What Is Strategy? It’s a Lot Simpler Than You Think

To many people, strategy is a total mystery. But it’s really not complicated, says Harvard Business School’s Felix Oberholzer-Gee, author of "Better, Simpler Strategy".

00:00 To many people, strategy is a mystery.
00:25 Strategy does not start with a focus on profit.
00:52 It's about creating value.
01:00 There's a simple tool to help visualize the value you create: the value stick.
01:30 What is willingness-to-pay?
02:30 What is willingness-to-sell?
03:14 Remind me: Where does profit come in again?
03:48 How do I raise willingness-to-pay?
05:00 And how do I lower willingness-to-sell?
06:18 Real world example: Best Buy's dramatic turnaround

Companies should simplify and focus on two value drivers, he argues: customer satisfaction and employee satisfaction. By aligning strategic initiatives on these alone, leaders make their workers’ jobs less complicated and improve customer experiences.

Produced and edited by Scott LaPierre
Video by Dave Di Iulio and Elie Honein
Animation by Alex Belser

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[peacebakare]

This is a super complement of "A Plan is Not a Strategy" by Prof. Roger, that I just watched. I have learned so much about Strategy within 20mins I feel like I have some powers at my disposal right now. Looks like I'll like to have a MBA for structured and consolidated knowledge.

[Willbudi]

Strategy is a plan to create value.
1. Not focus on profit
2. About looking forward to planning for the future
3. Building value for customers, employers, and suppliers
4. Value = difference between willingness to pay (customer) and willingness to sell (supplier)
5. How do I raise willingness to pay? Product Quality, Product Complement, Network Effects
6. How do I lower the willingness to sell? Provide better working experience as a trade-off

For e.g. Best Buy, increase WTP by offering customers with faster delivery directly from BB neighborhood stores, utilizing BB stores as warehouse

[SiddharthSingh]

Amazing job creating this content - Core concepts simplified under 10 mins

Hoping to see more content in this format.

[carolroberts]

Excellently and succinctly explained. Please put Mr. Oberholzer-Gee in more videos! Also, excellent visuals here!! Bravo!!!🏆

[burhani]

Best content for a long time on youtube! Thank you for that HBR and Prof. Oberholzer-Gee.

[jwp]

Felix, let me disagree, a strategy is not a plan. Strategy is about how-to achieve something - the story if you like. And a plan is about the what, where, and when - more like the chapters of a book.

[meshangovender]

Profound content. What a gift to be able to explain something so complex so simply. A true MBA in 10 mins

[PraveenKumar-edxt]

Tons of value loaded video, It can't be simpler than this, so clear, with examples 🙏

[ChengeerLee]

Brilliant. And you are an amazing educator. Great work, kudos to the production team. Top notch work!

[kumbukanikachingwe]

Thanks very much Havard, watching these videos really helps alot. It's kinda like we are on campus, i had to watch these episode 5 times to really get hold of WTP and WTS. Thanks.

[adriendeotto]

Anyone who tries to grasp what strategy is should start with this video. A big thank you to Felix Oberholzer-Gee and the HBR channel for sharing such high-quality content and insights 🙏

[SalawuIbrahim]

This is amazing! I feel a lot smarter on the topic of strategy. I'm also aware enough that I need to learn so much more to be able to take advantage of this body of knowledge I just acquired. Thank you Felix!

[Ms.T]

The anticipation of starting my dream job in a couple of weeks thrust me into this journey... I started with optimization of the Game theory in in my career, then I stumbled on "Planning is not a Strategy" to wit; a strategy is a plan that is based on logic that is simple & can be tweaked(with a pre-established tweaking mechanism) when it is not working... Full circle moment... 🎉

[extedax]

Excellent content! If you're looking for a 10min MBA, this the closest you could get to it.

[osama]

Thank you! I like how straightforwardly you educate.

[abubalo]

I am impressed by HBR consistency to release great video after great video👏

[culturapoliticaycomputador]

This is a valuable video, it's a gift for all of us. Thank you Mr. Felix Oberholzer-Gee.

[Kakanato]

Felix, you have just increased your value by increasing the willingness to pay and decreasing the willingness to sell!

Awesome real life example!

[samartharya]

Beautiful video. Stick diagram makes it lot easier to understand. Example of Best Buy suits well too. Would love to read more.

[stevenmalolo]

I love how you broke it down so we can understand. Love the content!