Strategy As Love, Not War

MIT Sloan School professor Arnoldo C. Hax, a well-known strategy expert, thinks companies need a different approach to thinking about strategy.

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Professor Arnoldo C. Hax

Most executives have probably, at one point or another, sat through a strategic planning session that focused on their organization’s position in the marketplace — its mission and objectives, its strengths and weaknesses, and the opportunities and threats it faces.

But what if there’s another way entirely of thinking about strategy?

I had an interesting conversation recently with MIT Sloan School professor Arnoldo C. Hax, a well-known strategy expert and one of the authors of the book The Delta Project.  We spoke about his approach to strategy, called “The Delta Model” (which, incidentally, is the title of an article he coauthored for MIT Sloan Management Review back in 1999).

Here are a few (edited) highlights of some of Hax’s current thinking about strategy.

Professor Hax, can you tell us a little bit about how the Delta Model differs from traditional strategic planning models?

Conventionally, all of the major frameworks of strategy start by recognizing that the essence of strategy is to achieve superior competitive advantage.  That is what everybody adheres to.  We found that that as a concept and as a mindset is extremely dangerous, because it puts competitors at the center. And if you do that, then there is a tendency to watch your competitors and try to imitate them.

And that imitation creates sameness.  Sameness will never bring greatness, and, even worse, its final result is something which is the worst thing that could ever happen to a business: commoditization.  Commoditization means a business in which there is nothing that you can claim that differentiates your offering, and therefore, all you can do is to fight for price. That leads to a very aggressive rivalry.  In order for you to win, you have to beat somebody.

It is like strategy as war, and that, as we know very well, is not really the most effective way to manage a business.  Wars just create complete devastation; they are the worst thing that could happen to mankind, yet we use that as a simile for management!  We felt it was the wrong simile.

Now, if competitors are not at the center of management, then who is at the center?  For us, the answer was obvious.  The customer is.  Therefore, the customer is the driving force.

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Comments (8)
rafeh
Professor Hax's is also aligned with Norton-Kaplan's strategy maps approach if you consider the customer perspective as your key focus area.
Looking forward to the next Delta model book.

Rafeh Saleh
CID Consulting
www.cid.com.eg
isatash
Please note I don't disagree with Delta model. However, competitive advantage is not putting competitor in the center. It doesn't need to lead us to imitation. Customer is the key. However we need a good strategy to serve that customer effectively so that we obtain the coveted ROCI. In non monopolistic world, more than one company want to acquire the same customer.   What we are going to do differently  in serving that customer and effectively get & retain the business is  important for ROCI.   In my humble opinion that is the competitive advantage.   Our unique routines and politics different from others  to serve one's customers and earn the ROCI  is what I think is competitive advantage.
ssavaram
This is excellent. Prof. Hax has given a new insight into thinking about strategy. As Mr. Weiss, one of the readers, commented, the humanistic possibilities in this approach can lead to a win-win for everyone. Thank you.
La diferenciación es clave para definir las estrategias | AlgoEstaPasando.com
[...] editora del MIT Sloan Management Review, Martha E. Mangelsdorf, publica en su artículo “Strategy as love, not war” algunos apartes de una conversación que tuvo con Arnoldo C. Hax, experto en estrategia y profesor [...]
Tom Gibson - Creating Outstanding Customer Value
[...] Strategy as love, not war - MITSloanReview [...]
shukiw1
Dear Arnoldo
I am a  prctitioner in organizational and business consultancy, and am involved in strategic thinking and development on one hand, and in organizational love as a major currency of people's communication and cooperation.
I deeply value the reasoning behind Delta Model, as this gets one thinking of all the alternatives to competition, clearing the way to a higher form of humanistic creativity.

Three important remarks if I may:
1. It is easier to implement your concept if a leader can imagine himself and his organization as a channel or pipe of Universal bounty, instead of battery/accumulator of wealth.

2. In an excellent article in MIT Sloan Mng.  rev. 2006 x Frederic Frery :"The fundamental Dimension of Strategy" ,extend a new face of strategy
As a coherent interplay of these dimesions(Value, Imitation , Perimeter).
 Where as you suggest that value is a context to use love , Frery implies, that "Imitation" has also qualities , that when taken his way-imply love to competitors and oneself.
Most reveling now (under your inspiration) is, to find that "Perimeter" (the third dimension) , is also most effective when you "draw" it from love.
The ebay example in his article "rings" exactly that.

3. In an outstanding opinion expressed in the same magazine,Christian Mitreanu questions the word "Strategy" itself as implying short  term victory over long lasting success. Your concept makes it clear that for long lasting results, one must not defeat his competitors and God-forbid his vendors. He is going to live with them many years after "the victory".
How in Heaven is the "conqueror" going to manage that without love in such a complex and media ridden world???

Cordially yours
Shuki Weiss
Rehovot
Israel
hernan
That´s the TQC concept for quality products: "compliance with the customers needs"
I understand that Mr. Hax proposal is to extend this concept to business strategy. I wish success to this "Delta Model".
navdeep
Very important point raised by Arnoldo C. Hax, I think while creating the competitive advantage we should focus on the Client ,We can use competitor analysis to understand customer more closely. 
Totally agrees that Client is the center point of all innovation.