The Art of the Shifting Concept
1. Read the text.
One of the first tricks a management guru learns is the art of the “shifting concept”. The following exchange will give you an idea. The business school professor tells the class that successful firms must establish high market share.
“What about BMW?” asks a student in the front row, who knows that BMW has a far smaller market share of the world car market than many less successful companies. “Ah,” the professor replies, “BMW has a high market share in the luxury car segment.”
One of the most famous propositions in business strategy is Michael Porter’s injunction not to be “stuck in the middle”. The worst strategic error is to be stuck in the middle, or to try to pursue all the strategies at the same time. This is a recipe for strategic mediocrity and below-average performance, because pursuing all the strategies at the same time means that a firm is not able to achieve any of them because of the contradictions between them.
Every Sainsbury’s van has “Good food costs less at Sainsbury’s” painted on the side. Is Sainsbury’s problem today that it is stuck in the middle? And Sainsbury’s is not alone. Research has been done into how return on investment relates to strategic position. The “stuck in the middle” position – medium cost/medium quality – in fact does slightly better than the clearly focused choices of high cost/high quality or low cost/low quality.
So what does a guru do when faced with the goal? You shift the posts. Perhaps “don’t be stuck in the middle” means not that you must choose one or the other, but that if you don’t succeed at something you will fail.
Confronted by the Sainsbury’s van on British television, Porter argued that since Sainsbury’s was not a delicatessen, it must be low-cost competition. Yet if “good food costs less” is not a strategic position which is stuck in the middle, it is hard to know what is. Perhaps all “don’t be stuck in the middle” means is that it’s good to be good at something.
By John Kay
From the Financial Times
Note:
Sainsbury’s – one of the most popular and profitable chains of supermarkets in the UK.
2. Questions to ponder:
1. What is the point of the story about BMW and its market share?
2. A lot of people think that management is “just common sense”. Why do management gurus exist? What is their real value?
3. Michael Porter states that the worst strategic error is to be stuck in the middle. In the middle of what?
4. What is the “contradiction” between Sainsbury’s strategy and Porter’s theory?
5. How did Porter explain Sainsbury’s strategy?
3. Which of the three words in each case does not fit the definitions of the terms used in the article:
1. There is a contradiction when two or more approaches...
a) agree.
b) do not agree.
c) cannot all be right.
2. Mediocrity is when things are...
a) ordinary.
b) excellent.
c) nothing special.
3. An injunction is kind of...
a) instruction.
b) crossroads.
c) advice.
4. A proposition is a kind of...
a) idea.
b) theory.
c) decision.
5. A shifting concept is an idea that, while you are using it...
a) changes.
b) stays the same.
c) is disproved.
4.
a) Match the words to build new word combinations:
| 1. to be | a. average |
| 2. clearly | b. stuck |
| 3. return on | c. television. |
| 4. market | d. school |
| 5. luxury | e. position |
| 6. to do | f. investment |
| 7. British | g. in the middle |
| 8. below | h. guru |
| 9. business | i. research |
| 10. to be stuck | j. focused |
| 11. strategic | k. segment |
| 12. management | l. share |
b) Make no more than 3 sentences incorporating all of these word-combinations.
5. Explain in English the meaning of these words:
| 1. To confront | 6. Luxury |
| 2. To succeed | 7. Problem |
| 3. To focus | 8. Strategy |
| 4. To pursue | 9. Market |
| 5. To establish | 10. Investment |
6. Find the synonyms to these words in the text. Check your answers with your teacher.
What are the differences in the synonyms?
Can you make some examples to illustrate their meanings?
1. Prosperous, lucky, fortunate, victorious, famous, wealthy, profitable – …
2. Teacher, instructor, coach, trainer, mentor, educator, lecturer – …
3. Form, year, students, pupils – …
4. Tactics, approach, policy, plan, programme, scheme – …
5. Accomplishment, achievement, act, deed, operation, behaviour – …
6. Difficulty, trouble, dilemma, complication, question, puzzle – …
7. Direction, instruction, formula, prescription, method, process, procedure, technique– …
8. Mistake, inaccuracy, oversight, omission, fault, flaw, slip – …
9. Counselor, master, guide, adviser, tutor, confidant – …
10. Opposition, negation, denial, contravention, conflict, clash – …
7. Find all the irregular verbs in the text and compose sentences of your own using them.
8. Find out all the adjectives in the text and give their three degrees of comparison.
Example:
Nice – nicer – the nicest
Dangerous – more dangerous – the most dangerous
9. A Team Brainstorming Game!
Divide in two teams. For every round of the game there is a set of two companies to work with which is presented below.
Each team gets one company and has to write 8 adjectives characterizing its business. As soon as both companies are ready, they read their characteristics out loud.
After that – the teams get together and work out 5 adjectives that would characterize the work of both of these companies.
(Optional: As a teacher you may help your students to distribute the parts in the group. For example, one person could write the adjectives, another may be an announcer and one more person could give short explanations and comments on the chosen words.)
Sets of companies:
1. BMW versus Jiguli car makers
2. McDonalds versus Il Patio restaurants
3. IKEA versus Chippendale furniture producers
4. Lindt chocolate factory versus Red October chocolate factory
KEY:
4. 1. b; 2. i; 3. f; 4. l; 5. k; 6. i; 7. c; 8. a; 9. d; 10. g; 11. e; 12. h
6. 1. successful; 2. professor; 3. class; 4. strategy; 5. performance; 6.. problem; 7. recipe; 8. error; 9. guru; 10. contradiction