Its Purpose

Its Purpose Overview
Where Planning Works
Where Planning Doesn't Work
What Does Work and Why
Competition and Production
The Information Problem

Competition and Production

Both planning and front-line strategy are necessary to be successful. Planning is the method of production. Front-line strategy is the method of competition. Every organization must do both: produce and compete.

Production and competition work together. Planning production makes the most of what you can control. Competitive strategy makes the most of situations you cannot control.

Planning is the best way to learn strategy. Though you can learn some elements of front-line strategy without planning to do so, through trial and error, planning to learn front-line strategy is much less costly and painful. Planned training can produce people who better understand the methods of front-line competition. The military and every competitive sports team realize that they must train their people in front-line decision-making.

The secret is clearly understanding when to use the appropriate methods in making decisions. Planning works within our span of control. Strategy works during a competitive contest. Planning works because people work together. Strategy works by leveraging the actions of others so they work with you. Planning uses known, available resources. Strategy captures those resources in the contest with others. Planning creates standardized, duplicate products. Strategy creates unique, customized solutions. While planning seeks to better control the internal environment, strategy seeks to better adjust to the immediate competitive environment and situation.

Productive and competitive methods create the resources for each other in a constant cycle. The better our competitive strategy, the more resources we capture to use internally. The better our planning, the better our production of tools to use in external competition. Competition and production are closely tied to each other, but they require different skill sets. In the science of strategy, they are defined as "complementary opposites." Both are necessary. They work together. But you must understand how they are different.

The problem in recent decades is that our knowledge of planning and production has greatly overshadowed our knowledge of strategy and competition. We no longer understand how different the methods of competition are from those of production. The popularity of ideas such as "strategic planning" demonstrates this confusion. People plan for external results because they are not familiar with the concepts of classical strategy, even though those concepts have been around for 2,500 years.