Idea in Brief
The Problem
Seemingly successful new companies struggle to turn a healthy profit. Established firms get disrupted by upstarts. Companies that excel at serving their markets can’t adapt when customers’ tastes shift.
The Root Cause
All too often business leaders focus on one element of strategy—such as identifying a golden opportunity presented by new technologies or building advantages that competitors lack. But they either ignore the other components of strategy or don’t recognize the components’ interdependencies.
The Solution
Take a holistic approach and craft a strategy that encompasses carefully coordinated choices about the business model, the competitive position, implementation processes that adapt constantly to the changing environment, and the capabilities needed to win in the long term.
The CEO’s job of crafting a strategy that creates and captures value—and keeps realizing it over time—has never been harder. In today’s volatile and uncertain world, corporations that have dominated their markets for decades can be blindsided by upstarts with radical new business models, miss the boat on emerging technologies, or be outflanked by competitors that are more adept at shaping consumer preferences. Young ventures can raise hundreds of millions of dollars, attract tens of millions of customers, and achieve lofty market valuations, only to collapse when they cannot figure out how to turn a profit or hold off imitators.
