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Note the sequence that Koch lays out. What comes first Thought. Then hypothesis and experimentation. Look what comes fourth: success. In the art of what works, success comes first. It launches strategy. You study success in similar situations, and that shows you the path to take. Koch s sequence follows a common view of the scientific method. Doesn t it start with thought No. As Kuhn, Bacon, and other scientists tell us, science starts with the successes of other scientists. You study what worked in the past, and a coup d oeil shows you what path to take next. Once again, we are back to the question of where a goal comes from in the first place. In Strategic Leadership, Sydney Finkelstein and Donald Hambrick ask it this way:12

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There is only one condition under which a furnace or its heat exchanger must be replaced: when the walls in the heat exchanger that separate the circulating air from the hot exhaust gases deteriorate because of age, premature corrosion, or cracks and thus allow the exhaust gases to mix with the circulating air Included in the exhaust gases is carbon monoxide which is poisonous The mixture of air and exhaust gases circulating around the house is quite dangerous The life expectancy of a furnace refers to the average number of years of usage that can be expected before the walls of the.

From where does the company s strategy come . . . Is it an incremental variation of the company s prior strategy Which in turn raises the question, from where did that strategy come

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Buy safes at good prices, and sell them at a reasonable markup. Don t worry about not having the lowest prices in town. Marketing for peak profits involves adjusting the prices of products to meet the needs of customers and the needs of your company. Adjustments in prices mean adjustments in the customer s perception of prices. Prices should be based on perceived value. Many customers

Although Koch points to thought, his fellow scholars of the flexible school don t care very much where the strategy starts. It will only change anyway, right You end up at the right place, no matter where you start from. We find one reference to the contrary. In Strategic Flexibility, Kathryn Harrigan counsels companies to follow the lead of Mao Tse-tung, who conquered China against all odds:13

options. (Courtesy Adesco Safe Company.)

Mao would not fight unless he saw an opportunity to seize an advantage. Mao s strategy was . . . fighting only when the chances of success were high, thereby avoiding battles he could not hope to win.

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will choose a more expensive product because they believe in the adage, You get what you pay for. Some customers always refuse to pay the sticker price; they feel better if they dicker the price down. You need to price your safes so that all types of customers will feel that they re getting a good deal. One way to do this is to price most items with a little room for dickering. It s a good idea to price so that you can negotiate slightly such as by giving a 2 percent discount for cash payment. Be careful about lowering your prices, however. Every attempt should be made to sell the safe at sticker price. If the customer objects, point out the safe s benefits and features. Keep in mind that you re selling a specialty product that will protect the valuables and keepsakes of a family or business. Make it clear that you re selling a high-quality product. One major safe dealer emphasizes the importance of quality by displaying a cheap fire safe that had been broken into.

So Mao fought just like Napoleon, and Harrigan, like von Clausewitz, counsels companies to do the same. Take action only when you see a chance for success. But overall, the school of strategic flexibility does not care much how strategy starts, and it does not tell you when to change your goal or activities. It tells you to be flexible, but it does not tell

The most successful safe dealers take every opportunity to talk up their safes. Whenever someone buys something at your store, ask if they need a safe. And ask during every service call. Be prepared to talk about the benefits of buying one of your safes convenience, protection, and peace of mind. Explain that you install and service your safes. Even if the person isn t ready to buy one now, he or she will remember you when he or she is ready to buy.