Day 20 · Act IV — Lead the Organisation
Strategy and Competitive Advantage
Trade-offs · Porter · Value creation
~35 minutes
Strategy is the art of choosing what you will not be.
The Core Idea
Operational effectiveness — doing the same things better — is necessary but not strategy. Strategy is performing different activities, or similar ones differently, in a way rivals cannot easily copy.
Michael Porter argued that strategy requires trade-offs. A company trying to be everything to everyone ends up distinctive to no one.
The Mental Model
Porter's Five Forces
Industry profitability is shaped by rivalry, threat of new entrants, substitutes, buyer power and supplier power.
At work: A SaaS firm facing low switching costs (buyer power) builds integrations that raise them.
The Case Study
IndiGo's low-cost focus
DocumentedIndiGo became India's largest airline by market share, operating a largely single-family Airbus fleet.
Interpretation: a consistent set of operational trade-offs supported cost leadership and on-time positioning.
Cinema & Story
Ford v Ferrari (2019)
Competitive advantage requires focused bets — and leadership that protects the people making them.
The Reading Room
Good Strategy Bad Strategy
Richard Rumelt
How to tell real strategy (diagnosis, guiding policy, coherent action) from fluff.
Further reading: Competitive Strategy — Michael E. Porter
The Journal · Portfolio output: Strategic choice and trade-off statement
The Field Experiment · within 24 hours
Ask three colleagues to state your strategy in one sentence. Compare the answers.
The Evening Review
Choose, and accept the cost of choosing.