumelt is a distinguished scholar and strategist in the field of business management. As a professor at UCLA Anderson School of Management and a consultant to various corporations, he has left an indelible mark on the theory and practice of strategic management. His seminal book, "Good Strategy Bad Strategy: The Difference and Why It Matters," challenges the misconceptions about strategy and provides a clear framework for crafting effective strategies. Rumelt emphasizes the importance of identifying critical challenges, developing a coherent plan, and leveraging available resources to achieve a competitive advantage. He skillfully dissects real-world examples to illustrate the attributes of good and bad strategies, helping readers distinguish between mere wishful thinking and a well-structured roadmap to success. With an unwavering focus on substance and practicality, Rumelt's work has become a guiding light for executives, entrepreneurs, and anyone seeking to navigate the complexities of strategic decision-making.
Chief Editor
Tal Gur is an author, founder, and impact-driven entrepreneur at heart. After trading his daily grind for a life of his own daring design, he spent a decade pursuing 100 major life goals around the globe. His journey and most recent book, The Art of Fully Living, has led him to found Elevate Society.
