Good strategy takes into account the external environment from "summary" of Good Strategy Bad Strategy by Richard Rumelt
A good strategy does not exist in a vacuum. It must be grounded in a deep understanding of the external environment in which the organization operates. This external environment is made up of various factors that can have a significant impact on the success or failure of a strategy. These factors can include technological advancements, economic conditions, regulatory changes, competitive dynamics, and societal trends. Ignoring the external environment when formulating a strategy is a recipe for disaster. It is akin to setting sail without taking into account the weather conditions or the direction of the wind. Without a clear understanding of the external environment, a strategy is likely to be based on flawed assumptions and wishful thinking rather than on a realistic assessment of the challenges and opportunities that lie ahead. To develop a good strategy, one must carefully analyze the external environment to identify key trends, uncertainties, and potential disruptions. This analysis can help to uncover hidden opportunities and threats that may not be immediately apparent. By taking into account the external environment, a strategist can better anticipate changes in the competitive landscape, customer preferences, and regulatory requirements. Moreover, considering the external environment can help a strategist to assess the organization's strengths and weaknesses in relation to the opportunities and threats present in the external environment. This analysis can provide valuable insights into how the organization can leverage its strengths to take advantage of opportunities or mitigate its weaknesses to address threats.- A good strategy is one that is informed by a clear-eyed assessment of the external environment. By understanding the forces at play outside the organization, a strategist can develop a plan of action that is both responsive to external changes and aligned with the organization's capabilities and goals. This approach can help to ensure that the strategy is realistic, achievable, and well-suited to the challenges and opportunities that the organization faces.
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