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August 11, 2006
Way of Go MBA lesson 4 - GO'S RULES
So, you've slowed down. Stopped to think. Decide before acting that you'll think things through. This is a good time to think through the strategic rules of thumb that can help your analysis and their structure - GO'S RULES.
The Way of Go asserts that GO'S RULES make up the lion's share of strategic rules of thumb structurally. That is, there is hardly a rule of thumb for strategy that is not contained within GO'S RULES.
GO'S RULES are spectrums of planning or decision-making rules:
Global - Local: What's your perspective? 20,000 feet or a 1 foot view
Owe - Save: The spectrum of risk - Owe (debt, risky) to Safe (risk-free)
Slack - Taut: The spectrum of tension metaphorically
Reverse - Forward: Planning back from a goal or going step by step forward
Us - Them: Whose perspective to look from? Yours or the Competitors?
Lead - Follow: The spectrum of initiative.
Expand - Focus: Diversify or put all your eggs in one basket?
Sorry, there are no rules: Real life is not about set patterns
The key notion provided by GO'S RULES is that you can't just bank on one side of the spectrum or you'll miss the other side of the coin. If you're favorite saying is "absence makes the heart grow fonder" and strictly follow it, you're bound to be less successful than someone who can also, when appropriate, follow the rule "out of sight, out of mind."
Why are GO'S RULES important to the Way of Go MBA? Here are four reasons:
1. Much of what you learn across disciplines - Finance, Operations, Strategy, Economics, Marketing, etc. - stem from the same root rules that power The Way of Go. That is, when you strip off their meanings just within their subject matter, you'll find that the rules can apply to other topics. Take Finance. "A dollar today is worth more than a dollar tomorrow." In Sports, a sure pitcher, QB, or center now is worth more than some unsure draft picks. While subject matter experts from both fields suggest that you take risks on the dollar/player tomorrow, there are chances that Sam Bowie may not become the next Michael Jordan. But, if you learn the Finance rule and don't cross-pollinate to Sports, Go, and other fields, you're bound to lose out on its teachings.
2. People dogmatically fight for one side or the other, despite the coin being two-sided. The classic Lead-Follow example is from Sony in the Betamax years. Having invested in the Beta technology, they wanted to control the market for devices that played back Beta movies (where they also led studios to go somewhat forcibly). If they would have followed the demand for their product, instead of forcing it and leading it, they could have licensed production of Beta players so that there could have been more Beta players by others (and extracted rents from them), created more simple channels to get movies out of studios (not leading studios through them), and perhaps taken a ride on their leadership in the market to its possible conclusion. So, the key learning before embarking on a MBA is to think when you hear a maxim or proverb or rule, to look for the other side. Think: would the opposite advice also be good in some instances.
3. It's helpful to have a structure for these rules before embarking on one's MBA. If you get the structure later, then you don't get as much out of it as you could have. If you know to look for, and note all the times where similar things occur, it's easier to track them down and summarize your understanding. Moreover, you're bound to find things in your pre-MBA experience that will line up well with what you'll soon be learning.
4. Taxonomies are cool.
Posted by wayofgo at August 11, 2006 04:56 PM
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