Businesses, even over half-a-century back knew how to make money, a great deal about the value of their products, a decent amount about who their customers were, and somewhat about the competition they faced. However, it was not until the 1960s, that consulting pioneers pushed companies to think deeper and develop long-term strategies for sustained growth. Through the last fifty years or so, business organisations have developed a much deeper understanding of their operating environment including the most important three – costs, customers and competition.
Author, Walter Kiechel III, in his book “Lords of Strategy – The Secret Intellectual History of the New Corporate World” – discusses in great detail how consulting firms shaped business thinking in the latter half of the last century, by getting corporations to focus on strategic planning rather than event-specific business plans. Kiechel, a business journalist and former editorial director of Harvard Business Review, takes his readers through the biggest revolution business has gone through in the last five decades – the Strategy revolution. “Lords of Strategy” is an engaging narrative on how the concept of business strategy came to evolve, and along with it, how strategy consulting firms came to occupy an important position in business affairs.
It’s important to note that this is not a guide to applying strategy or use ideas as successful business tools. Rather, it is a chronicle of who, why and how of tools development, and their significance to modern-day corporations. It’s a tale woven around the early players in the consulting industry. The book doesn’t discuss merits or demerits of various ideas but brings to the fore the realisation that ideas are important, and can be devised like tools.
The book opens with challenging three widespread beliefs in order to make the readers understand what led to changing mindsets of the top business leaders. It confronts general wisdom that running a business is common sense, and is all about implementation. Kiechel argues that consultants use concepts from a wide array of analytical techniques and ideas, dug up from careful study of competitive edge, clients’ behaviour and companies’ performance. Further, he debunks the belief that there is no difference between ‘strategy’ of post-1960s and ‘ideas’ prevalent earlier, and also calls for reconsideration of the notion that consultants are of only occasional and limited use. Consultants are good at developing models and tools that can apply to businesses across the board, he goes on to argue.
As with most business books, more so with the ones that seek to study such important trends in depth, Lords of Strategy dives a little too deep in some sections to discuss leading firms’ internal affairs – which may be interesting for deep-rooted industry professionals, but make it a slow-read for others. Though, the parts playing out the conflicts between early players are interesting. Some prior understanding of the concept of business consulting will be helpful for readers, as the language and references used in the book are meant for those with already some familiarity with the industry, general trends and major events.
In the spirit of staying true to its subtitle – “secret intellectual history” – the book spends too much time in developments around 1970s and 1980s, arguably the most important period in the strategy revolution, but falls short in describing recent developments, like the impact of technology on businesses. The contents of the book become even more important in the aftermath of the financial crisis, further highlighting the need for strategic ideas, as amply explained. Strategic thinking not only helps in looking out for structural weaknesses or systematic risks, but also stay ahead of the curve by being prepared to deal with unplanned exigencies.