“What is Strategy?” Millions of students and professionals have read Michael Porter’s famous Harvard Business Review article that explains how successful corporations weave focused actions into the fabric of the organization. These companies build competencies and capabilities to maintain advantages that defend profits from being taken by competitors or collaborators.
This course answers, “Which strategy, and why?” The course teaches to first understand the opportunity and competitive dynamics provided by an industry. I learned why certain industries are fundamentally attractive or unattractive to operate in, largely by applying the Six Forces model originated by Porter in case discussions and group projects. To understand what strategies are available within a company, the course delved into examples of corporate-level, business-level, and functional-level decisions, constantly questioning how well the strategy served the company in the industry’s external environment.
The single most important thing I gained from this course is why industry attractiveness is so important. Imagine a market opportunity that’s apparent to incumbent firms, companies in adjacent industries, and start-ups. It’s easy to assume the players could have fair fight for the profits involved, with the winner determined by executing business fundamentals such as hiring, product development, and marketing. Now I understand that industry structures determine which industry’s firms will capture the profits, and only some types of innovations change the attractiveness of an industry.
Another course concept that is critically important in Silicon Valley is that of disruptive innovation. I’m hesitant to admit that I did not completely gasp this concept after many years of working in Silicon Valley, but I was comforted by learning about the disk drive industry, where the leading companies failed to react to wave after wave of disruptive innovation. This class taught Clayton Christensen’s framework, which differentiates between sustaining innovations, which immediately serve an industry’s current customers, with disruptive innovations, which initially serve a low-end market that is unimportant to incumbent firms. When innovative technology matures to serve the high-end market, the only firms that can effectively compete are those that entered the low-end market to develop competency with the innovation.
Introduction
This was the final course of my MBA program at Santa Clara University. This course provides an overview of strategic analysis to students who have completed the MBA program’s other required courses. In Santa Clara’s program, almost all students complete this program shortly before graduating. Some opt to write a Master’s thesis instead.
Instructor profile
Tammy Madsen has approximately 15 years of experience as a business strategy academic, and she currently serves as chair of Santa Clara University’s management department. She has almost encyclopedic knowledge of concepts and developments in organizational strategy. At the time of this writing, Professor Madsen one of three instructors who regularly teach the Capstone course at Santa Clara.
Classroom experience
Every class began with a discussion of recent corporate news, with topics volunteered by students. Most sessions then included a lecture and a case discussion. Each part involved a lot of student participation, yet moved quickly. About six sessions included class participation exercises, lasting only a few minutes each.
The focus of class time was teaching strategic analysis topics using the case method. Each session demanded the constant attention of every student. Students who had read the day’s case had constant opportunities for class participation. Although this course’s most infamous content is the capstone project, project discussion did not use much classroom time.
Coursework, exam, and grades
Approximately one third of grade was determined from the capstone project, another third from class participation, and the remaining portion derived from two smaller group projects.
The capstone paper is a very large analysis and writing assignment, typically totaling more than seventy pages including exhibits. The paper must follow a detailed structure provided by Professor Madsen, which prescribes a structured strategic analysis of a strategic decision announced by a major company. In brief, the analysis is divided into an external evaluation of the industry, an internal analysis of the firm, and specific recommendations.
The capstone project requires a lot of writing and review, but there are obvious ways to effectively divide the work among a team. Project success seems tied to essential team functions such as adhering to a schedule, reviewing each other’s work, having effective meetings, and appropriate use of technology. The course moved at a fast pace, so the capstone project is easier for teams who can get through the early stages of group dynamics quickly.
In other words, my team did well on the capstone project because we had worked effectively together in previous classes.
Class participation activities were simple but difficult. Some points came from participation exercises, which required students to quickly apply a course concept to one of the course readings. These exercises were hard enough that they could not be “faked” by students who skipped previous readings or lectures, and generated a significant variance among the prepared students.
The two small team assignments were structured as fairly typical MBA team case assignments. Each team was required to submit a paper for each case, and give a presentation to the entire class for one of the cases.
Criticisms
My only regret is that I did not learn this material earlier! In a part-time MBA program, most students are actively managing their careers while spending three to six years taking classes. The learning from this course, especially the external analysis portion, is helpful for continual networking and career planning.
Recommendation
Santa Clara MBA students should take this class from Professor Madsen. A student will get the most out of the class by taking it as early as possible and by forming a capstone team before the first class session.
Trailer
This article was first written in 2011 by Dylan Salisbury for dylansalisbury.com. All rights reserved. I added this paragraph because spam blog sites pick up copies of my blog posts.
For a list of course reviews and a disclaimer, visit my Course Reviews page.
