ZAG: The Number-One Strategy of High-Performance Brands

Unlocking Your Zag

Gerstner was successful in transforming IBM from a seller of “big iron” to a leader in technology services because he was able to address the central problem of brand-building: How do you get a complex organization to execute a simple idea? Of course, first you have to get a simple idea—a zag. Second, you have to use “generative learning” rather than “simple learning” to change the way the business operates. “Simple learning” is learning how to do the same thing better. “Generative learning” is learning how to do new things. “Most of all,” said Gerstner, “it requires that the organization do something different, value something more than it has in the past, acquire skills it doesn’t have.”

Organizational theorist James March ...