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Roger Martin, dean of the Rotman School of Management, University of Toronto, Canada, was in Mumbai last week to promote his new book Playing to Win: How Strategy Really Works. Co-written with the former CEO of Procter and Gamble (P&G), A.G. Lafley, the book examines why you need to have a strategy and the steps you should take to design and implement a winning one. Martin, an alumnus of the Harvard Business School, US, worked early on in his career with the legendary Michael E. Porter, author of Competitive Strategy: Techniques for Analyzing Industries And Competitors. It was while working at Porter’s consulting firm Monitor in the 1980s that Martin was introduced to consulting. He spent the next 27 years in association with P&G; almost a decade of this was spent in close consultation with Lafley, the co-author of this book.

We caught up with the 57-year-old academic writer in between his sessions and presentations to head honchos like Cyrus Mistry, Nandan Nilekani and Vineet Nayar and their top management teams, to discuss his perspectives on strategy. Edited excerpts from the interview:

You say in your book that most CEOs don’t have a strategy.

Most companies don’t have a conscious strategy, they are just doing a bunch of stuff that doesn’t add up—they don’t have any useful strategy.

They might say “we are going to be the best in the industry" and they think being the best in their industry is a strategy—it’s not. It’s a slogan.

Strategy is an integrated set of choices that produces an outcome. It defines where we are going to play—if a CEO can’t define that, he or she probably does not have a strategy worth having. Saying we want to have the good customers is a non-choice; instead, if you say, for instance, we want customers who value variety over low price, that’s coherent. That way you can organize yourself to have high variety—to have a value proposition to that customer base that is distinctive.

Too many CEO aren’t deterministic enough. They kind of think you can just go along and sell stuff and everything will be fine.

I have a darker view of this— if that is what you are doing somebody else is going to be doing something much better by listening carefully to customers, and figuring how to build up a set of capabilities to win the hearts and minds of those customers. If you are sitting here with this slogan and doing more of the same, your customers will slowly but surely drift away and you won’t know why.

You make the point that a company must play to win. To play merely to participate is self-defeating?

I do that because otherwise you are so vulnerable. If you are not trying to win then somebody else will win. But this doesn’t mean only one company will win. Somebody else in the industry can win against a different set of customers. It actually makes it better for the customer; if two companies are trying to win in different ways, with different segments, there will be more offerings in the market.

What is your advice to senior management to think strategically?

Keep asking yourself, “Why am I doing what I am doing?" Be mindful of what you are doing. It is almost like Toyota’s “5 Whys". Once you get inside the logic of that, it will train you to think more strategically .

Your book is peppered with case studies from P&G—there is even one customer-based India study on Gillette razors. How did you choose these studies?

This is the advantage of working hand in hand with AG (Lafley). The most typical business book of this genre uses case studies from all sorts of companies. We thought hard and said let’s use mainly P&G studies. All the stories are from things that AG and I were intimately involved with driving. So we decided to go for depth of story rather than variety. We used these tools we talk about in the book to do these things and we are now just reporting on the use of these tools.

The hardest thing was choosing which stories to leave out! For instance, we did some really interesting work on Folgers Coffee. It was an incredibly successful business, where we were the No. 1 brand in America. But food just didn’t fit any more—so we monetized, sold it for several billion dollars.

We did just a little bit on oral care. There are many more stories on Swiffer too that we had to leave out.

You are ending your term as dean of Rotman School later this year. What is your next assignment?

To study the future of democratic capitalism. There is a bunch of things you could say about democratic capitalism that aren’t working the way they should.

For the first time in American history the median income in the country is not rising. The wealth has increasingly gone to the top 1%. Nobody thought that would happen with democratic capitalism, that it would produce ways of operating that would destroy the planet ecologically.

There’s a lot of infrastructure that supports democratic capitalism, regulatory infrastructure, physical infrastructure. Some of the existing infrastructure designed for a different era no longer works, some hasn’t yet been built. We need to fix the infrastructure on democratic capitalism to make it better, and my work for the next five years is to focus on that.

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Updated: 18 Feb 2013, 11:43 AM IST
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