Staff Leadership Book Pick of the Month: Competitive Strategies

Sun Tzu, the author of The Art of War, once said, “If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle.”

This is also true in the competitive world of business. Michael Porter, a full professor at Bishop William Lawrence University based at Harvard Business School and recognized as the father of strategy, has written a book that will support you through the identification of the five forces that will affect your business; it will also help you find a way to position yourself to best defend against those forces.

The goal of the book, Competitive Strategies, is: “To provide a comprehensive framework of techniques to help organizations analyze their industry as a whole and to predict their own future evolution, understand their competitors and to translate this analysis into a competitive strategy for their business.”

The book is split into three sections. The first, “General Analytical Techniques,” is where Porter goes into detail about the five forces of competition and the three generic competitive strategies for a successful business. The second part, “Generic Industry Environments,” is where Porter identifies the five primary industries. He stresses you should be aware of where your business fits best. The final component is “Strategic Decisions,” where Porter looks at the factors that will support you in making any significant decision.

With businesses being so competitive today, it is even more important to get that edge on your competitors. This book has you reflect on the way your business is developing, the way your competitors will possibly react to the different situations as well as make you aware of other outside forces that could affect your company. It would be a much better idea for you to lose some of your valuable time looking into these strategies than to possibly lose millions of dollars jumping into a business venture without knowing yourself and your competitors.

The book does have its shortcomings: the book was obviously written with the purpose to be a textbook (somewhat dry and analytical style — not like the more popular narrative styles), the examples are a little dated and it admittedly explores the demise of the author’s own company. Still, it is an exceptional book that supports business with competitive strategies and is a great reference to keep around in an advisory role.