Strategic Management and Business Policy

Assignment
Article Analysis: How to unleash your strategic thinking
BITS Pilani by Yuval Atsmon
Pilani|Dubai|Goa|Hyderabad
Group 76
Group Details - Group 76

S. No. BITS ID Student Name Participation Status

1. 2021MB21156 Alok Kumar Choudhary
2. 2021MB21410 Gaurav Kumar
3. 2021MB21176 Kurian George
4. 2021MB21388 Saravanakumar
5. 2021MB21065 Tarkeshwar Kumar
6. 2021MB21080 Ugvekar Vaibhav Fatu

Note : Participation status should be Active or Inactive or Partially Active

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Article: How to unleash your strategic thinking

Author : Yuval Atsmon

Period : May 2, 2017

Publication : McKinsey & Company

https://www.mckinsey.com/business-functions/strategy-and-corporate-finance/our-
insights/the-strategy-and-corporate-finance-blog/how-to-unleash-your-strategic-thinking

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Summary

Author of the Article, Yuval Atsmon is a senior partner in McKinsey’s London office seeks answers to below question with help of
popular references related to the subject:
“Can large corporations succeed by reducing conventional time-taking procedures and releasing the full scope of their
talent for thinking strategically?”.
It provides referrals from the following articles to provide valuable information.

To , 2016
Amazon Stakeholder McKinsey Papers By
Amazon business insights -2016 &
beyond Creative strategic McKinsey Market
thinking without an Research Team
While the letter focuses on Amazon's ideal all-encompassing
culture, its relevance goes beyond business and
top-down planning Published in 1978
contains useful insights for any organization that
strives to achieve an objective. regime could be very
effective.
From,
Jeff Bezos, Amazon CEO

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Learning from Article

Jeff Bezos' letter to Stakeholders

Bezos' letter mentions and compares two types of organizational cultures ("Day 1" and "Day 2”)

Day 1 culture companies are healthy and vibrant. Whereas the Day 2 culture companies fell victim to
stillness; they soon found themselves useless, followed by a slow death.
Day 2 is the Default Outcome as companies constantly face fierce competition in the market, if they do not
evolve, they will not survive.

Unfortunately for organizations, lack of relevance and decline are the default result given sufficient time. Yet,
Jeff Bezos provides us with some prescriptions that could help us avoid the risks of Day 2.

Bezos provides four approaches to maintain Day 1’s vitality:

Customer Adoption of external Skeptical view of High velocity

Obsession trends proxies decision-making

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How does an Organization keep Day 1’s culture?

Such a question can’t have a simple answer, says Jeff. And he went on to share a list of essentials for
Day 1 defense:
True
Customer
Obsession
1. Customer Obsession - In his view, obsessive
customer focus is by far the most protective of
Day 1 vitality
2. A skeptical view of proxies – Always ask, do we
own the process or does the process owns us? High Maintain
Velocity Resist
3. Embrace External Trends – If you fight the Decision Day 1’s Proxies
trends, you’re probably fighting the future
Making Vitality
4. High velocity decision-making – Speed matters in
business and we’ve to make high-quality, high-
velocity decisions
Embrace
external
trends

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The Four Rules of Strategic Thinking ( 40 Years ago)

Seeks hard, fact-based, logical information: Strategists should beware of vague concepts like ‘Soft
Synergy'. They should not agree with the general theories of economic behavior. They should seek an
impartial understanding of the dynamics underlying their cases
Questions everyone’s unquestioned assumptions: Creative strategic thinkers will be in search of
opportunities, where competitors see limitations.
Characterized by an all-pervasive unwillingness to expend resources: A strategist is always looking for
opportunities to earn at low cost or without cost.
Is usually indirect and unexpected rather than head-on and predictable. As unconventional and out of
the box approach at times lead to exceptional outcome.

Strategic Thinking

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Five management attributes Prevailed
by Successful Companies
In expanding the research, it was found that successful companies have managed to link strategic and
operational decision-making carefully and thoroughly in the absence of any process, with the prevalence of
five management attributes:
Strong Strategic Framework
• Designed for tomorrow’s strategic issues rather than by today’s organizational structure
• Sorts out the interrelated types of strategic issues

Overarching Strategic Thinking

• Thinking capabilities that are widespread throughout the company
• Not limited only for top management

Negotiating Trade-Offs
• Deploy scarce resources to create best returns

Robust Performance-Review System

• Focuses the attention of top managers on key problem and opportunity areas
• Avoids the struggle to go through in-depth review of each business unit’s strategy

Motivational System with Values

• Values should reward and promote the exercise of strategic thinking

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Mapping of learning to concepts learnt in the class

Sr no Concepts Learnt In class Learnings from Article

1 Strategy is about creating value: Strategic Jeff Bezos’ gives provides four approaches which
positioning means performing similar activities in focuses on how to deliver unique value to your
different ways Or performing different activities customers, individually and institutionally,
from rival’s.

2 Strategy is Not Operational Excellence Focus should be on creating a better customer

The productivity frontier is constantly shifting experience from the customer’s perspective. Customer
outward ``as new technologies, tools and needs should be at the center and everything else
techniques are developed should be built around these needs

3 Challenges to strategic management – Innovation Jeff Bezos; says that in today's fast-evolving world, we
implementation of potential innovations that truly can only go forward if you can test new and innovative
drives businesses to be remarkable trends or products at low cost

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Mapping of learning to concepts learnt in the class

Sr no Concepts Learnt In class Learnings from Article

4 Strategic Thinking – Next steps Strategy of Past leading Companies
5 Identifying patterns & relationships well-understood frameworks defining interconnected
strategic issues
6 Thinking creatively —Generating alternatives, visualizing Strategic thinking questions everyone’s unquestioned
new possibilities, challenging your assumptions assumptions

7 Analyzing information —Listing critical information while Strategic thinking seeks hard, fact-based, logical information
making a decision,
8 Prioritizing your actions —Staying focused on your Senior management conduct a focused review of key issues
objectives while handling multiple demands and competing and opportunities
priorities

9 Making trade-offs —Recognizing the potential advantages A process of negotiating trade-offs between competing
and disadvantages, making choices, balancing short- and objectives by comparing their initiatives to ensure scarce
long-term resources are producing the best returns.

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Conclusion

• Jeff Bezos’ letter encourages others to apply strategic thinking, which focuses on how to deliver
unique value to your customers, individually and institutionally. Further in doing so we should adopt
external trends with a strong bias towards action and the desire to avoid being burdened by
processes.
• The Author is of the opinion that no big business can completely avoid bureaucracy or rely entirely
on its middle managers to think strategically all the time, if not most of the time. However, it is rare
and refreshing to see large companies venture into something that was once more common, i.e.
unleashing and harnessing the full scope of their talent to think strategically.
• The rules and principles adopted for strategic planning in the past can be integrated into the formal
strategic planning process and will lead to extraordinary results.

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Application based questions
(not applicable for discussion questions)

1. How the "four Bezos approaches to maintaining day 1 vitality" or the four rules of strategic thinking can be applied
to the companies which are successful in current time.

2. As a leader of the large firm with multiple business vertical , how would you ensure to drive a culture of innovation
with a focus on client centricity and at the same time channelize multiple business units towards a common strategic
objective.

3. As a technology company leader , how would you ensure your products are technically advance which caters to
customers problem in a seamless manner with competitive pricing . Please share your understanding on how to
approach based on the methodologies discussed in the article.

4. As a leader of a firm and accountable for the overall business strategy , what are the tools/method you would
employ to ensure you inculcate the right mindset among groups to contribute/shape the organization strategy.

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References

• How do you unleash your strategic thinking: https://www.mckinsey.com/business-functions/strategy-and-

corporate-finance/our-insights/the-strategy-and-corporate-finance-blog/how-to-unleash-your-strategic-thinking
• Jeff Bezos’s 2016 Letter to Shareholders: https://noteworthynonsense.com/blog/08/2020/Amazon-Bezos-Letter-
Resist-Proxies#:~:text=Proxies%20are%20substitutes%20for%20more,focus%20to%20proxies%20than
%20outcomes.

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