Observing and working with a wide range of clients and networks over a long period, it seems to me that there are three foundations of strategy that appear time and time again, present in the successes, and absent in the failures.

  1. Differentiation. Clear, sustainable differentiation from competitors in a manner that customers value is the essence of strategy. Differentiation comes in many forms, superior product, service backup, design, marketing and distribution, and many activities, often seemingly mundane, but a part of the process of delivering value to customers.
  2. Simplicity. Successful enterprises are simple to the extent that everybody understands what they are doing, why, what role they play, and what constitutes success.
  3. Intellectual capital development. IC evolves from learning from mistakes and experiments, continuous improvement loops, communication feedback mechanisms,  cross functional, cross company, and increasingly cross geographic collaboration and behavior. All these things create a culture, a “way we do things around here” that becomes the driver of corporate DNA evolution, and the creation of Intellectual Capital. 

Strategy is probably the most commonly written about subject in management, scary to think its essence can be distilled into three simple headings.