A Class with Drucker - Headway | Work on yourself

BASE YOUR STRATEGY ON THE SITUATION ■ 213
even bring along an assistant or a secretary. By this means of presenting his
strategy, he didn’t need a large team or elaborate equipment.
Also, Peter told people what to do, not how to do it. He did this in his
books and articles, in his presentations to corporate management, and of
course, in the classroom. Although there is probably a hierarchy of strategic
actions which can be distinguished by an infinite number of divisions,
traditionally there are but three.
Imagine a pyramid. At the apex and highest level is grand strategy.
This is the strategy planned at the top level of a corporation or any entity.
One level down, grand strategy is supported by what we could term operational
strategy. Operational strategy would be performed to implement
the strategy decided at the top. The final level is termed tactics. Tactics
are the actions taken to implement the level above it, which again we
called operational strategy.
Peter always dealt at the top level. When he advised Jack Welch or
other CEOs, he wasn’t giving advice on how to do anything. He didn’t have
the specialized knowledge. Remember, he came to any situation not <strong>with</strong>
his knowledge and experience of the business, but <strong>with</strong> his ignorance (see
Chapter 6). He was telling Welch and GE what to do, not how to do it.
How to do it was the operational strategy. The grand strategy for GE was
to wean out less profitable businesses. How this grand strategy was to be
accomplished was decided by Welch: “If a business is not first or second
in its market, get rid of it.”
<strong>Drucker</strong> Lesson Summary
There were three key aspects of any situation that <strong>Drucker</strong> had to take into
consideration. These were:
■ what <strong>Drucker</strong> called the “certain” or fixed variables of the environment
over which the strategist had little control, along <strong>with</strong> the
resources already available or those that could be obtained.
■ the variables over which the strategist could always exercise control,
and which could support the strategy decided upon.
■ the principles which he knew intuitively and applied unconsciously.
He then had to put all these variables together in such a way as to
achieve the objectives desired.