Seven Strategy Questions by Robert Simons

I finished this book in April 2025. I recommend this book 6/10.

Why you should read this book:

Robert Simons draws up some of the core strategy principles from his long career as a Harvard Professor. I could recognize most of the principles from his online Strategy Execution class I took last year. The seven strategy questions from the book will help you ensure you get your people pointed in the right direction.

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🚀 The book in three sentences

1. Make it clear to people what success looks like; what is the target?

2. Show everyone the 7 measures, and tell them what you don't want them to do.

3. Make everyone help each other across teams to succeed.

   
   

📝 My notes and thoughts

• P5. Seven Strategy Questions:

  • Who is your primary customer?

  • How do your core values prioritize shareholders, employees, and customers?

  • What critical performance variables are you tracking?

  • What strategic boundaries have you set?

  • How are you generating creative tension?

  • How committed are your employees to helping each other?

  • What strategic uncertainties keep you awake at night?

• P32. Here's a follow-up question to ask yourself and your colleagues when considering how to allocate resources correctly: does everyone know what your primary customers value? It's not enough that people in your marketing department or a few senior executives share this knowledge. You must constantly remind everyone—from the top of your organization to the bottom—of the importance of truly understanding and responding to your customer's needs.

• P40. If there is uncertainty about your primary customer, it can mean only one thing: you are diverting and wasting resources that you should dedicate to your customer. By bringing clarity to your choice of primary customer, understand what that customer values, and then organizing your company around those needs, you strengthen your company's ability to compete for—and win—that customer.

• P63. The core value in any business is choosing whose interests come first when faced with tough decisions and trade-offs. If your core values are providing guidance, you won't have any difficulty telling stories of situations where they have determined people's decisions. If you can't easily find such stories, then your values are not doing their job.

• P75. Picture yourself five or seven years from now. Instead of envisioning success, imagine the worst. Envision a scene in which your strategy has failed: your products have lost their edge, your competitors have overtaken you, and your best people have left. Imagine that your strategy is in ruins. What could have gone wrong? What could have caused this disaster? Warren Buffett uses this extensively. His advice: "Invert, always invert. Turn a situation or problem upside down. Look at it backward...What happens if all our plans go wrong? Where don't we want to go, and how do we get there? Instead of looking for success, make a list of how you can fail instead."

• P78. Managers often have difficulty deciding how many measures to hold someone accountable for. This is one area where I can provide an easy answer: seven, plus or minus two. The idea is simple. People can remember seven things (and as many as nine in a pinch). If they can easily recall the measures they're accountable for, the measures will influence the choices they make as they go about their work. This is simple to test. Ask someone who works for you what measures he's accountable for. If his scorecard has fifteen or, twenty-five or forty measures, he will not be able to recall them, and the measures will have minimal impact on his day-to-day behavior. If he's accountable for seven measures (plus or minus two), he'll have no trouble remembering them—and consistently pursuing those goals.

• P91. All leaders can utilize the power of negative thinking. Hire people with passion, inspire them, and give them aggressive goals and incentives. But also tell them what behaviors will get them fired. You should always state boundaries in the negative. This has three benefits. First, telling people what not to do provides absolute clarity about where you have drawn the line in the sand. There is no ambiguity. Second, people pay more attention when you tell them what will get them fired than when you tell them about your lofty new vision and strategy. Finally, defining what is unacceptable gives them freedom to act without constant uncertainty and worry that you might later judge their actions as inappropriate.

• P118. Most of us rate our direct reports above average on performance evaluations. A high score avoids difficult conversations and keeps relationships cordial. It's to live in a world described in Garrison Keillor's radio series, A Prairie Home Companion, where "all the women are strong, all the men are good looking, and all the children are above average." In the real world, not everyone can be above average. And allowing subpar performance to go unchallenged can have insidious consequences. When Hames Kilts took over as CEO of Gillette in 2001, he discovered that more than two-thirds of Gillette executives had been rated in the highest possible category, earning maximum bonuses. Kilts was forced to reconcile these assessments with reality: Gillette had missed its earnings estimates for fifteen consecutive quarters.

• P139. Mary Kay Cosmetics executives believe that their beauty consultants—2 million independent housewives and office workers—are motivated by five things reflected in the acronyms STORM:

  • S: Satisfaction with a task well done (self-worth)

  • T: Teamwork (a sense of belonging)

  • O: Opportunity (to succeed)

  • R: Recognition

  • M: Money

• P148. The people at the top of the corporate hierarchy grant themselves privilege after privilege, flaunt those privileges before the men and women who do the real work, then wonder why employees are unmoved by management's invocations to cut costs and boost profitability. To guard against this danger, Southwest's top executives work out of small interior offices adjacent to their Dallas airport. One industry observer described their accommodations as only marginally nicer than a janitor's closet. For the same reason, Tom Watson Sr., the legendary CEO who built IBM to greatness in his thirty-year tenure, made all managers and executives remove their titles and rank from their office doors and desks and eliminated executives' parking spaces.

• P179. The Seven Questions (With Follow-up Questions).

  • Who Is Your Primary Customer?

    • Does everyone know what your primary customer values?

    • How have you organized to deliver maximum value to your customers?

    • Have you minimized resources devoted to your other constituents?

  • How Do Your Core Values Prioritize Shareholders, Employees, and Customers?

    • What tough decisions have been guided by your core values?

    • Do your core values recognize your business's responsibility to others?

    • Is everyone committed to your core values?

  • What Critical Performance Variables Are You Tracking?

    • What is your theory of value creation?

    • What could cause your strategy to fail?

    • How do you create accountability for performance?

  • What Strategic Boundaries Have You Set?

    • What are your major reputation risks?

    • Does everyone know what actions are off-limits?

    • What strategic initiatives will you not support?

  • How Are You Generating Creative Tension?

    • How are you motivating everyone to think like winning competitors?

    • How do you encourage innovation across units?

    • Have committees and dual reporting made your organization too complex?

  • How Committed Are Your Employees to Helping Each Other?

    • What is your theory of motivation?

    • How are you creating shared responsibility for success?

    • How do your compensation policies affect commitment to help others?

  • What Strategic Uncertainties Keep You Awake at Night:

    • How do you focus everyone's attention on these uncertainties?

    • What system do you use interactively to stimulate change?

    • How do you encourage bottom-up information sharing?