Harvard Business Review

Transforming corner-office strategy into frontline action

In today's rapidly changing world, companies must integrate decentralized decision making with coherent, strategic action. A well-crafted, skillfully implemented strategic principle lets them strike that delicate balance.

By Orit Gadiesh and James L. Gilbert

Published on May 01, 2001
min read


The full version of this article is available on Harvard Business Online (subscription required). The Idea in Brief Southwest Airlines keeps soaring. Its stock price rose a compounded 21,000% between 1972 and 1992 and leapt 300% between 1995 and 2000. Why does Southwest succeed while so many other airlines fail? Because it sticks to its powerful strategic principle: "Meet customers' short-haul travel needs at fares competitive with the cost of automobile travel." This pithy, memorable, action-oriented phrase distills Southwest's unique strategy and communicates it throughout the company. An effective strategic principle lets a company simultaneously: maintain strategic focus, empower workers to innovate and take risks, seize fleeting opportunities, create products and services that meet subtle shifts in customers' needs. In today's rapidly changing world, companies must integrate decentralized decision making with coherent, strategic action. A well-crafted, skillfully implemented strategic principle lets them strike that delicate balance. Read the full article on Harvard Business Online.

The full version of this article is available on Harvard Business Online (subscription required).

The Idea in Brief

Southwest Airlines keeps soaring. Its stock price rose a compounded 21,000% between 1972 and 1992 and leapt 300% between 1995 and 2000.

Why does Southwest succeed while so many other airlines fail? Because it sticks to its powerful strategic principle: "Meet customers' short-haul travel needs at fares competitive with the cost of automobile travel." This pithy, memorable, action-oriented phrase distills Southwest's unique strategy and communicates it throughout the company.

An effective strategic principle lets a company simultaneously:

maintain strategic focus,
empower workers to innovate and take risks,
seize fleeting opportunities,
create products and services that meet subtle shifts in customers' needs.

In today's rapidly changing world, companies must integrate decentralized decision making with coherent, strategic action. A well-crafted, skillfully implemented strategic principle lets them strike that delicate balance.

Read the full article on Harvard Business Online.