Business Strategy

The Brian Tracy Success Library

Brian Tracy
Copyright 2015 AMACOM, a division of American Management Association
112 pages
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Rating

9 Applicability
8 Innovation
8 Style

Focus
Leadership & Management
Strategy
Sales & Marketing
Finance
Human Resources
IT, Production & Logistics
Career & Self-Development
Small Business
Economics & Politics
Industries
Global Business

Take-Aways
Study and learn from the brilliant strategist Alexander the Great.
Alexanders strategy enabled his 50,000-man army to defeat Persias million-man army.
The most profitable companies follow well-developed strategies, yet most companies
fail to develop formal strategies to achieve their goals.

Follow seven principles of effective strategy: Have a clear objective. Stay

offensive and move forward. Mass your resources. Maneuver to be flexible.

Emphasize concerted action so everyone works as a team. Surprise your rivals to

keep them off guard. Use exploitation to press your advantage without relaxing.

Use four strategic planning principles: Create a niche with specialization. Stand out
with differentiation. Target buyers with segmentation. Focus with concentration.

Develop and implement strategy in a five-phase process: data collection and analysis,
formulation, project planning, implementation, and monitoring and updating.

Sometimes the best strategy is to stop what youre doing and start something new.
Sometimes you must accept that a well-liked, costly initiative just isnt working.
Your corporate strategy must reflect your organizations values.

Concepts & Trends

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What You Will Learn
In this summary, you will learn:r1) How to use the seven principles of effective strategy, 2) How to apply the four
strategic planning principles, 3) What five questions strategists should ask, 4) How to develop and implement your
strategy in five phases, and 5) How Alexander the Great set an example of the brilliant use of strategy.
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Review
In most industries, 20% of the companies those with well-developed corporate strategies make 80% of the profits.
Business author Brian Tracy explains strategy and discusses why its so important. He identifies its components,
outlines what strategy requires and elucidates how companies can develop comprehensive strategies to achieve their
goals. Tracy also provides a fascinating report on how Alexander the Greats superior use of strategy enabled his
50,000-man Macedonian army to defeat the million-man Persian army in the 300s BC, though Tracys focus is on
strategy, not on precise history. getAbstract recommends this concise but solid manual to corporate strategists, to
those whose firms need strategic planning and to students of strategy.
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Summary

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Strategic planning
starts with knowing
where you are now,
envisioning your ideal
future, then focusing on
what needs to change in
the present to create the
future.
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The Worlds Greatest Strategist

Alexander the Great (356-323 BC) was king of Macedon, an ancient kingdom in northern
Greece. He was known as the Great due to his strategic prowess. When he became king
at age 20, the Macedonians ruled all Greece.
Alexander learned that disloyal plotters and rebels intended to assassinate him and free
the Greek city-states from Macedonian rule, so he reorganized the Macedonian army,
appointing generals he could trust. Then, he defeated the insurgent armies. By 21, Alexander
was the undisputed master of Greece. He set out to introduce Greek culture worldwide
through conquest. He permitted kings who didnt oppose him to stay in power if they paid
an annual tax to Macedon. Alexander invited soldiers from other countries to join his army
for the opportunity to capture booty.
Darius and the Persian Empire ruled all the Middle East as far east as India and presentday Pakistan. Alexander invaded the Persian Empire, and his 22,000-man army routed
Dariuss 50,000-man army. Darius organized a million-man army to fight the Macedonians
at Gaugamela.

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Strategic planning
isthinking through
the action steps that
you are going to take to
achieve your goals.
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The night before the battle, Alexander communicated his battle plan to his generals. The
Persian army was made up of more than 30 tribes with different languages, different
cultures, different orders of battle, different religious rites and different military structures
of command. Their only commonality was loyalty to Darius. Alexander realized that if he
killed Darius, or made him flee, these factions would quickly disperse. Alexander planned
to attack the center of Dariuss army, drive through it and kill the emperor.
Alexander invented the oblique formation. He lined up the Macedonian army at an angle
and to the right of the center of Dariuss army. Confused, Darius ordered his army to shift
to the right to confront Alexanders maneuver. The Persian soldiers and their commanders
preferred to advance straight ahead, as had every other army in history until then. Taking

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One management
skill is always the most
valuable, and that is
the ability to develop
a clear, workable
strategic plan that
gives you a competitive
advantage in your
marketplace.
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advantage of a breach in the shifting Persian line, Alexander charged his cavalry into
the heart of the massive army. Not anticipating this thrust against his command center,
Darius mounted a horse and fled the battlefield. The news of his abandonment spread
and individual units of his army scattered. The Macedonian army waded into the fleeing,
leaderless troops, killing them wholesale. Some 400,000 Persians died. The Macedonians
lost 1,247 men.
Alexander, then 23, became the ancient worlds most powerful leader. The seven essential
strategic principles he used to defeat Darius remain valid and applicable for strategists
including corporate planners as they were in ancient times. Organizations and
armies that fail to apply even one of the following strategic principles can experience
catastrophic defeats.
The Principles of Effective Strategy
To succeed, put these seven principles to work:

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Firstthink about and
agree on the foundation
principles of your
business.
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Less than 3% of
people at all levels of
business and industry
have clear, specific,
written, time-bounded
goalsthat they are
working toward on a
daily basis.
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You are doing and
offering the right
benefits and prices
when you enjoy a
steady increase in sales
and profitability.
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1. The principle of the objective Success requires having a firmly established goal.
You must know how you will accomplish it, and your employees must know what they
are supposed to do. Alexanders goal was to become ruler of the world. That required
defeating the Persians and getting rid of Darius. Alexander communicated his battle plan
and strategy to his generals, so everyone would know what actions to take.
2. The principle of the offensive Napolon Bonaparte said, No great battles are ever
won on the defense. To succeed, go on the offensive with new products, new services,
new processes and new ways of doing business. Alexander knew the only way to defeat
the Persians was to take the fight directly to them. To beat your competitors, do the same
to them.
3. The principle of the mass Generals defeat enemy armies by massing their forces at
a critical point at a critical time. Alexander beat the Persians by creating a breach in their
lines that he could exploit. In business, take advantage of this principle by delivering
the best products or services in your niche. Dont expand into other product or service
areas until you lead your niche market. According to Bill Gates and Warren Buffett, the
most important element in business is focus. Always focus on the products and services
that your company does best.
4. The principle of maneuver Generals who prevail outmaneuver their foes, just as
Alexander outmaneuvered the Persians. Expert strategists remain flexible; they consider
what might happen and plan accordingly. Be ready to move forward, backward and
sideways in the market, if necessary.
5. The principle of concerted action Teamwork is paramount. Alexander knew he
could count on his troops because he trained them to be the worlds most disciplined
soldiers. Promote a culture of teamwork where employees always speak of us, we and
our and see the company as a logical extension of themselves.
6. The principle of surprise Alexander surprised the Persians and kept them offbalance. Do the same to your business rivals by introducing innovative products and
services and by using novel strategies and processes.
7. The principle of exploitation Once you achieve your goals, dont stop. Keep
moving ahead to exploit your advantage. Your competitors will do everything they can
to make up lost ground. Stay on the offensive.
Five Critical Strategic Questions
Strategize to improve your companys return on investment, secure a new position in
the marketplace, exploit opportunities and spearhead new actions. To carry out strategic

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Embed the strategy
in the company. This
means that most of
your employees fully
understand, accept and
support the strategy.
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Become brilliant
on the basics of
strategic planning
by continuing to ask
and answer the right
questions.
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planning, ask: 1) Whats your current situation? 2) How did you get to where you are
today? 3) Where do you want to be in the future? 4) How are you going to get there?
and 5) What do you need? That is, can you identify the assets, such as skills, resources or
money, that you require for achieving your goals? Strategizing includes conceptualizing
an ideal future for your company and working backward to figure out the steps required
to achieve that future.
Strategic Planning Principles
Include everyone who will directly implement your strategic plan in the process of
formulating it. The senior executive ultimately responsible for implementing the strategy
should participate in the entire process. Otherwise, this executive will have no investment
in the strategy and may prove reluctant to fully support implementation. Corporate
strategy concerns products, services, customers, markets, finances, people, technology and
production capability. Whatever your focus, make sure your goals are clear. Communicate
them to everyone in your company and to your shareholders, stakeholders and consumers.
Follow four strategic planning principles:
1. Specialization Focus on what you do best. If you expand beyond your core products
or services, move only to an adjacency area a new product or service line that
expands your core business.
2. Differentiation Separate your firm and its offerings from your competitors.
3. Segmentation Target the ideal customers most likely to buy your goods.
4. Concentration Apply your resources where they will do the most good.
Formulation and Implementation
The Kepner-Tregoe consulting firm suggests a five-phase plan for creating and
implementing strategy:

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Specialize and do a
few things exceptionally
well. Your chosen area
of specialization largely
determines the future of
your business.
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1. Strategic intelligence gathering and analysis Use only the best data available.
2. Strategy formulation Include a time frame and an endpoint. As you formulate a
plan, catalogue your current, modified and new products.
3. Strategy master-project planning List and prioritize all your projects. This pool
of projects is your master plan for the strategy.
4. Strategic implementation Put the proper structure in place. Align your strategy
with your organizational structure, and communicate your strategic plan.
5. Monitor your strategy Update as necessary.
Everyone in your organization must team up to make your strategy work. The business
units must integrate their actions. Offer incentives tied to the strategic initiative to motivate
employees. Implement the necessary controls to keep everyone on track.

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Strategic planning is
not only about what you
need to start doing
Its also about what you
need to stop doing.
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The strategy you choose determines who your rivals will be; their responses will require
further strategizing. Make the effort necessary to ensure that your customers view your
products or services as their best choice.
Driving Force
Consultants Benjamin Tregoe and John Zimmerman stress the importance of identifying
your driving force, that is, your primary strategic concept and your quantitative principle.
This force is the point of the spear of business planning. Each of these factors can be a
driving force:

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The most successful
men and women in the
world seem to be those
whose values are clear
to them. They refuse to
compromise them for
any short-term gain or
advantage.
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Get the facts. Get
the real facts. Not the
apparent facts, the
hoped-for facts, or the
obvious facts. Get the
real facts based on
analysis. Facts dont
lie. (Harold Geneen,
ITT)
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Product or services Align your offerings to fit the scope of your market.
Market needs Provide what consumers want.
Technology-driven driving force Structure your business by using the
latest technology.
Production capability Ensure that you possess the capability to keep up with your
projected growth. Ikea, for example, constantly creates more and improved furniture for
greater numbers of consumers in markets that keep growing.
Method of sales You could use retail, wholesale, direct mail, Internet, distributors
or manufacturers representatives.
Size and growth For example, automaker Toyotas motivating force is to
consistently increase its market share. As sales grow, Toyota applies economies of
scale to lower production costs and increase profits.
KWINK
Sometimes, the most important strategic insight to embrace is knowing what I now
know (KWINK). This means honestly accepting that certain initiatives no matter
how much you want them to do well and no matter how extensive their sunken costs
arent working. When you identify dysfunctional or underperforming products or services,
ruthlessly discontinue them or divest them.
To move forward, you may have to abandon products or functions that worked in the past.
Having to divest should never make you cautious or lead you to think small. Be ready
to create an entirely new market if you find a promising niche, product or service. When
Netscape introduced its web browser which reshaped the video rental business, consumer
viewing habits, film and television distribution and audience polling it fearlessly unveiled
a new product for unknown customers.
The Importance of Your Corporate Mission
Strategy should carve out and delineate the path to accomplishing your mission, whatever
it may be. Stating a crystal-clear mission requires knowing your values, your visionand
your purpose. Use a specific and measurable mission statement to spell out your goals to
everyone in your organization.

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Peter Drucker once
said that, even when
a business is starting
out at a kitchen table,
if the business does
not dream of world
leadership, it will never
be a big success.
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You can start with a generic mission statement as a model and insert your company specifics.
A generic statement might read: We will provide the finest example of our product to the
correct market to create significant improvements in our consumers professional and home
lives. We will always upgrade the quality and functionality of our offerings and never stop
seeking out, finding and selling to new and ever-more loyal consumers. We will increase
our market share and profits by at least 20% annually.
Your strategy should reflect your companys qualitative never quantitative values
and foundational principles, such as integrity, quality, customer service, innovation,
entrepreneurship and profitability. Your strategy should also support your vision. The right
strategy can make your vision however ambitious a reality.

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About the Author

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Brian Tracy is chairman and CEO of Brian Tracy International, a training and development firm. His other books
include No Excuses!, Eat that Frog!, Maximum Achievement and The Psychology of Selling.
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