The book 'Good Strategy, Bad Strategy' by Richard Rumelt explores several key themes. Firstly, it emphasizes the importance of clear and coherent strategy in business, distinguishing between good strategy that is direct and actionable, and bad strategy that is vague and undefined. Secondly, it discusses the concept of 'attractor states', which provide a sense of direction for the future evolution of an industry. Thirdly, it highlights the role of predictable biases in business decision-making, such as overprediction of current companies and business models. These themes are highly relevant to contemporary business issues, as they address the challenges of strategic planning, industry evolution, and decision-making biases in today's rapidly changing business environment.

Asked on the following book summary:

resource preview

Good Strategy, Bad Strategy

Even some of the world’s biggest organizations do strategy poorly, and incorrectly credit their success to personal decision-making skills. We read th...

Start for free ⬇️

Download, customize, and translate hundreds of business templates for free

Go to dashboard to download stunning templates

Download

book summary Preview

View all chevron_right

Question was asked on:

Raise fixed costs: the simplest form of transition is triggered by a substantial increase in fixed costs, such as when traditional pistons were replaced by more advanced jet engines, which leaves but a few competitors left able to pay for the added cost Deregulation: this can enable previously stretched competitors to become more involved with profit-making Predictable biases: biases include an inability to predict a dip in sales after continuously rising all-time highs; an overprediction of current companies and business models; and the advice from consultants and analysts that businesses should copy whatever the current largest player does Incumbent responses: expect resistance from incumbent companies when dynamics start to shift Attractor states: this provides a sense of direction for the future evolution of an industry, but such attractor states might not come to be.

Questions and answers

info icon

The lessons from "Good Strategy, Bad Strategy" can be applied to predict and manage biases in today's business environment in several ways. Firstly, understanding the concept of 'attractor states' can help businesses anticipate future industry trends and avoid biases in their strategic planning. Secondly, the book emphasizes the importance of not copying the strategies of the largest player in the industry, which can help businesses avoid the common bias of overpredicting the success of current companies and business models. Lastly, the book's insights on incumbent responses can help businesses manage biases by expecting and preparing for resistance when industry dynamics start to shift.

The book "Good Strategy, Bad Strategy" suggests that deregulation can have a significant impact on competitors. It can enable previously stretched competitors to become more involved with profit-making. However, it also implies that deregulation can lead to increased competition, which may result in a shift in industry dynamics. Incumbent companies may resist these changes. The book also introduces the concept of "attractor states", which provide a sense of direction for the future evolution of an industry, but these might not come to be.

View all questions
stars icon Ask another question