The Crux: FROM THE BESTSELLING AUTHOR OF GOOD STRATEGY/BAD STRATEGY: How Leaders Become Strategists

by Richard P. Rumelt

A FINANCIAL TIMES BUSINESS BOOK OF THE YEAR 'A straight-talking guide to corporate strategy and how to frame and pursue it' Financial TimesThe most important part of a leader's job is to set in motion the actions today that will build a better future tomorrow - in other words, strategy. But how do leaders become strategists?In this ground-breaking book, Richard Rumelt, the world's leading authority on strategy, shows how finding the crux of a challenge is the essence of the strategist's skill. The crux is the key issue where action will best pay off, and Rumelt reveals how to pinpoint it so you can focus energy on what really matters. Drawing on decades of professional and academic experience, and through vivid storytelling of some of the most important business decisions of recent times, Rumelt illuminates how leaders can overcome obstacles, navigate uncertainty and determine the best path forward. Strategy is not about setting financial targets, statements of desired outcomes, or performance goals, it is about finding the crux and taking decisive, coherent action.

Genres: Business, Leadership, Nonfiction, Management, Business Strategy, Audiobook, Psychology

367 pages, Kindle Edition

Published April 28, 2022

About the author

Rumelt’s research has centered on corporate diversification strategy and the sources of sustainable advantage to individual business strategies. His current research interests center on the dynamics of industry transitions with a focus on the patterns and forces shaping the evolution of complex industries.

Rumelt received his doctorate from the Harvard Business School in 1972. He joined the UCLA faculty in 1976. He was President of the Strategic Management Society in 1995-98. He received the Irwin Prize for his book Strategy, Structure, and Economic Performance. In 1997, he was appointed Telecom Italia Strategy Fellow, a position he held until April 2000. He has won teaching awards at UCLA and received a “best paper prize” in 1997 from the Strategic Management Journal.

Reviews

[Zack Rearick · Rating 2 out of 5]

I enthusiastically recommend Good Strategy Bad Strategy: The Difference and Why It Matters to anyone working in business strategy, consulting, or politics/campaigns. It's an important book, highly relevant, and has really impacted my thinking on (1) what strategy actually is and (2) how to go about shaping good strategy. I pre-ordered The Crux and was excited to have fresh material from Richard Rumelt, who I admire tremendously. Unfortunately, I don't think this book contributes or accomplishes much. It's not "bad," per se — at least not relative to the sea of mediocre, filled-with-fluff, dime-a-dozen books in the business/leadership space — but it never approaches the high bar set by Good Strategy / Bad Strategy.

You can pass on this one. Good Strategy / Bad Strategy is still a must-read. Then, if you want more, I would look to books like Humanocracy: Creating Organizations as Amazing as the People Inside Them; Winning on Purpose: The Unbeatable Strategy of Loving Customers; or Emotion By Design: Creative Leadership Lessons from a Life at Nike.

[Sebastian Gebski · Rating 5 out of 5]

Contrary to many other reviewers, I liked The Crux even more than Good Strategy Bad Strategy. Why so? This whole book is 100% dedicated to what so many organizations fail in - understanding what the strategy is and isn't. Rumelt keeps iterating on that, providing examples and patiently repeating the message (American style) to make it last.

TBH I liked the initial chapters more - the message there is striking, e.g., on why strategy can't start with goals. The final part of the book may appear more practical (guidance on how to organize for creating a strategy in the organization), but frankly - if you're an experienced executive and you've read through the initial chapters, you should really be able to figure that out on your own.

To keep the long story short - probably the best book on strategy I know. I easily can recommend it to anyone interested in the topic. It can be read w/o going through GSBS first. Wholeheartedly recommended. My only regret is that I haven't made enough notes, as I was too busy nodding to what Rumelt was saying here.

[Matias Myllyrinne · Rating 5 out of 5]

One of the best strategy books around today. The examples and issues drawn from real life experience make this book a page turner and add context. The style is refined and fluid and the intellect and insight is sharp. I recommend this book to anyone who is involved in working with strategy and interested in the matter.

If you take nothing else away from this work, setting goals is not making a strategy. Management and execution are not strategy. A clear and obvious distinction that so often gets lost in the real world.

[Andrew Carr · Rating 5 out of 5]

Sometimes a book will come along at the right time and place and give your thinking a solid kick. For me, at this time, this was such a book.

Strategy, Rumelt implores his readers 'is not magic'. It's not about setting vast long term goals and aspirations. Instead, it is about solving problems. If the world gave us everything we needed, we wouldn't need strategy. Because we have problems, of varying significance and resolvability, we need strategy to help us sort out what we should do, how to choose, and how to sustain that focus to fix the problems before us.

For some years now, I've been disenchanted with the idea of Grand Strategy, with its emphasis on the long term, the aspirational, the planned, the aesthetically intellectual. For a time, I thought Emergent Strategy was a viable alternative. And while it has much to recommend, especially those authors who've touched on its links to complexity science, it too has its flaws. It can be self-satisfied, or unfocused and often gives up the space for meaningful action. Both Grand and Emergent Strategy seem to be ways of explaining organisational actions, without the word 'strategy' clearly adding something distinct to the day-to-day practices.

Enter 'The Crux'. Rumelt sees strategy as about problem solving, and 'the crux' as the skill of identifying what problems/issues/opportunities are important, what can be actually addressed, and building the focus that enables us to take action over a short-medium term to try and address them.

For me, the value of this was several-fold. First, it helped strengthen my rejection of goal setting . Second, the idea of problem solving as the central issue of strategy is compelling. Third I've long been drawn to Andrew Marshall's notions of Diagnosis as the task of the strategist, and this very much fits within Rumelts framework. Fourth, I now believe that, with some additions, Rumelts framework could help us find a a valuable middle ground between Grand and Emergent strategic ideas. One that retained the sense of deliberate active work of the Grand, while bringing in the richer, more humble sense of shaping environments and cultures of the Emergent. A middle ground that better fits with the ideas of complexity science, recognising that as complex adaptive systems, our institutions are faced with complexity, but that adaption has to be effortful as well.

That said, I could also see others reading this book and seeing it as interesting but not an instant classic. YMMV as they say. For me, this was an inspiring and deeply thought provoking read that has really shifted my thinking in ways I greatly appreciate. So it's a clear 5 stars from me.

[کافه ادبیات · Rating 4 out of 5]

ریچارد رومِلت با ارائۀ مفهومی به نام «گره»، افق جدیدی از نحوۀ اجرای استراتژی را به رویمان باز می‌کند. او معتقد است رهبران زمانی به استراتژیست‌های کارآمدی تبدیل می‌شوند که به‌جای تمرکز بر اهداف، روی چالش‌ها متمرکز شوند؛ یعنی زمانی که بتوانند در تشخیص گره چالش حیاتی‌شان (چالشی که هم بتوان بر آن غلبه کرد و هم نوید بیشترین میزان پیشرفت را بدهد) دقیق عمل کنند و برای فائق آمدن بر آن، دست به اقدام قاطع و منسجم بزنند.

روملت با ارائۀ داستان‌های جذاب با بیانی شفاف و به دور از پیچیدگی، نشانمان می‌دهد چه مهارت‌هایی لازمۀ استراتژیست شدن است؛ داستان‌هایی دربارۀ اینکه ایلان ماسک چگونه گرهی را کشف و باز کرد که پیشران موفقیت اسپیس‌ایکس شد و اینکه ارتش ایالات‌ متحده چگونه به ضعف‌های استراتژی نبردش پی برد و رفعشان کرد. برای نمونه، چالش اصلی ماسک قابلیت استفادۀ مجدد راکت بود. تمرکز شدید او بر فرود آرام راکت‌های اسپیس‌ایکس امکان استفادۀ مجدد از آنها را فراهم کرد و هزینۀ ارسال محموله‌های فضایی را به‌شدت پایین آورد. استراتژی ماسک بر نحوۀ ارزش‌آفرینی یا نحوۀ جایگاه‌یابی اسپیس‌ایکس در صنعت هوافضا استوار نبود. استراتژی او طرحی عملی بود، تدبیری ذهنی که انرژی شرکت را بر موضوعی متمرکز ‌کرد که با درک گره و ارائۀ پاسخی مؤثر و راهگشا، تأثیر بسزایی بر این صنعت گذاشت.

[Rafael Ramirez · Rating 4 out of 5]

Sin duda, un libro interesante, escrito por una de las más grandes autoridades de la actualidad en el campo de la estrategia de negocios.

Como nos recuerda el autor, la estrategia de una empresa no consiste en definir una serie de métricas operativas y financieras (estas deben fluir de y ser consistentes con la estrategia, pero no constituyen en sí mismas la estrategia), tampoco consiste en tener claridad en la visión y la visión de la organización (aunque muy de moda, no suelen ser más que slogans medianamente útiles para motivar a los colaboradores y, en la gran mayoría de los casos, son tan genéricos, que no tienen ningún valor práctico).

La aportación principal del libro es la idea que la estrategia de una empresa consiste fundamentalmente en tener claridad sobre cual es el peligro o la oportunidad más importante que enfrenta en el corto y mediano plazo (el "crux" o punto capital del título) y en definir qué es lo que se debe hacer para superar dicho peligro o aprovechar dicha oportunidad. Como todos los libros de este género, el autor comparte numerosas experiencias de empresas que han sido exitosas aplicando estas ideas.

Ahora bien, el libro es demasiado largo para lo que pretende, en momentos se vuelve un conjunto de bosquejos de situaciones empresariales, sin un hilo conductor muy claro. Por otro lado, el autor dedica una gran parte del texto a dar ejemplos que intentan desacreditar otras teorías académicas en el campo de la estrategia, con criticas más o menos válidas, y en el último capítulo parece que lo que busca es promover su propia práctica de consultoría. A pesar de esto, es un libro que vale la pena leer, especialmente para los directores de empresa que busquen desarrollar estrategias con una mayor probabilidad de éxito.

[Ahmad hosseini · Rating 4 out of 5]

I had and have problem with strategy. There was a black spot in my mind how to start about the strategy and how leaders prepare options for making a strategy. So, Richard Rumelt solved this problem for me.
“Strategy creation is a special form of problem solving. By a form of problem solving, I mean that it treats much less structured and much more complex problems than you found in the traditional homework problems of your school days.”
Based on this book strategy starts with understanding and diagnosis the issues and situation you have. So, it means you must examine your situation and find what is the most important issue you are dealing with it right now. After finding the most important challenge it is time to focus on it and try to define actions to overcome it.
“A strategy is a mix of policy and action designed to overcome a significant challenge.”
Mr Rumelt provides a tool for helping us to have better strategy; Strategy Foundry.
Strategy Foundry: A Strategy Foundry is a methodology designed to help a leadership team break away from treating strategy as goal setting. It is designed to identify the key challenges facing the organization, diagnose their structures, identify the crux, and work out how it can be addressed. The result is clarity on what is critical and an outline of the action steps for dealing with it. Final attention is paid to the public face of the actions chosen.
Book includes a lot of real examples about strategy in different industries. These examples are very insightful and help you understand what is strategy and how good strategy can have huge impact on your business.
“Good strategy is about focus, not about everything that everybody does.”
To be a strategist:
To be a strategist you will need to embrace the full complex and confusing force of the challenges and opportunities you face.
To be a strategist you will have to develop a sense for the crux of the problem—the place where a commitment to action will have the best chance of surmounting the most critical obstacles.
To be a strategist you will need persistence because it is so tempting to grab at the first glimmer of a pathway through the thicket of issues.
To be a strategist you have to take responsibility for external challenges, but also for the health of the organization itself.
To be a strategist you will have to balance a host of issues with your bundle of ambitions—the variety of purposes, values, and beliefs that you and other stakeholders wish to support.
To be a strategist you will have to keep your actions and policies coherent with each other, not nullifying your efforts by having too many different initiatives or conflicting purposes.

[Jamie Bowen · Rating 3 out of 5]

An interesting book on strategy, the majority of the book concentrates on stories and good examples, although it wasn’t until the last two chapters that it all came together for me. Some good frameworks to utilise back in my job.

[Susan · Rating 5 out of 5]

This book demystified strategy making for me and is an excellent intro to the topic. By highlighting what strategy making is NOT, e.g. it’s not visions or goals, not decisions, not management, not financial accounting, the author’s detailed arguments drove many points home. The book is slightly repetitive, but I found it a pretty worthwhile read.

[ronnie · Rating 4 out of 5]

this book as the potential to cause a paradigm shift in movement spaces if activists and organizers can get past the fact that the intended audience seems to be business people and policymakers. victories for the left have been elusive since neoliberalism's decimation of the labor movement, and the white backlash against the civil rights movement (both of which, by the way, were facilitated by inside agents such as union bureaucrats and the black elite, respectively). the george floyd protests in 2020 were inspiring, but clearly we dropped the ball on something when the country responded with DEI trainings instead of justice for victims of police brutality and mass incarceration. i've been reading a series of books to try to understand exactly where in movement history (and in my own work) have us activists succeeded and failed, and WHY.

richard rumelt's the crux helped put it into perspective for me: we do our best work when we design a cohesive response to an addressable challenge by leveraging power against a defined target. so often in movement spaces, and apparently in the business world too, we conflate strategy with statements about our mission, values or goals. we recycle action plans (e.g. petition -> town hall -> protest/rally/march -> public meeting, etc) and deploy tactics to little effect other than gaining a narrow sense of accomplishment. rumelt does a lot to address misconceptions around strategy and by doing so develops his "challenges-based" framework. strategy is a decision on how to punch through a challenge. it's "a reasoned argument about the forces at work in a situation and how to deal with them."

strategy design requires:
-an unbiased* assessment of "where" your power has an advantage--where there's an asymmetry, there's an opportunity that can be turned into an advantage against your potential opponents

-collecting ideas on what group members believe to be the main challenges (imo, democracy and a culture of comradely debate is crucial at this step and hence in designing strategy)

-determining which challenges are addressable and prioritizing them over others--which means taking other issues off the table for now, which i've seen time and again movement groups having a bad habit of not doing, causing the concept of priority to lose meaning, diffusing our work, and getting little accomplished as a result. don't worry - as rumelt writes, "think of strategy as a series of proximate objectives rather than a long-term vision." win what you can now, and use that eventual victory to make harder challenges more addressable.

-from the above, designing an action plan against a clear target, an agent that has the power to effect the change you seek

-commit to following through on the action plan, checking its accuracy and revising the plan as its being executed

this book was a bit long but it's worth it. for activists, i strongly recommending pairing it with Thomas Rick's Waging a Good War, Kevin Young's Abolish Fossil Fuels, and Olúfẹ́mi O. Táíwò's Elite Capture.

*rumelt identifies three biases to control for which i've seen rampant in the movement: optimism bias, confirmation bias, and inside-view bias. overestimating the benefits and underestimating the costs of a plan, favoring information and action that confirms your pre-existing beliefs and opinions, and focusing only on your own experience (instead of the experience of everyone, including of our opponents and anticipating their actions and reactions) do us no good. neither does group-think. and along the same vein, neither does "deference" to individuals based solely on their identity, which is an issue described well in the book Elite Capture.

[Jacek Bartczak · Rating 5 out of 5]

Podobnie jak w pierwszej książce Rummelta mnóstwo kejsów i historii biznesowych (a czasami również polityczno-militarnych). Autor sypie przykładami jak z rękawa. Ta książka jest mniej metodyczna niż "Good strategy, bad strategy". W pierwszej książki było więcej metod na to jak podejść do poszczególnych elementów strategii. W tej jest więcej przykładów.

"The crux" skupia się bardziej na diagnozie - upewnieniu się, że firm w swojej strategii chce ugryźć właściwe wyzwanie. Ważne: całe podejście Rummelta to "challenge based strategy" - strategia powinna wynikać z wyzwań, które stoją przed firmą

Podzielam też to o czym autor pisze pod koniec książki - o obserwacjach jak przebiega praca nad strategią w firmach:
- praca nad strategią nie jest łatwa. Nawet mając sporo danych nad pracą cały czas wisi pytanie "no dobra, mamy XYZ - i co dalej?". Przejście od obserwacji i danych, do podejmowania właściwych decyzji nie jest łatwe - nie ma na to gotowego frameworku, nie da się z tego zrobić czegoś na wzór skryptu rozmowy handlowej. I to jest moment, gdzie część firm odpada,
- zbyt mało uwagi poświęcone na diagnozę, zbyt szybkie przechodzenie do działania. "Od drążenia i dywagacji rzeczy się nie zrobią - trzeba działać, działać!". W większości przypadków w firmie ważne jest szybkie robienie rzeczy. Ale w niektórych momentach warto dzielić włos na czworo i spokojnie przemyśleć w którą stronę powinny zmierzać kolejne kroki.

Mimo, że pierwsza książka podobała mi się bardziej, a "The crux" momentami ciężko się czytało, to daję 5 gwiazdek - osoby z wiedzą Rummelta powinny pisać jak najwięcej.
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[Daniil Lanovyi · Rating 5 out of 5]

One of the better books that I read about strategy. It admits the topic is not easy and doesn't provide a one-size-fits-all solution. The book encourages you to think and not just follow some fashionable framework or formula. At the end of the day, your strategy will only be as good as the people who create and follow it. Invest in people, invest in thinking and the strategy will follow.

“The art of strategy is not finding your one true goal and passionately pursuing it with all your heart and soul in everything you do—that is a type of mental illness called monomania. The art of strategy is not setting higher and higher performance goals for people and using charisma, carrots, and sticks to push them toward attaining those goals—that presumes that someone somewhere knows how to find a way through the thicket of problems the organization actually faces.”

[Rasmus Stoltzenberg · Rating 5 out of 5]

Stellar stuff, as could be expected from Rumelt. Highly recommended if strategy appears as a fluffy, can't quite put my finger on it thing disconnected from the real world, or just as an alternative headline for goals & budgets.

[Wellney Yarra · Rating 2 out of 5]

DNF. The “crux” could have been summarized in 50 pages

[Bjoern Rochel · Rating 3 out of 5]

Not as good as the first one. I feel this could have been a booklet around the strategy foundry and we would still get close to the same value out of it. 90% tells you what strategy isn’t, 5% tells you what’s necessary for strategy to have a chance to succeed and the last 5% admits that we haven’t fully figured out how to get a strategy out of diverse groups of people with competing agendas, but the strategy foundry is the best the author has come up with. If I were to take one page from the book, I‘d probably take the one with the intro questions into the strategy foundry. That‘s likely the most useful bit I got out of this book

[Piotr Jurgielewicz · Rating 5 out of 5]

Rumelt nie zawodzi. Wchodzi jeszcze głębiej w temat strategii niż w poprzedniej (Good Strategy / Bad Strategy). Pokazuje jeszcze dokładniej różnicę między "strategią" w formie wizji, misji itd. stawiając ją w kontrze z "prawdziwą" strategią, czyli stawienia czoła wyzwaniom.
Pokazuje pełen framework, jak to robić.
I kiełkuje mi myśl o pewnym dopełnieniu tego co pisze, gdzie kultura i strategia to dwie strony tego samego medalu, ale to muszę jeszcze przemyśleć.

[Gatot Widayanto · Rating 5 out of 5]

THE BEST BUSINESS BOOK OF 2022

Three reasons why this book is a must read: the most important role of a leader is strategy, there are misunderstandings in understanding strategy and the importance of business excellence. Lots of leaders interpret strategy as a specific target or achievement of a business. It is not a strategy because strategy is related to the fundamental problems (the crux) facing the company and how coherent actions are taken to solve them. In the intro, Rumelt explains very well and clearly using the analogy of rock climbing where a climber must fully understand the right and left footholds, as well as the right and left hand grips on a cliff. He then crawled up considering each foothold and hand grip and the strength to go up. Do not be hasty in setting targets if the fundamental issues are not fully understood.

For myself, reading The Crux has many benefits because apart from being a cool concept, it is accompanied by comprehensive tools. Maybe it's only business professors like Rumelt or Porter or Gary Hamel who can simplify complex business strategies into a framework that is easy to understand and can be applied immediately.
Rumelt also mentioned a number of old school tools which he said were still relevant, for example the BCG Growth – Share matrix for multi-business companies, such as Astra, Sinar Mas and so on.

Because I read The Crux, my approach when having a dialogue with a potential client last Wednesday morning was structured and BLENG! immediately understood by the client. Alhamdulillah. Reading books is very useful.

Someone who works in a certain company, not a consultant, can also use The Crux easily and God willing, his career will go up.

This lesson from The Crux includes four things. First, dealing with strategic issues is how to deal with challenges. Strategy is a journey, not just set and then executed; but both run together, emergent. Business challenges must be focused on actions that can actually be taken which are referred to in this book as ASC (addressable strategic challenges) and then followed by coherent actions.

Second, understand the sources of our strengths by knowing which areas we really differ from the others (see an edge), long and short term innovation and business size. One example is Intel, which was originally a leader in the semiconductor business and then struggled in the small 9nm chip size.

Third, don't be lulled by management tools that aren't actually a strategy. Some executives use terms that seem 'strategic', for example the five forces, growth-share matrix or others without understanding their essence. Even though it's all just management tools.

Fourth, dig as deep as possible until you get the crux, then arrange coherent actions. For example, RyanAir finally realized that the main challenge lies in selecting different flight routes from competitors but having good traffic. Another example is Amazon, which is striving to become the most customer-centric firm on planet earth. Every challenge at Amazon is always packaged with customer priority in its truest sense, followed up in a concrete way.

Gatot Widayanto
Member of BREED (Book Review, Entrepreneur Excellence & Dialogue)
BREED reviews business books on weekly basis, every Wednesday evening, Jakarta Time

[Priit Tohver (storygraph: ptohver) · Rating 5 out of 5]

As someone who has read and written more than his fair share of strategies based on commonly touted "best practice", this book was a liberation. I've always felt there was something miserably wrong with the whole process, because lofty visions rarely translate into meaningful actions. They say strategy is key to long term success but literally anyone can come up with well sounding platitudes about how we are going to be the global leader in customer service etcetc. One can't help but feel there must be more to it. I always assumed the devil was in the implementation: in that it's not so much what goes in the strategy, it's how well you cascade that down into your business units. But if success really boils down to unit level action, why did we bother going through the whole process of crafting broad organization wide statements that can ultimately be interpreted to mean absolutely anything. Rumelt's approach is liberating because it allows you to be much more concrete about what on God's green earth you're actually going to do about a key wicked problem you're facing. It emphasizes systematic problem solving over credo crafting (while allowing for organizational mottos to capture the imagination). The common rebuke to this kind of approach is that this is "just tactics". As if there were some magical big picture out there that would effortlessly cause all our troops to fall just in the right order at just the right time for the next 5-10 years. In truth when I have seen strategies succeed, it's not because of how well worded the sweeping statements were, it was precisely because we drilled down on a sweeping statement to make it into a concrete action plan for the foreseeable future. If that's just tactics, then I would argue we need to become far more tactical, and we sure as hell don't need 25 vague goals or a stretch financial metric to do so.

[Tõnu Vahtra · Rating 4 out of 5]

Strategy is not about setting vast long term goals and aspirations. Instead, it is about solving problems. If the world gave us everything we needed, we wouldn't need strategy. Because we have problems, of varying significance and resolvability, we need strategy to help us sort out what we should do, how to choose, and how to sustain that focus to fix the problems before us.

In this book author is aruging against the misconception that strategy is something on its own that can jump into existence of nowhere. In exactly such scenarios we end up in situations with 20 TOP priorities while achieving maybe 2 of them and wasting a lot of effort along the way (also cited as "positive thinking success theater"). Strategy is merely a means to an end, a method/tool that should help us tackle the challenges that hinder us from reaching our most important goals. If it's something else then it's simply waste. Rumelt's previous book "Good Strategy and Bad Strategy" was one of the best books I've read on strategy which I also recommend when someone asks for books about strategy. This book deals with a very important concept (strategy should be about problem solving) but is much less "dense". Most of the book is about looking at strategy through problem focus and what are the implications of ignoring this connection or what are the conditions that hinder its success (i.e. key challenges must be owned by the key policy makers for effective strategy). The author also proposes The Strategy Foundry concept as the platform for applying strategy for key problem solving which is covered in the last 15% of the book (I would have liked more focus there, but I guess this is because author is also offering this as a commercial service). Definitely useful book but not something that leaves a lasting impression, I would say it mainly complements the Good Strategy and Bad Strategy book.

Key concepts covered (according to book description):
-Strategy is a form of problem solving and you cannot solve a problem that you do not comprehend.
-The most effective leaders become strategists by focusing on the way forward promising the greatest achievable progress—the path whose crux was judged to be solvable.
-You cannot deduce a good strategy from theory. Much of design is a combination of imagination and knowing about many other designs, copying some elements of each.
-To be a strategist you will have to keep your actions and policies coherent with each other, not nullifying your efforts by having too many different initiatives or conflicting purposes.

"A strategy is a mixture of policy and action designed to surmount a high-stakes challenge. It is not a goal or wished-for end state. It is a form of problem-solving—you cannot solve a problem you do not comprehend. Thus, challenge-based strategy begins with a broad description of the challenges—problems and opportunities—facing the organization. They may be competitive, legal, due to changing social norms, or issues with the organization itself.

In performing a diagnosis, the strategist seeks to understand why certain challenges have become salient, about the forces at work, and why the challenge seems difficult. In this work, we use the tools of analogy, reframing, comparison, and analysis in order to understand what is happening and what is critical.

As understanding deepens, the strategist seeks the crux—the one challenge that both is critical and appears to be solvable. This narrowing down is the source of much of the strategist’s power, as focus remains the cornerstone of strategy.

The strategist should understand the sources of “edge,” or power, or leverage that are relevant to the situation. To punch through the crux, you will use one or more of them. Willpower is not enough.

To do strategy well, avoid the bright, shiny distractions that abound. Don’t spend days on mission statements; don’t start with goals in strategy work. Don’t get too caught up in the ninety-day chase around quarterly earning results.

Importantly, there are multiple pitfalls when executives work in a group, or workshop, to formulate strategy. The Strategy Foundry is a process by which a small group of executives can do challenge-based strategy, discover the crux, and create a set of coherent actions for punching through those issues. It is quite different from strategic planning or other so-called strategy workshops, where the outcome is essentially a long-term budget."

A Strategy Foundry is intended to help senior managers create a more effective strategy for their organization. In general, the senior executive officer must be a participant. During a Strategy Foundry, participants will be guided in diagnosing the situation facing the company, developing broad guiding policies, and creating coherent actions based on proximate objectives. They typically engage up to 10 top managers from a single firm and last 2 to 5 days. By starting with the challenge, the group becomes responsible for designing a response rather than choosing among plans already advanced by members or others, or just filling in the blanks for a longer-term budget.

[Duncan · Rating 1 out of 5]

I must admit I was quite disappointed with this book. Rumelt is a foundational figure in the field of strategic management, primarily due to his in-depth, data-driven study that showed that unrelated diversification is counterproductive, and that related diversification makes more sense.

Unfortunately, in this book, none of that rigorous analysis is present; Rumelt threw all academic, analytical, and wanna-be-scientific rigor to the wind and presents us with the most nebulous of heuristic frameworks for strategic decision-making, supported by a bunch of anecdotes.

The problems with this whole book are almost innumerable, I'll just provide a few samples and impressions:
- The examples and anecdotes Rumelt uses to illustrate his points are all over the place in terms of detail, quality, interpretation, level of analysis, appropriateness, etc. Some of the examples are so generic they are meaningless, others are his own very particular (many times controversial) take on events (coupled with very selective exposition of events), most are not sufficiently well-tailored to the point he is trying to make that they could be interpreted in the opposite direction (but really are just meaningless).
-The tone of writing seems to come from a cranky, old, opinionated man who leans conservative (but probably thinks he is an "independent thinker" who "sees things as they really are" and is able to "cut through the BS"). There are many unnecessary barbs sprinkled throughout criticizing or demeaning other points of view or approaches. He does not need to "problematize" in this way to keep us reading.
- The structure of the book is weird. While the main parts seem to make sense when you read the table of contents, they don't really flow well together. I never really understood his main idea and then why all the subsequent chapters made sense and built on it. This may be partly due to his writing style (I would prefer a clear model at the start and then a discussion around it) but also maybe due the fact that there isn't much "there" there to structure the book around, so he just goes off on a ton of tangents and pet peeves around organizational inertia and corporate "strategy making" (many of which I agree with, but I don't think he resolves them in any way). The most valuable part to me was the final one "The strategy Foundry" in which he describes his method of intervention (or consulting) in firms. After reading that, I better understood why he wrote the rest of the book (even if I don't agree that all of it flows from his methods of trying to do strategy).
- It's interesting to read his take on how to help companies "do" meaningful strategy, and I may use some of his techniques in my life, but I think that he does not want to face up to the fact that his techniques are ultimately pretty useless for the same reason all "strategic consulting" is. There simply is no way that a 2 to 5 day exercise is going to meaningfully change how an organization acts, is structured, etc. The underlying concepts of thinking carefully about the situation and taking appropriate actions have to be performed on a consistent manner for years at a time.
- Ultimately, his core concept (the crux) is very lame and amorphous. He provides a lot of examples, but not a disciplined and rigorous way of approaching a situation in order "get to the crux" and really know that we have identified the true crux. The fact of the matter, is that we can't (and he can't provide one), all cruxes are identified (or confirmed to have been correctly identified) in hindsight. In the moment, it's practically impossible to know if that is the key issue that needs to be solved. Even in hindsight, we also "construct" those cruxes to make a nice narrative and minimize all the other things that occurred that were meaningful for a given outcome to occur.

[VENKATRAMAN C K · Rating 5 out of 5]

I just finished reading the book, "THE CRUX: How leaders become strategists" by Richard Rumelt

Having observed, as well as participated in many strategy exercises, I have seen both successes & failures with myriad of reasons for both outcomes, and see many such equivalents in this book.

The Author comes up with a very useful framework called "Strategy Foundry" - a furnace metaphor for a process of casting a solid set of actions that address critical challenges facing the Organization. He has been practising the framework for many years.

At the very outset he calls out the three big challenges that face a CEO when creating a strategy - Growth Expectations, Corporate internal power challenges and Creation of coherent actions. These, if not addressed, will result in a wishful Goal set with no clear path of achieving them. However, CEOs are pressurised by various stakeholders & misaligned incentives to pursue the trodden path which mostly fails.

The central premise is that Strategy is about identification, selection & resolving of critical challenges that face an Organization. Companies make a classic mistake by starting their strategic exercises with defining long term Goals. Goals, according to him, are an outcome of strategy process. They exist to measure progress against Actions selected to solve critical business challenges.

Thus, the essence of strategy is to first identify core set of issues facing the Organization, which when solved can move the Organization forward. The next step is to choose among these issues and prioritise them. Then pick the few that are both critical (strategic) and addressable (resources, skills available or can be made available) and build Action plans. Thus, CRUX of the process is to identify Addressable Strategic Challenges (ASCs) & build and commit to Action plans. He calls this three steps - Collect, Cluster & Filter.

Strategy is problem solving and consists of creation of Policies & Actions to address ASCs. The book describes various aspects of how to do this - both the Dos and Watch-outs. Plenty of examples are covered from US and Europe & also across industries.

Each item, in the list below, is a chapter by itself with case studies to drive home the point.

Dos:

- Problem diagnosis ( Use of Framing, Analogies , Use of Comparison & Frameworks)
- Seek an Edge
- Innovating
- Address Organization Dysfunction

Watch-outs:

- Don't Start with Goals
- Don't confuse Strategy with Management
- Don't confuse current (read Quarterly) Financial Results with Strategy
- Use sharp analytical tools with care
- Use Strategic Planning (long range) with care (Hits & Misses, Uses & Misuses)

Process:

- Foundry Walkthrough
- Strategy Foundry Concepts & Tools.

A highly provocative book. He demolishes lots of conventional wisdom !!

A must read for all Leaders !!.

[Raffaello Palandri · Rating 5 out of 5]

Book of the Day – The Crux: How Leaders Become Strategists

Today’s book of the day is THE CRUX: HOW LEADERS BECOME STRATEGISTS, written by Richard P. Rumelt in 2022 and published by PublicAffairs.

Richard P. Rumelt is an internationally known writer, speaker, and consultant on strategy. He is also Emeritus Professor at UCLA Anderson. He received his MSEE from UC Berkeley and his doctorate in business from Harvard Business School.

I have chosen this book because lately I have been involved in positive discussions about what can be defined as a business strategy.

When I thought about who I consider being among the best expert in strategy, I immediately remembered that Richard Rumelt had written a book last year.

One of the core ideas of this book is that we need to cancel theory in what we use when we are doing strategy.

Rumelt is quite clear in showing that in many businesses, governments, and also in military ops strategy is just a useless series of unrealistic ideas and incoherent practices, driven by a mistaken sense of understanding about the topic, often just imposed from the top.

The breakthrough concept of this book is that a manager, a leader can become more effective in designing strategies by concentrating on overcoming the challenges rather than thinking about hypothetic goals.

The innovation here lies in the ability a leader should have or develop to become aware of, and then work on the most important points of the challenges the business faces. Once these key points have been pinpointed by the strategist leader, then the next step is taking effective, coherent, and decisive decisions that will achieve the result of creating the greatest and most important results.

If you ask how one can find the point to be addressed by strategy, Rumelt suggests a practical method:

1. list all the (actual and potential) problems you face
2. give them a value on a scale from 1 to 10 on how critical they are
3. give them another value on a scale from 1 to 10 on how addressable they are.
4. map the results and choose the issue whose values’ sum is highest.

The absolute winning point of this book is showing that strategy is not about magic or vision. It’s about being at the same time extremely practical and extremely creative in addressing those issues that, once solved, lead us to the greatest progress and growth.

I definitely recommend reading this book if you work in a job that ever requires you to take key decisions or if you want to learn about strategy from one of the best experts in the world.

[Steven Leonard]

I have kept a copy of Richard Rumelt’s book, 𝘎𝘰𝘰𝘥 𝘚𝘵𝘳𝘢𝘵𝘦𝘨𝘺/𝘉𝘢𝘥 𝘚𝘵𝘳𝘢𝘵𝘦𝘨𝘺, on my bookshelf at work since I first read it a few years ago. It's a great book, a solid read, and something that sparked memories of days (and sometimes nights) spent solving the world's problems from the inside the bowels of a undisclosed location somewhere (also known as a SCIF).

𝘛𝘩𝘦 𝘊𝘳𝘶𝘹: 𝘏𝘰𝘸 𝘓𝘦𝘢𝘥𝘦𝘳𝘴 𝘉𝘦𝘤𝘰𝘮𝘦 𝘚𝘵𝘳𝘢𝘵𝘦𝘨𝘪𝘴𝘵𝘴 is a compelling follow-up to 𝘎𝘰𝘰𝘥 𝘚𝘵𝘳𝘢𝘵𝘦𝘨𝘺/𝘉𝘢𝘥 𝘚𝘵𝘳𝘢𝘵𝘦𝘨𝘺, rekindling Rumelt's consistently pragmatic approach to strategic thinking. Drawing on decades of experience and vivid case studies—from SpaceX innovations to Netflix’s rise—he reframes strategy not as lofty goal-setting, but as the art of identifying and solving the most critical, solvable challenge: the crux.

Rumelt defines the crux as “the one challenge that both is critical and appears to be solvable.” Strategy begins not with vision statements or financial targets, but with pinpointing this challenge and concentrating effort there. Fun fact: this is why framing is such a critical part of strategy - the effort you invest there will spare you headaches later on.

The book revolves around three key themes and one critical takeaway that reinforce the concept of the crux:
𝗣𝗿𝗼𝗯𝗹𝗲𝗺-𝗦𝗼𝗹𝘃𝗶𝗻𝗴 𝗼𝘃𝗲𝗿 𝗚𝗼𝗮𝗹-𝗦𝗲𝘁𝘁𝗶𝗻𝗴: Strategy is portrayed as a form of problem-solving, requiring diagnosis, insight, and coherent action—not a laundry list of ambitions. Aspirations are good, but they're not strategy.
𝗙𝗼𝗰𝘂𝘀 𝗮𝗻𝗱 𝗟𝗲𝘃𝗲𝗿𝗮𝗴𝗲: Effective strategy demands focus. Trying to tackle too many priorities dilutes impact and breeds internal conflict.
𝗛𝗼𝗻𝗲𝘀𝘁𝘆 𝗮𝗻𝗱 𝗜𝗻𝘁𝗲𝗴𝗿𝗶𝘁𝘆: The quality of strategy work is directly tied to the integrity of the system. Without it, even the best frameworks falter. In other words, be honest with yourself about the outputs.
𝗖𝗿𝗶𝘁𝗶𝗰𝗮𝗹 𝗧𝗮𝗸𝗲𝗮𝘄𝗮𝘆: Rumelt rejects the idea of strategy as a static, long-term vision. Strategy is a dynamic process—one that evolves as the crux shifts. This challenges leaders to stay agile, resist the allure of generic goals, and instead concentrate force on what truly matters. As he puts it, “Start with your challenges, not your goals”.

But this wouldn't be a complete rundown without one good quote: “You cannot get up with just strength and ambition. You have to solve the puzzle of the crux and have the courage to make delicate moves almost two stories above the ground.”

[Timon Ruban · Rating 2 out of 5]

Finishing my trifecta of strategy books this month.

Understanding Michael Porter: The Essential Guide to Competition and Strategy and 7 Powers: The Foundations of Business Strategy equip you with sound theory and a framework to answer the question: "is this a good strategy?". But where do you even start, if you don't have a strategy? How do you come up with a good one?

Here, the Crux (a book that essentially is an extension of Rumelt's previous Good Strategy Bad Strategy: The Difference and Why It Matters) provides good guidance.

It boils down to this: the intuitive "well, let's start by putting down our goals, because if we don't know where we're going, how will we ever figure out how to get there" is dead wrong. Goals tend to be either too lofty ("let's double our revenue", "let's increase our profit margin") or too specific ("let's successfully enter market Y"). The lofty goals are in no way helpful in figuring out what to do and the specific goals are just "decisions in disguise" minus any explicit analysis to back them up. "Ambitions, desires, and values do not tell us what to do." Good goals are the outputs of strategic thinking not the inputs.

So where do you start looking for strategic ideas? With your on-the-ground challenges. The crux of any strategy is finding and focusing on the next most important challenge that you believe you can solve through coherent action.

There are a few pages in the book that explain this in an eloquent and memorable manner. The rest is a long, long list of reminiscing anecdotes collected by a man near the end of his career. I got very little value out of those.

[Daniel · Rating 5 out of 5]

The Crux: How Leaders Become Strategists - Richard Rumelt

⭐ 9/10 — Highly recommended

This book is about one thing: solving the hardest problem first.

Richard Rumelt calls it the crux, the key challenge that, if solved, makes everything else easier.

He compares it to climbing: the crux is the toughest part of the route. Once you get through it, the rest becomes possible.

That idea fits how I lead. In operations and governance, we face dozens of issues every week, but real progress only happens when we find and focus on the one that truly matters.

Rumelt doesn’t write about big visions or fancy goals. He talks about clear thinking, honest diagnosis, and practical focus.

For anyone leading a team or a project, this book is a reminder that strategy isn’t about having many priorities, it’s about having the right one.

🔑 What I Learned

1. Find the Crux, Not the Noise: Focus on the real challenge that defines success.

2. Strategy Is About Solving, Not Planning: You don’t plan your way out of confusion, you solve it.

3. Clarity Needs Courage: Say no to good ideas so you can say yes to the right one.

4. Trade-offs Are Inevitable: You can’t do everything. Choose and commit.

5. Avoid Fluff: Clear words lead to clear action.

6. Stay Close to Reality: Strategy fails when leaders lose touch with what’s really happening on the ground.

7. Keep Moving: Once you solve one crux, another will come. That’s how leadership grows.

For me, The Crux is a reminder that good strategy is simple: see the real problem, face it, and stay focused until it moves.

Strategy begins where difficulty and uncertainty meet.

#LeadershipLegacySeries #Leadership #Strategy #Focus #OperationalClarity #Indonesia

[Eric · Rating 5 out of 5]

Business books are usually either full of fluff i.e. there is a lot of abstract ideas conveyed in noisy, complicated graphs with no apparent purpose, or are extrapolating processes, systems or theories which are highly context-specific and therefore useless in constructing strategy in the present.

Based upon decades of experience as a professor in strategy and as a top-tier consultant Richard Rumelt cuts right through all the noise that is so common in business books. He lays out a theory on strategy that theoretically makes sense, he clarifies it with a plethora of examples, and constructed a practical method of designing strategy. Besides that he provides some useful tools and advice executing it.

Within the field of (business) strategy there is a lot of frameworks, models, and tools of analysis. Although interesting and worthwile in terms of analyzing companies after the fact, there is not much written that actually provides a logical philosophy of what is strategy and how to design one.

As a consequence most firms implicitly define target setting or value conveying or management as being the strategy work needed to further their endeavors. Even more common is the practice of setting financial goals by senior executives and then forwarding these to middle management, which assumes that the only thing that is left to be done is filling in the blanks. The latter approach of induction based strategy creation lacks even theoretical logic. It did not survive the test of time, but unfortunately perseveres in a lot of boardrooms today.

Rumelt develops a theory of challenge-based strategy design (as opposed to induction) that will prove to be invaluable to a large spectrum of organizations. Government, multinational corporations as well as start-ups, will perform vastly better adopting the method.

For me this book is even better in my opinion than his previous one. This one cuts deeper on the “how to design strategy in practice” than does “good strategy/ bad strategy”.

Big thanks to mr Rumelt.

[Kathy Reid · Rating 5 out of 5]

Picking up where left off, Richard P. Rumelt again pens an accessible, illustrative and easily-practiced guide to developing - and enacting - organisational strategy.

At the heart of both Good Strategy Bad Strategy: The Difference and Why It Matters and The Crux: How Leaders Become Strategists is the assertion that strategy is about firstly problem-solving: deeply understanding the environment, the organisation and the challenges it faces, the resources and advantages it has. This introspection yields the titular "crux" - the key problem that the organisation has to solve.

Secondly, strategy is about harnessing the organisation's resources to a singular pursuit of a path that solves that key problem; for Rumelt, diversification of efforts is dilution of strategy.

Recommended both for early-career managers, and for seasoned leaders who are weary of vague and ill-grounded strategy documents that become shelf-ware.

[George Hipp · Rating 4 out of 5]

Good Strategy, Bad Strategy is one of my favorite books on strategy over all. It has many important ideas and I learned a ton. The Crux could be considered a follow up to the original, with some more information around how to create an organization developing good strategy (The Foundry at the end of the book) and many examples of tools and measurements, however, Rumelt's original book is still my favorite. I could have been due to when I read it. There is still some good stuff in The Crux, and it was a good read. One thing I have learned through experience (and reading these sorts of books), is strategy is not an object created in a room with a bunch of extremely senior people and delivered like the 10 commandments, it is selecting and defining the most important and difficult challenges with the broadest impact and creating an understandable, modular plan to meet them. Many times this does not mean solving them, but creating the message and measurements for the organization to understand where to focus and what direction to go. Then it is all in execution and adjustment. These sorts of decisions and activities have huge impacts, but doing something is almost always more important than more planning.

Enjoyed the book and if you start with this one, I still recommend Good Strategy / Bad Strategy!

[Boni Aditya · Rating 4 out of 5]

When I saw that Rumelt wrote another book, I was excited.

The first book is an eye-opener. Good Strategy/Bad Strategy is an epic.

I was just excited to know what more Rumelt has to offer and he does not disappoint.

Rumelt talks about the technique used to find the CRUX, or the bottleneck or the challenge.

The diagnosis is the first step that Rumelt prescribes where the strategist makes a huge list of all the problems, collected from the most difficult challenges from the business.

The Strategist then tries to find the crux or the most critical challenge that needs to be solved to release the knot.

Here is where the best part of the book comes in - THe author talks about what is not a strategy and how people confuse other stuff with strategy.

Shiny distractions - as he calls them shiny distractions that Include - confusing strategy with management, confusing strategy with goals, and vision, confusing financial results with strategy, and confusing metrics with strategy among others....

The last step is the strategy foundry, which actually felt like a space filler rather than a great insight.

I think the last few chapters are not that impressive. But it is about the process or the best practices that the author has used.

[Felipe Velasquez · Rating 4 out of 5]

"The Crux" by Richard Rumelt is a very good book about how to make a good strategy. Many books about strategy just talk about goals, but this book is different. Rumelt says that good strategy is about solving the biggest problem that stops you from doing well. He calls this problem the "crux."

The book says you should not start by thinking about your goals. First, you need to find the "crux"—the most important problem you can solve. This idea is very helpful because it makes you think about what is really stopping you.

Another good idea in the book is "proximate objectives." These are small goals that you can reach quickly. When you reach these small goals, you get closer to solving the "crux." They help you know what to do now and feel good about your progress in the short term.

Rumelt uses real examples to explain his ideas, which makes the book easy to understand. He also talks about common mistakes that make a strategy bad. The book is written in a clear way.

"The Crux" teaches a new and useful way to think about strategy. It helps you find your biggest problem and then make a plan to solve it, step-by-step. This book is very helpful for anyone who wants to make better plans at work or in their own life.