By Constantinos Markides
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Extra info for All the Right Moves: A Guide to Crafting Breakthrough Strategy
Such redefinition of the business is at the heart of strategic innovation, and it is truly remarkable how many of today's strategic innovators began their revolutionary journey by first redefining the business they were in. For example, Howard Schultz, president of Starbucks, does not believe he is in the coffee business. Instead, he is in the business of creating a consumption experience, of which coffee is a part. "10 If you are in the "experience" business rather than the coffee business, you will behave very differently from your competitors in the coffee business.
Given the important role that this "filter" plays in the development of strategy, it is only appropriate that managers give it considerable thought. The second ingredient of a superior strategic position resides in finding answers to the questions who, what, and how. Who should we target as customers? What products and services should we offer them? How should we do this in an efficient way? The questions of "who" and the "what" are essentially strategic; the answers to these questions will define the game the company will play.
A terrific definition for one company may be a terrible one for anotherit all depends on each company's unique capabilities and on which definition allows the company to employ its capabilities in the best possible way and thus gain competitive advantage relative to its competitors. As a quick demonstration of this simple truth, compare what Ted Levitt advised in "Marketing Myopia" with what Hermann Simon reported about successful German companies in his 1996 book Hidden Champions. S. railroad companies defined their business too narrowly.
All the Right Moves: A Guide to Crafting Breakthrough Strategy by Constantinos Markides