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 / Fourth Quarter 2001 / Issue 25(originally published by Booz & Company)


Best Business Books: Strategy

Von Clausewitz’s contemporary and rival Antoine-Henri de Jomini, on the other hand, saw actionable principles as central to any science of strategy. Regarded as the founder of the modern concept of strategy (as opposed to politics and tactics), de Jomini was the most widely read interpreter of Napoleon’s genius. He had a Platonist’s faith that behind the confusion and chaos of war were a few immutable scientific principles. The use of prescriptive principles appealed strongly to military educators, and de Jomini wrote for a wide audience that was eager to understand the “secret” of Napoleon’s success. Military ties between France and the fledgling United States had grown close during the War of Independence, and generations of West Point engineers had been trained by the “principles” approach. De Jomini’s influence remained strong in the military academies outside Germany until his reputation collapsed in the bloodbaths of the First World War. He had always insisted that his principles were independent of technology. In the American Civil War, when defenders had rifles instead of muskets, the Napoleonic principle of massed attack had proved merely expensive for the attacker. During the 1914–1918 war, against machine guns, it proved to be suicidal.

Schools of Strategy
The use of principles that simplify, reduce, and prescribe is an enduring feature of writings on business strategy. The writings of von Clausewitz and de Jomini outline a continuum between descriptive and prescriptive approaches to strategy. The Canadian management scholar Henry Mintzberg uses this distinction in Strategy Safari: A Guided Tour Through the Wilds of Strategic Management (1998), written with Bruce Ahlstrand and Joseph Lampel.

Mintzberg and his colleagues classify the voluminous writings on management strategy into 10 different “schools.” The first three of these, in order of their emergence, include the design school (mainly associated with Professor Ken Andrews and the Harvard Business School), the planning school, and the position school (of which Harvard’s Michael Porter is the best-known exponent). These schools are analytical and prescriptive. For example, H. Igor Ansoff’s Corporate Strategy: An Analytic Approach to Business Policy for Growth and Expansion (1965), the classic planning text, is full of complex flow diagrams. For those with the planning mind-set, strategy is formulated through a controlled, conscious, explicit process conducted by the CEO (and a group of planners) in a top-down, formal fashion and emerges fully formed from this process ready for implementation.

However, this classic planning approach to strategy suffered a deathblow in the 1970s when corporate icons like General Electric redeployed most of their specialist planning staffs. Ever since then, the rational, prescriptive views of the first three schools of strategy have been steadily augmented and supplanted by a number of descriptive approaches. Mintzberg sorts these into seven other schools, ranging from the entrepreneurial and the cognitive, to the learning, power, and cultural, to the environmental and configurational schools. The objective of these schools of strategy is not to instruct like de Jomini but to inspire the imagination like von Clausewitz.

An excellent example of the inspirational use of principles is Jim Collins’s Good to Great: Why Some Companies Make the Leap ... and Others Don’t (2001), the follow-up to his highly successful Built to Last: Successful Habits of Visionary Companies (1994), coauthored with Jerry I. Porras. (See “Climbing to Greatness with Jim Collins”) For Good to Great, Collins and his research team studied the financial records of 1,435 firms that belonged to the Fortune 500 from 1965 to 1995. They searched for firms that had produced mediocre (or worse) returns for 15 years and then had outperformed the market by a factor of three times or more for 15 years. They found only 11 such companies and labeled them “good to great.” This elite group consisted of Abbott Laboratories, Circuit City, Fannie Mae, Gillette, Kimberly-Clark, Kroger, Nucor, Philip Morris, Pitney Bowes, Walgreens, and Wells Fargo. Collins’s team then identified two comparison groups: a direct comparison group of companies in the same industries that had not improved their performance, and another group that had produced superior returns for a while, but had been unable to sustain that improvement. Collins and his team then studied the differences among the groups. Their findings are fascinating.

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