Better, Simpler Strategy

15

No Reason to Sneer

Professor Michael Porter popularized the distinction between operational effectiveness and strategy. Strategic moves, he explains, confer a lasting competitive advantage. Operational effectiveness is important but not sufficient to achieve corporate success.1 After all, everybody strives to be operationally efficient; there is no lasting advantage in adopting modern management practices, because every company will use these techniques if they prove effective. Smart strategic moves create differences between companies. Investments in operational effectiveness reinforce similarities (figure 15-1).

Figure 15-1 Strategy versus ...