Page 61 - HBR Leader's Handbook: Make an Impact, Inspire Your Organization, and Get to the Next Level

Developing a Strategy 51

What is a strategy?

We define strategy as a coordinated set of actions that organizations, di-
visions, and teams follow to win: to create distinctive value for customers,
differentiate their performance, beat out competitors, and move toward
the vision they’ve set. Leaders develop a strategy by guiding their people
through choices about where and how to compete for customers that are
better than their rivals’. (Our perspective here is indebted to seminal works
by Peter Drucker, A. G. Lafley, Roger Martin, and Michael Porter.)
Following a coordinated set of intentional actions is a reminder that
strategy is not accidental. Though companies and initiatives occasionally
thrive by being in the right place at the right time, enduring business suc-
cess requires that the group’s actions be deliberate. PBS KIDS 24/7 didn’t
simply fall into its new strategy; it was coordinated by Rotenberg and the
full team under Kerger’s leadership.
The phrase “where and how to compete” points to the kinds of options
and decisions you’ll sift through to develop strategic choices for your unit or
initiative. In creating products, services, or other business programs, you’ll
have to decide about particular arenas to focus on (e.g., customers in a cer-
tain geography, industry, or market space) and the way you’ll serve your
chosen customers (e.g., by offering some combination of benefits, pricing,
branding, additional support, etc.). For example, for their new initiative at
PBS, Rotenberg and the team chose to develop an offering for broadcast
and digital, and they also decided not to partner with other outlets, as they
had with Sprout.
The idea of choices is critical here, because, as Michael Porter famously
said, “Strategy is as much about what you decide not to do, as what you do
do.” The mark of a failing strategy is trying to be all things to all people—
and not having the courage of focus. The best strategies develop offerings
targeting some unique and defensible sweet spot—a winning blend among
multiple variables, for example, satisfying the needs of certain customers;
doing that with the right combination of product or service attributes at
the right cost; shaping the offerings on the basis of particular strengths of
your team; and doing it all in a way that makes it hard for competitors to