'Strategy' vs. 'Winning Spirit' Methods for Business Success

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An Economist magazine article titled ``The Planned and the Damned,'' reports on a surprising 75-company study about strategic planning by accountants Deloitte Haskins & Sells. The result: `` ... Firms without central planners tend to produce higher returns.'' Companies with central planning staffs, the researchers conclude, tend to diversify unwisely and are slow to shed misfit elements in their portfolios.

If not central planning in these turbulent times, then what? The search might begin, oddly enough, in the public sector. One of my first columns, February 1985, describes a dramatic turnaround of the U.S. Air Force's Tactical Air Command under Gen. Bill Creech, a prophet of ``de-organizing,'' as he called his approach to fighting bureaucratic, centralist tendencies.

In a public talk about the Tactical Air Command success, Deputy Assistant Secretary of Secretary of Defense Bob Stone proclaimed Creech's secret was to ``organize as we fight.'' Stone implied that Creech had executed a straightforward structural shift. ``Not so,'' Creech shot back. ``That's the cover I used to gain the Pentagon's acquiescence.'' The real purpose of the move, Creech vowed, was to ``organize in accordance with the human spirit,'' to build small-group cohesiveness and esprit in pursuit of effective execution.

This ``strategy/structure'' vs. ``spirit'' battle, as I now call it, also emerged during a recent overseas visit. I listened to the chief executive of one of Europe's mightiest companies analyzing the costs of his firm's ``petrified structure'' in the face of new, mostly Asian, competition. He contrasted the current sluggishness with the ``winning spirit'' that marked the company's sparkling post World-War II success. He discussed one major victory in the U.S. market, attributing it to ``work(ing) like an Olympic team.'' Restoration of such spirit, this highly analytic German concluded, was the key to future success, maybe even survival. Chalk up one more round for the ``spirit'' forces!

It was more than happenstance that these remarks were uttered while the Harvard Business Review (May/June 1989) was featuring a lead story titled ``Strategic Intent.'' Professors Gary Hamel and C.K. Prahalad argue that ``as `strategy' has blossomed, the competitiveness of Western companies has withered. This may be coincidence, but we think not. ... Did Komatsu, Canon and Honda have detailed, 20-year `strategies' for attacking Western markets? Are Japanese and Korean managers better planners than their Western counterparts? No. ... Companies that have risen to global leadership over the past 20 years created an obsession with winning at all levels ... and then sustained that obsession. We term the obsession strategic intent. …