This week, I plan on profiling classic books that every leader should take the time to go back and read. Actually, I'm going to feature a pair of books each day, focusing on books that complement one another well or provide for an interesting contrast in viewpoints on leadership and strategy.
For today, the books are Michael Porter's classics on strategic management. In 1980, Porter published the classic book, Competitive Strategy. While tons of books have been published in this field over the past three decades, this book remains the foundation of a vast amount of thinking on strategy. The "five forces" framework became ubiquitous and continues to be a great starting point for any strategic analysis. In 1985, Porter followed up his earlier work with Competitive Advantage, a book that introduced the world to the concept of generic strategies. Porter argued that firms must choose between differentiation and low cost strategies, and that attempts to straddle both positions can lead to being "stuck in the middle" with no clear competitive advantage. Porter argued too for the importance of making trade-offs, rather than trying to be all things for all people.
Everyone should take the time to return to this seminal work from time to time, to recall the critical lessons that Porter offered regarding how to analyze a company's competitive landscape, craft a distinctive position, and create and sustain competitive advantage. His simple and clear frameworks provide a very useful starting point, even today, for any leader trying to assess his firm's competitive position and formulate a strategy for the future. Many have argued against Porter's ideas over years, but in many ways, these efforts prove the value of these classic works. When volumes have been written attempting to contrast new ideas with your original arguments, you know that you have penned a classic must-read for all leaders.