Summary for "What is Strategy?"
There are five chapters in this article so I will make one key idea for each chapter.
1.At the beginning, the author introduces a concept which is called Operational Effectiveness. It means performing similar activities better than the rivals perform them. Through applying the best available technologies and management methods, a company can improve its operational effectiveness thereby to reach the productivity frontier, a moment that constitutes the sum of all existing best practices at any given time. However, the author mentions that building competitive advantage through improving operational effectiveness is not a strategy because it doesn't differentiate from other companies. Every company in the same environment can achieve the productivity frontier through the best technology or resources. Therefore, simply improving operational effectiveness is insufficient.
2. Since a true competitive strategy is about being different, the author in this chapter start to illustrate how strategy can differentiate by positioning. The two example he uses, Southwest Airlines and Ikea, share a common point which is whey have a unique market positioning. Southwest targets the low-cost, short-haul airline market while Ikea chooses the low-cost, self service furniture market. so clearly positioning is an important factor for a strategy to succeed or not because it will help a company to find an unfilled needs of the customers in some certain markets. Strategic positions can be based on customers' needs, customers' accessibility, or the variety of a company's products or services, according to the author.
3. Choosing a unique position is not enough to be sure of a sustainable advantage because there will be imposters to follow the same positions. In order to prevent these imposters, barriers has to be made by trade-offs, meaning that more of one things necessitates less of another. Continental Airline is a good example here. On one...