After a long time, I have read a book that has engaged me from start to finish — especially a book on strategy. No jargon, no lecturing, no macro level truisms — just plain, down-to-earth learnings with very workable suggestions. This is what a successful CEO (Alan Lafley of P&G) and a hands-on dean (Roger Martin of the Rotman School of Management) have produced in Playing to Win.
Essentially, the writers have taken a fundamental approach to strategy — “it’s a set of choices about winning” — and how it drives you to decisions on where to play and how to win. Underlying all this is the basic premise of a clear vision backed by an insightful understanding of your customers, both trade and consumers. None of this will work unless you have the internal capabilities (people) and resources (money).
The book is filled with the success and tribulations of P&G brands such as Oil of Olay, Crest and Pampers, and the acquisition of Gillette, and how, in each case, strategy was employed to win. What I found most interesting was just how few of us go beyond analysing current competitive pressures without actually anticipating competitive action/reaction to our well-planned moves. Lafley and Martin emphasise that merely putting a strategy in place is not enough, unless a deep understanding of the market and consumer leads to the launch of a differentiated product. If one is unable to differentiate, it is imperative to be a genuine low-cost producer, otherwise one is doomed to failure. The other obvious elements like brand, distribution, pricing, advertising and promotion are a given and a must.
It is not enough to enter an attractive market or growing segment. You must then have one or both of these key strengths (low cost and differentiated product) to reap long-term gains. Mars successfully followed this strategy against Hershey in candy bars. Closer home, it was Parle-G biscuits that played the low-cost producer game and carved a huge segment in the biscuit market and, in fact, outplayed Britannia. It took Britannia years to retaliate with Tiger, a differentiated product in the glucose segment. I wish this book had been available to me earlier — it would have been invaluable during my tenure at Britannia!
Mistakes, however, continue to occur. Companies feel they have the required strengths to enter a growing segment or a new market without ensuring that all the pieces that add up to a winning strategy are in place. Lipton’s entry into biscuits, Marico’s entry into health snacks, Unilever’s earlier entry into noodles and GSK’s entry into tetrapack milk-based drinks all can be found in the graveyard that houses product launches resulting from incomplete strategy.
The lessons, then, are simple. Ask the right questions, simplify and crystallise the issues and come up with the right choices. Then, clearly communicate the same to your team and adopt the Lafley-Martin model for a winning strategy. Do not overestimate your strengths or underestimate the response of your competitors. Read the book with an open mind — it provides a lot to fill it with.