Thinking method · Rumelt, Good Strategy / Bad Strategy

Diagnosis, policy, action

The three parts a real strategy has, and whose absence makes one a list of hopes. Any plan longer than a page that has no sacrifice in it.

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The three parts a real strategy has, and whose absence makes one a list of hopes.

The steps

1. Diagnosis — what is actually going on? Name the crux of the difficulty, not the symptoms.
2. Guiding policy — the overall approach to that specific difficulty. What you will and will not do.
3. Coherent actions — steps that support each other rather than compete for the same resources.
4. Test: does it name a difficulty, and does anything get sacrificed? If not, it is a goal wearing a strategy costume.

When to use it

Any plan longer than a page that has no sacrifice in it.

What it will not do

A good diagnosis can still be wrong. It is at least checkable, which a list of aspirations is not.

Where it comes from: Rumelt, Good Strategy / Bad Strategy. Described in our own words.