The content of this book focuses on the transformation of Procter & Gamble (P&G) between 2000 and 2009, and discusses the approach to strategy that led to this transformation, leading to a doubling of sales, a quadrupling of profits, and an increased share price of more than 80 percent during that decade. The authors discuss that although many good strategic choices were made, the company also had its share of disappointments and failures. And most importantly, "no strategy lasts forever".
In my recent review of "Scenarios: The Art of Strategic Conversation (Second Edition)", by Kees van der Heijden, I mentioned that one of the best takeaways from what the author writes in that book is that "strategy is a highly dynamic area, full of fads and fashions that come and go", and that "copying ideas that 'work' for others is unlikely to be a winning strategy", because "success can only be based on being different from (existing or potential) competitors". The retrospective that Lafley and Martin provide in Appendix A would agree with these conclusions.
As explained by the authors, "strategies need continual improvement and updating", because as the authors have found, "competitors have copied P&G's strategies - on innovation, on branding, and the like - to an extent that renders P&G's resultant strategy less distinctive and decisive", and this is the challenge moving forward. In reflecting on its 175-year-plus history, the authors remark that "winning through distinctive choices is the always-and-forever job of every strategist", and if management continues to search for unique where-to-play and how-to-win choices that set the company apart, they should be able to further the success of the company.
Earlier in the text, the authors explain that many leaders tend to approach strategy in one of the following ineffective ways: (1) they define strategy as a vision, (2) they define strategy as a plan, (3) they deny that long-term (or even medium-term) strategy is possible, (4) they define strategy as the optimization of the status quo, or (5) they define strategy as following best practices. The authors argue that what really matters is winning, and that the play book discussed in this book, which provides five choices, a framework, and a process, is what is needed to win.
According to the authors, strategy is the answer to five interrelated questions: (1) What is your winning aspiration? (2) Where will you play? (3) How will you win? (4) What capabilities must be in place? and (5) What management systems are required? In chapters 2 through 6 of this book, the authors explain the nature of the choices to be made, provide a number of examples of each choice, and offer advice for making the choice given a context. These five choices comprise the "strategic choice cascade", the foundation of their strategy work.
In subsequent chapters, the authors present the "strategic logic flow" framework, designed to direct thinking to the key analyses that inform any strategy, and the "reverse engineering" methodology, designed to make sense of conflicting strategic options. In the former, there are four dimensions to be considered: (1) the industry, (2) customers, (3) relative position, and (4) competition. In the latter, which contrasts with traditional approaches to generating buy-in, there exist seven steps that involve exploring different ways forward and a wider variety of possible strategic choices.
As a consultant, I especially appreciated Chapter 1 ("Strategy = Choice"), which sets the stage by defining what strategy is all about, Chapter 7 ("Thinking Through Strategy"), which walks through industry analysis (segmentation and attractiveness), customer value analysis (channel and end consumers), analysis of relative position (capabilities and costs), and competitor analysis, and Chapter 8 ("Shortening Your Odds"), which explains that what is needed to find a winning strategy is to explore "what would have to be true" rather than "what is true", helping foster teams working together rather than battling one another, and surfacing differences and resolving them.
In addition, I appreciated the "Dos and Don'ts" sections at the end of each chapter, which clearly summarize the material from a practical context, as well as the strategic lessons learned side bars following these sections at the end of most of the chapters. At some level, I find the frankness that the authors share in these sections akin to how David H. Maister talks about his experiences in "Strategy and the Fat Smoker: Doing What's Obvious But Not Easy" (see my review), especially with regard to what Martin has to share at the end of Chapter 8 ("Shortening Your Odds"). Well recommended.