Good Strategy/Bad Strategy: The difference and why it matters

by Richard P. Rumelt

It was 1890, and there was a cocktail party here in Pittsburgh. All the movers and shakers were there, including Carnegie. He held court in a corner of the room, smoking a cigar. He was introduced to Frederick Taylor, the man who was becoming famous as an expert on organizing work. “Young man,” said Carnegie, squinting dubiously at the consultant, “if you can tell me something about management that is worth hearing, I will send you a check for ten thousand dollars.” Now, ten thousand dollars was a great deal of money in 1890. Conversation stopped as the people nearby turned to hear what Taylor would say. “Mr. Carnegie,” Taylor said, “I would advise you to make a list of the ten most important things you can do. And then, start doing number one.” And, the story goes, a week later Taylor received a check for ten thousand dollars.