Playing To Win
The Origins of Playing To Win
The Backstory of a Strategy Classic
Yesterday (Feb 5, 2023) was 10th anniversary of the publication of Playing To Win, which, happily, has gone on to be one of the best-selling books on strategy ever published. Perhaps most gratifyingly, it continues to be relevant a decade after publication. I thought readers might be interested in how the book came to be, so my 9th Year III Playing to Win Practitioner Insights (PTW/PI) piece is on The Origins of Playing to Win: The Backstory of a Strategy Classic. You can find the previous 119 PTW/PI here.
Back to the 1980s
The seminal moment for Playing to Win (PTW) happened in 1987 while I was leading a Monitor Company strategy assignment for the medium-duty truck axle business of Eaton Corporation, a transportation/auto parts/power company (then) based in Cleveland, Ohio (though this business unit was in Battle Creek, Michigan).
Monitor Company faced a bit of a challenge in that era. The firm had been birthed in 1983 to address the overwhelming volume of requests for advice by executives who had read Michael Porter’s seminal 1980 strategy book, Competitive Strategy, the first ever business best-seller. Mike couldn’t meet the demands alone, so he got help from a group of his professorial colleagues and students to birth and grow Monitor into what became a large global strategy consulting firm.
The book contained various insights that readers found fascinating and helpful. But first among them was the Five Forces analysis of industries. Clients wanted us to perform Five Forces analyses for the industries in which they operated, and in the early years, that is what we mainly did, plus taught seminars to management teams on concepts from the book’s various chapters — customer analysis, competitor analysis, cost analysis, etc. But in due course, some clients started to ask us about the other seminal insight in the book: generic strategies. Clients would self-identify as ‘stuck-in-the-middle’ and ask us to help them migrate to the kind of generic winning strategy that Mike described in the book.
The challenge for Monitor was that we didn’t have a methodology for moving a client from ‘stuck-in-the-middle’ to a winning differentiation or cost leadership strategy. And if you are curious as to why, go back and reread Competitive Strategy and its 1986 successor Competitive Advantage. You will see a host of frameworks and tools that fundamentally changed the way the world thinks about strategy, but no hint of a methodology for creating one.
I took up the challenge of creating a strategy methodology for Monitor and the very first attempt was the above-mentioned study for Eaton in 1987. For the work at Eaton, I drew the first rudimentary strategy process that showed how the various analyses needed to be sequenced to come up with a strategy. Sadly, all those early drawings were destroyed by an incompetent office manager in our Cambridge head office who decided that it made sense to her to send a dozen bankers boxes of my materials from the 1980s to the shredders, so it is truly gone in the mists of time. I have a vague visual recollection of it — but that is it.
Then, between 1987 and 1989, colleagues and I created and taught an important program for P&G called Applied Strategic Management (ASM) for the then newly created Category Management Teams (of which there were about 80 worldwide). It was during the ASM that I met both AG Lafley and Wolfgang Berndt, both of whom became strategy enthusiasts, even though, in retrospect, the ASM was still primitive, mainly a set of individual tools, not an integrated process for creating strategy.
Contemporaneously with the Eaton and P&G/ASM work, I opened the Toronto office of Monitor Company and continued to refine my work on a strategy process at Canadian clients. That included Weston Foods, at which I created the Logic Flow of Strategy, and Inmet Mining, where I dreamt up and first deployed the ‘what would have to be true’ question, and Avenor, where I utilized the earliest versions of the Strategic Choice Structuring Process. I also employed it in those years at various US clients including a memorable and successful efforts for Herman Miller’ office furniture business and Honeywell’s HVAC business.
Evolution in 1990s
The early 1990s were tough times for me at P&G. After the resoundingly successful ASM program, I had led an extremely influential study in 1990 that led to Efficient Consumer Response (ECR), a transformative way of dealing with the retail trade that provided P&G with a substantial leg up on its competitors for the better part of a decade. However, the people involved in utilizing my work acted like such jerks that I swore off P&G for a couple of years.
In 1995, Wolfgang became President of North America, then the dominant part of P&G, and wanted to develop a next-generation version of the ASM. His folks reached out to me, and I told them to get lost. Undeterred, Wolfgang and then-junior finance manager, Jacob Mathew, took it upon themselves to travel to Cambridge, Massachusetts to talk to me. It was a warm meeting. I already remembered Wolfgang fondly from the ASM and found Jacob to be lovely too, so I relented and agreed to help them with a strategy process refresh on behalf of P&G NA. I was helped to do so by my wonderful longtime Monitor collaborator, Sandi Pocharski, with whom I had worked in the early days on Weston Foods, among other projects.
That work, in 1995–1996, incorporated my latest thinking on the Strategic Choice Structuring Process that I had been developing with the clients mentioned above. But perhaps most importantly, it was the first time that I drew the Strategy Choice Cascade — the five key questions that define strategy. I taught and deployed the Strategy Choice Cascade at numerous clients, and it became the core strategy methodology of Monitor Company.
AG and the 2000s
In 1998, I left Monitor to become Dean of Rotman School. But at the request of then P&G CEO John Pepper, I continued to provide strategy advice to P&G. But practice using the tools taught in 1987–1989 and refined in 1995–1996 was still very spotty at P&G. Some businesses and executives used it, some didn’t.
But that was about to change. In June 2000, AG became CEO of P&G, and he was nothing short of awesome. He made the Strategy Choice Cascade and Strategic Choice Structuring Process the essential cornerstones of strategy at P&G. It evolved from a set of ideas to a practice — the best development lab anyone could ever hope for. It was nine years of terrific work together — with the best thought partner imaginable. That was in part because in addition to being a terrific thinker, he was also an intensely practical businessperson who made sure that the concepts were entirely usable in the real world of business.
The Birth of Playing To Win
By 2005, AG and I started discussing writing a book together on our strategy work. But AG didn’t feel it was appropriate to write a book about strategy at P&G while the sitting CEO of the company, so we waited until he stepped down in 2009 when we started planning in earnest for the book. We wrote the book in 2011–2012, aided by my longtime collaborator and now dear friend of AG too, Jennifer Riel, who worked with me at Rotman and is now a Partner at IDEO. The book came out in 2013, with the co-authors described as the “former Chair & CEO of P&G” and the “Dean of the Rotman School.” Ironically, three months later AG returned as CEO of a turnaround at P&G and another month thereafter, I stepped down as Dean, so it should have said “Chair & CEO of P&G” and “former Dean of Rotman!”
The Past Decade
Happily, PTW has gone on to be one of the most used and influential strategy books of all time. It is almost always credited with being practical and usable, which makes both of us happy. And it seems to have stood the test of time, which is never a trivial task in a fast-moving business world. It continues to sell strongly and as does facilitator’s guide Playing To Win Toolkit which we published (with Jennifer Riel added as a co-author) a couple of years later.
AG and I felt that PTW should demonstrate that strategy can be simple, fun, and effective. Strategy is often thought of as complicated, onerous, and ineffectual — destined to sit uselessly on the shelf. We aimed to encourage and facilitate the opposite.
So, if, as you use PTW, it starts feeling complicated, you can feel confident that it has gone in an unproductive direction. The product of your work is unlikely to be helpful to you because complicated strategies are rarely profound, and even if one is, it will be very difficult to translate into useful action. The goal of PTW is to make a few key choices. If it is starting to feel complicated, use that as your signal to work to refocus on the few choices at the center of your strategy. Focusing this way is not a trivial thinking exercise. But it is the direction in which you should push when your work on strategy feels complicated.
If, as you use PTW, it starts feeling onerous, step back and ask what would make it fun? Strategy should be a creative, expansive exercise that produces a compelling view of the future. Even if the current context is difficult, the exercise of creating a path to a better future should be enjoyable and inspiring. If it is not, chances are that you have lapsed into planning rather than strategy, and planning is a dull and dreadful substitute for strategy.
Finally, if, as you use PTW, you can’t readily see your work on it being put into action, then stop. It isn’t worth the effort. Throughout the PTW effort, focus on strategy as making real choices. That is the key to ensuring that your strategy work will be effective for you.
If you keep your eyes on simplicity, enjoyment, and effectiveness as you work with PTW, over time, your practice will make you a strategy expert, and you will experience more delight than pain along your journey.