ABSTRACT
Chapter 2 introduces the notions of Grand Strategy and Operational Strategy. Most strategy practitioners are familiar with Grand Strategy: it is the process that leads to hypotheses about the moves the company could make to attempt to attain a sustainable competitive advantage or, more realistically, an as-long-as-possible competitive advantage. However, very few practitioners do Operational Strategy, that is, testing these selected possibilities in depth, thus either confirming and detailing, adapting or rejecting the Grand Strategy hypothesis. They go straight from Grand Strategy to strategy execution, which explains the subsequent failure of many a strategy. The chapter first summarizes the many traditional approaches that fit under the Grand Strategy umbrella. Those approaches use the concepts of market attractiveness and competitive position to indicate where and how the company should compete. The chapter then shows why an end-to-end process covering both Grand Strategy and Operational Strategy is required. Next it describes an effective and efficient way of running the Grand Strategy part of the process, as a lead-in to Operational Strategy. Afterward it goes into the merits of Grand Strategy other than being a required lead-in to Operational Strategy. Finally, it illustrates the various concepts with a detailed case example taken from the payroll services industry.
