Modern Strategy and Hinduism: Finding Parallels

Strategy used to be about protecting your existing competitive advantage. Today, it’s about finding the next advantage. Strategy starts to decay the moment it’s created. That’s why corporations must develop strategies that address tomorrow’s business realities. Strategic actions that companies take belong in one of three boxes:

Box 1 = managing the present
Box 2 = selectively abandoning the past
Box 3 = creating the future

The first box is about improving your current businesses. Boxes 2 and 3 are about innovation, breakout performance, and growth. Most organizations restrict their strategic thinking to Box 1. Leaders are focused on cost reduction and margin improvement, especially during a serious downturn. But strategy must include Boxes 2 and 3 as well. Leaders must address what their companies need to do to sustain leadership in the long term. In fact, innovation is more — not less — important right now. Wal-Mart’s transformation of the discount retailing industry, Apple’stransformation of the music and phone industries, and Southwest Airlines’ revolution in the airline industry provide good examples of successful Box 2 and Box 3 initiatives.

Industries transform and change as a result of customer discontinuities and nonlinear shifts in technology. For example, nanotechnology and genetic engineering are revolutionizing the semiconductor and pharmaceutical industries. Globalization is opening doors to emerging economies, most notably India and China, and billions of customers with vast, unmet needs. Once-distinct industries, such as mass-media entertainment, telephony, and computing, are converging. Rapidly escalating concerns about security and the environment are creating unforeseen markets. Other, more subtle changes are important as well, such as the trend toward more empowered customers, the rising middle class in the developing world, and the aging population in the developed world.

As a result of these forces, companies find their strategies require almost constant reinvention. Old assumptions are no longer valid, the previous strategy has been imitated and commoditized by competitors, or changes in the industry environment offer unanticipated opportunities. The only way to stay ahead is to innovate. It’s the responsibility of executives to make money with the current strategy. That’s the challenge in Box 1. It’s also their responsibility to make up for the decay and commoditization of strategy. That’s the challenge in Boxes 2 and 3, but too many companies ignore these boxes until it is too late.

In some ways, to understand these three boxes is to understand Hinduism . Though the Hindu religion recognizes 330 million gods, there are only three main Hindu deities: Vishnu, the god of preservation; Shiva, the god of destruction; and Brahma, the god of creation. The correspondence between the three boxes and the three Hindu gods is clear.

Box 1 = preserving or managing the present: Vishnu
Box 2 = destroying or selectively abandoning the past: Shiva
Box 3 = creating the future: Brahma

According to Hindu philosophy, preservation-destruction-creation is a continuous cycle without a beginning or an end. The three gods play an equally important role in all three phases of that process. Further, Hinduism states that, while changes in the universe can be quite dramatic, the processes leading to changes are often evolutionary and involve smaller steps.

This is just the challenge for large companies: to create their future while managing their present. To take small steps that lead to big change. How good is your organization in managing the preservation-destruction-creation cycle?