Gary Hamel and CK Prahalad, Competing for the Future
Hugely influential thinkers in corporate strategy.
Hamel (an Amercan, pictured right) runs the management consultancy business,
Prahalad (born in India, pictured right below) was a business school professor in
Michigan,USA, who died in 2010.
Gary Hamel and CK
Prahalad in the Management Gurus section.
How to be successful in business
1. Exploit “core competencies” and create new ones
Core competencies are:
- skills and technologies in business activities (like
production, customer service and innovation) that make a company uniquely better than its competitors.
- big long-term contributors to customer perceived value.
- gateways to tomorrow’s markets (so satisfying future customers)
An example is Sony’s ability to miniaturize leading to
successful products like the Play Station.
2. Strategic intent
This is an inspirational and challenging statement of an organization’s purpose that gives:
- direction - focus on the future.
- discovery - finding new industries and customers.
- destiny - a belief in something worthwhile that gives customers a better
For example in the photocopier market Canon’s strategic intent was ‘Beat Xerox’.
3. Create the future
To create the future a company must do one of these:
a) invent new industries
(as Apple did with the PC).
b) reinvent existing industries by:
- fundamentally changing how an industry is run (as Amazon did
with book selling), or
- re-drawing industry boundaries (e.g. ‘edutainment’ mixing education and
A company must ask itself what it wants its industry to be like in 5 to 10 years time.
So, during that time period, it must anticipate and resolve the company’s key concerns:
- channels of distribution.
- competitors and core competencies.
- profit margins.
- sources of competitive advantage.
Such planning and foresight will achieve revolutionary results (profitably exploiting the
future first) through evolutionary change, driven by calm urgency (not forced by a crisis).
4. Expeditionary marketing
This discovers tomorrow’s market opportunities by finding imaginative and creative
solutions to customers’ future problems faster than competitors.
This means amazing future customers by:
- anticipating and satisfying their future needs (so becoming the industry’s
- being “benefits driven” (bringing “unanticipated benefits to humankind”).
- believing quality and continuous improvement aren’t enough – you need to be different, not
Customers’ needs may be clearly stated by them through market
research (articulated needs).
But sometimes customers can’t explain their future requirements (unarticulated needs), because a product is so
revolutionary and out of their experience.
So an innovative company (like Apple) may successfully sell the product without prior customer
5. Creative and committed employees
Employees make core competencies and customer satisfaction possible.
They must be empowered to take responsibility for results through:
(accepting that managers as well as employees are to blame for failure).
b) empathetic and ethical management
(leading to mutual trust and respect).
c) dedication to the organization’s purpose
“Community activists” are vital, because they combine change with commitment.
d) vision and stretch goals
(to “challenge employees to accomplish the seemingly impossible”)
e) inspirational organizational purpose
A “shared sense of direction” is crucial to stop empowerment turning into chaos.
f) avoid redundancies (if you can)
- can lose your best talent.
6. Productivity improvement and resource leverage
Successful businesses get to the future first and for less by:
- using resources to maximize present and future customer satisfaction (“resource
7. Continuous learning
- discard (or unlearn) obsolete practices and policies but keep the good of
the past like company values.
- benchmarking – humbly seek solutions from the world’s best organizations.
- genetic variety – create a curious and innovative workforce of “community activists” who
consistently challenge the status quo with new revolutionary ideas.
8. Strategic architecture
This is how a company makes the future a reality through:
- information architecture – information technology and communication
- social architecture – accepted values and behaviour.
- financial architecture – accounting systems.
- strategic architecture – top management’s strategy to achieve present and future customer
Key quotes on human resource management
What employees hear is that they’re the firm’s most valuable assets, what they know is that they’re the most
Downsizing, the equivalent of corporate anorexia, can make a company thinner, it doesn’t necessarily make it
Key quote on finance and cost control
A company must not only get to the future first, it must get there for less.
Key quote on innovation
See the future before it arrives.
Key quote on business success
In business, as in art, what distinguishes leaders from laggards, and greatness from mediocrity, is the ability
to uniquely imagine what could be.
Key quote on customers
Companies that create the future do more than satisfy customers, they constantly amaze them.
Key quote on competitive advantage
A company surrenders tomorrow’s businesses when it gets better without getting different.
Key quote on strategy
The genesis of the strategy process must be a purposely created misfit between where the firm is and where it
wants to be.
Key quote on the learning organization
A company must unlearn much of its past before it can find the future.