5 Nov 2006

Why Do Good Managers Set Bad Strategies?

Michael E. Porter, director of Harvard's Institute for Strategy and Competitiveness in Knowledge@Wharton on corporate strategy. Not external factors such as consumer trends or technological change cause strategic errors:

"(...) I have come to the realization after 25 to 30 years that many, if not most, strategic errors come from within. The company does it to itself."

"Strategy is not something that is done in a bottom-up consensus process. The companies with really good strategy almost universally have a very strong CEO, somebody who is not afraid to lead, to make choices, to make decisions."

"Years ago, corporate strategy was considered a secret known only by top executives for fear competitors might use the information to their advantage, said Porter. Now it is important for everyone in the organization to understand the strategy and align everything they do with that strategy every day."

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