The strategy of information


Entrepreneurial strategy is about taking risks to pursue opportunity beyond resources currently controlled. Business strategy is more about not doing so, and limiting business actions so as not to lose a competitive position to a rival. For example, an entrepreneurial rival.

Reflecting on the word strategy, it comes from ancient greek stratgi, meaning "office of a general". Also stratos means army. A general has an army of resources to organise, even to recruit, train, operate and pay for. The army has to defend the country from enemies. In a military sense, strategy is distinct from tactics. A strategy is a longer term positioning of all a nation's forces to ensure security or victory. Whereas tactics deal with the use and deployment of troops in actual combat. A military environment contains strategic points, that is places or regions which afford an opportunity for their possessor to gain an advantage over his opponent. A mountain pass, a junction of rivers or roads, a fortress, the use of spies, outposts and scouts. Picture a strategic line joining strategic points. You have a potential advantage, a strategic vision, if you like.

In business, hundreds of activities are required to create, produce, sell, and deliver products or services. Each action is a source of cost and differentiation. Activities, then, are the basic units of competitive advantage. However, like the difference between military strategy and tactics, and as Porter says strategy is not simply operational effectiveness. Rather establishing a "strategic line" of selected actions creates a competitive position in an industry. The competitive advantage builds from the way each action either fits with others, or does not, forcing trade-offs between them. The essence of strategy is then choosing which actions not to do. It's the whole set of selected activities that makes up the competitive position as reducing cost or increasing differentiation. If there were no trade offs then a company could not achieve a sustainable advantage because everyone would copy each other (me too). Whereas the more a company's position rests on actions based on this strategic fit, this strategic line, the more difficult it is for rivals to untangle activities from outside the company, and therefore the harder it is to imitate, and the more sustainable the advantage.

Strategy is the creation of a unique and valuable position from the selection of actions. With a time horizon of a decade or more.

Some other things to think about may be:

Then within the industry:

Other ideas are:

Further concepts of strategic thinking: