Competitive and Corporate Strategy by Cliff Bowman and David Faulkner

by Paul Simister on April 13, 2011

Competitive and Corporate Strategy” by Cliff Bowman and David Faulkner is a terrific book. This lost classic is my all time favourite book about business strategy.

It is even better than Michael Porter’s exceptional books “Competitive Strategy” and “Competitive Advantage” which did so much to make strategy such a compelling subject.

Sadly Competitive & Corporate Strategy Is Not In Print

Unfortunately this 1996 book doesn’t seem to have been a commercial success and is not currently in publication although old and second-hand copies should be acquired as soon as you see the opportunity although they can be expensive.

This “Competitive and Corporate Strategy” book really is that good!

I don’t understand why Exploring Corporate Strategy was the standard text book for MBA strategy courses in the UK when a book this good and practical is available.

Who Are The Authors – Cliff Bowman and David Faulkner?

At the time of writing Competitive and Corporate Strategy, Cliff Bowman was senior lecturer in Strategic Management at Cranfield School of Manchester but he is now Professor of Strategic Management at Cranfield.

David Faulkner was tutorial fellow in management at Christ Church, Oxford but he is now Professor of Strategy at the Royal Holloway, University of London.

Who Is Competitive And Corporate Strategy Aimed At?

It is written as a practical academic book.

The back cover says “Competitive and Corporate Strategy” is ideal for strategic management, corporate strategy and business policy courses at MBA and undergraduate levels as well as senior managers.

I agree. Some prior knowledge of business strategy is useful but not essential.

It's not competitive and corporate strategy

This book shares some of the content

If you can’t get your own copy of Competitive and Corporate Strategy then this book by Cliff Bowman, Strategy In Practice shares some of the same ideas with the emphasis on planning and implementing strategy in the real world.

Why Is Competitive and Corporate Strategy So Good?

Instead of just taking the tried and tested strategic models that were around at the time, Competitive and Corporate Strategy takes them as the base and then looks to either extend the analysis or to apply the ideas in different ways.

I read a lot of books on competitive strategy in the nineties and when I did my MBA, my favourite subjects were business strategy and marketing where there is a lot of cross over at the strategic marketing level.

So much of this book has entered the my way of thinking and the way I look at business strategy and this book was my first introduction to the ideas of customer value and how differentiation could be operationalised.

Summary of Competitive and Corporate Strategy

I feel frustrated that I can’t send you off to buy a copy of this excellent book so while I will give you a taste of what is included I think I will have to blog about some of the core concepts and reference them back into this book review.

Chapter 1 sets the scene and defines some of the building blocks.

Central to this is the concept of value. The value of a product or services is defined by whatever the customer perceives it to be based on how well their needs will be met and the benefits of meeting those needs and wants. It introduces the idea of hygiene and motivating factors for determining customer value.

The Customer Matrix

Chapter 2 introduced me to the idea of the customer matrix which is the relationship between the value the customer perceives and the price of the product or service, or more accurately the perceived price.

One of essential factors to get into your mind is that it is the customers perception that matters so if you are marketing or selling, it is your responsibility to make sure that the customer recognises all the elements of value that are important to them.

You add value by improving the perception along one or more of the dimensions of value that make up the assessment. Ask anyone why they bought something and it will probably come down to about five factors.

This chapter on the customer matrix also brought in a notion similar to the Hertzberg hygiene motivation theory. Some factors have to be at a certain minimum standard but don’t add value beyond that, others continue to be appreciated as they get better.

It also looks at Bowman’s Strategy Clock which outlines the strategic options for moving around in the customer value map and the supporting customer matrix.

The Producer Matrix

Chapter 3 focuses on the producer matrix which you can see as an adaptation of Michael Porter’s value chain concept.

You can see the customer matrix as the way the company functions in the marketplace but the producer matrix shows the internal realities as it combines costs with capabilities.

If two firms have the same capabilities, then the one with the lower costs has the competitive advantage but if one firm has a capability advantage which is relevant to and a factor in the customer matrix, it is likely to have the upper hand.

So if you want to increase your performance in the customer matrix, you have to add capability in the producer matrix, either by improving internal processes or finding a way to buy in the capability from an external source.

Can you see how clever this is and the way it links both external and internal aspects of your competitive strategy?

This chapter also build on the resource based theory of strategy in terms of whether your capabilities will be quickly imitated or lose strategic value in other ways.

Strategic Pathways

Chapter 4 looks at combining positions between the customer matrix and producer matrix.

You can’t play the high price, high value game unless you have superb capabilities that deliver on all the promises your marketing makes to customers.

You can’t play the low price game if you have high costs relative to your competitors.

Can you see the way that the customer matrix and producer matrix combine and stop you creating marketing strategies and operational strategies that do not add up.

These first four chapters of “Competitive and Corporate Strategy” are so powerful that it really is a waste that you cannot click to Amazon and buy.

The Rest of Competitive and Corporate Strategy

I haven’t done the ideas in the chapters justice and I don’t have time to go into more details about what else is included in this superb book other than to list the chapters.

* Chapter 5 The Competitive Environment

* Chapter 6 The Future A Turbulent World (an introduction to scenario planning)

* Chapter 7 Strategy and Structure

* Chapter 8 Strategy and Culture

* Chapter 9 Managing Strategic Change

* Chapter 10 The Nature of Corporate Strategy

* Chapter 11 Selecting The Business Portfolio

* Chapter 12 The Scope of The Corporation

* Chapter 13 Resourcing The Self-Sufficient Approach

* Chapter 14 Resourcing Joint Development

* Chapter 15 Controlling The Corporation

* Chapter 16 International Corporate Strategy

* Chapter 17 Summary & Conclusions

I’m A Competitive Strategy Person

I learnt a long time ago that I am a competitive strategy person interested in helping companies learn to compete more effectively and win customers from competitors through differentiation.

Unfortunately I have seen too many groups do more harm than good so I have been sceptical or corporate strategy, both in terms of the ideas and in particular the way those ideas are put into practice.

It’s not the purpose but my experience is that I’d much rather compete against a subsidiary of a bigger company than against a motivated entrepreneur. Big wallets only go so far and often bureaucratic structures destroy innovation.

But “Competitive and Corporate Strategy has the special knack of making me interested in corporate strategy as well as competitive strategy.

Instead of just seeing it as ways of “arranging the deck chairs on the Titanic” I see how an effective corporate strategy can bring real synergies and strengths into individual business units and make them more competitive.

Of course it is easier said than done and it depends so much on the personalities and the management style of the group.

Rating of Competitive and Corporate Strategy

This Competitive and Corporate Strategy book by Cliff Bowman and David Faulkner is right at the very top of my list and fully deserves my five star rating.

I have never compiled a top 5 business books list but I believe that this book would be in it and on my current thinking would make the top 3.

It is simple enough for me to remember many of the ideas and use them in my work but complicated enough for me to keep wanting to go back and re-read sections of “Competitive and Corporate Strategy” and when I do, something else always clicks.

Cliff Bowman and David Faulkner are to be congratulated for writing a superb book which in some ways should be on the shelf of every MD/CEO of a reasonable sized business upwards.

But in some ways I’m glad that “Competitive & Corporate Strategy” is so difficult to find because I’ve got my copy and it gives me a competitive advantage.

Buying A Copy Of Competitive And Corporate Strategy

While the book isn’t in current publication, you can still find copies of Competitive and Corporate Strategy although it may be necessary to buy second-hand and prices can be high.

Both Amazon.com and Amazon.co.uk (affiliate links) have copies available at the time of writing.

It won’t surprise you that “Competitive and Corporate Strategy” is on my list of best strategy books.

Paul Simister is a business differentiation coach who helps small business owners to profit from differentiating their businesses, being distinctive in the eyes of their customers and standing out in a crowded marketplace.

You too can move past your profit tipping point (free report) by answering the seven big questions of business success.

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