Good Strategy Bad Strategy by Dr. Richard Rumelt is one of the two most helpful books I have used in my work as an interim CEO for not for profit organizations. Published in 2011, it is a clearly written and practical volume, and draws on Rumelt’s years of consulting and teaching experience.
Developing and implementing a strategy is the central task of every leader, whether you are the leader of a national charity or a church pastor or the Executive Director of a local not for profit. What makes Rumelt’s book so useful is that he explains how a strategy is a set of integrated actions an organization should implement (or avoid!) as they drive forward in their Mission.
Many people assume that a strategy is a big-picture overall direction, divorced from any specific action. Rumelt makes it very clear that defining strategy as broad concepts, and leaving out action, creates a wide chasm between strategy and implementation. If you accept this chasm, most strategy work becomes wheel spinning. Indeed, as Rumelt points out, this is the most common complaint about strategy. A good strategy includes a set of coherent actions. They are not implementation details; they are the electricity that makes everything happen.
I once worked with a large national charity. They had a multi-year strategy but there was a huge problem of execution. They never paid any attention to the goals they had set for themselves (much less took specific action) because they were pursuing multiple objectives that were unconnected to each other and worse, conflicted with each other.
Rumelt reinforces through case studies that a strategy is not a single goal or a series of wish list objectives. Instead, it is the plan for action that is designed upon a unique set of attributes or conditions (he calls them kernels) that set an organization apart from its competitors in the same space (what he calls leverage) and results in sustainable revenues.
Rumelt outlines how to identify the kernel of a good strategy, how to identify and use leverage, and how to define and integrate your many objectives so that you can take action. It is a self -propelling process that allows you to use your advantages and common sense.
The kernel of a strategy, for example, contains three elements: a diagnosis, a guiding policy of problem – solution, and coherent action. The guiding policy specifies the approach to dealing with obstacles called out in the diagnosis. It is like a signpost, marking the direction forward but not defining the details of the trip. Coherent actions are coordinated policies, resource commitments and actions designed to carry out the guiding policy.
Finally, Rumelt shows that the heart of a good strategy is insight --- into the true nature of a situation and an appropriate response.
No matter how large or small the scope of your operations,
Good Strategy Bad Strategy is a book every not for profit leader should read before they contemplate their strategic plan. It shows you how to recognize the good, reject the bad, and make good strategy a living force in your organization.
Christopher Barry works as a consultant/interim CEO to support not for profit organizations experiencing revenue challenges and transformation
Author: Dr. Richard Rumelt
The publisher is Crown Business / Random House Inc in 2011