Strategy as Simple Rule

Topics: Company, Companies, Strategic management Pages: 4 (1371 words) Published: December 22, 2013
1. Introduction
Title of the article is ‘Strategy as Simple Rules’ and it was written by Kathleen M. Eisenhardt and Donald N.Sull. The aim is to show how the strategy of simple rule is used in complex business. Yahoo is the company that had successfully used simple rule strategy to be the internet’s top portal. Company can choose among three distinct approaches to strategy and it requires different skill sets and works best under different circumstances. There are five types of simple rules: how-to-rules, boundary rules, priority rules, timing rules, and exit rules. In the article I can assume that there are many advantages of the strategy and below is the analysis.

2. Main Body
2.1 Summary
The article describes how and why companies like Yahoo, Lego, AOL, or Enron use simple rules in a very fast moving market. In the past, companies are able to use complex strategies because of the simple business landscape and stable markets. Nowadays, it is impossible for the strategy to succeed as the markets are not stable. Markets are fast moving and so complex that companies are forced to react and to simplify their strategies. Traditional approach of securing position will not cope in the fast moving markets, because the key is the ability to capitalize on fleeting opportunities. Kathleen and Donald analysed some of the companies in unpredictable and fast moving market. The first company that the author talking about is Yahoo, they has emerged as one of the blue chips of the new economy and as the internet’s top portal while they can also generates profit. The success is not easily explained using traditional thinking. Many people assumed that attractive industry helped Yahoo but actually the market is a strategist’s worst nightmare. The company used very simple strategy which is to grab opportunity as fast as possible. Analysts are not clear about Yahoo’s strategy. Company like Yahoo often accused of lacking strategies, or in the other words a company without a...
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