The Discipline of Market Leaders

The Discipline of Market Leaders-Michael Treacy and Fred Wiersema

This book, published in 1995 is a management classic and is a must read for the C-suite of any company wanting to develop end to end alignment of strategy, compensation and operating processes. Vertical and horizontal alignment is a core of element of what causes Employee Engagement and is therefore a critical discussion to have in any company wishing to leverage their human resources for strategic advantage.


The authors of this book offer a compelling discussion of the three dimensions upon which companies can establish a clear competitive stance in the market place. Those three dimensions are:

1. Customer Intimacy
2. Operational Effectiveness
3. Product Excellence

The thesis put forward is that companies need to decide what discipline they will adopt in their company to establish a clear competitive advantage over their competitors on that dimension. They go on further to advise us that you cannot ignore the other two disciplines and that you are required to perform on those two dimensions at a level of the acceptable industry standard in order to leverage your chosen discipline for competitive advantage. Further, they give ample examples of companies competing for the same market that have chosen a different discipline to establish their competitive advantage. A great example given is Toys R Us competing on the discipline of product excellence while WalMart competes for the same toy customer with their core discipline of operational effectiveness.

For the CEO and his or her strategic team, this book is full of practical advice and examples of how the key to making this work is the alignment of all the corporation’s resources and operations with the chosen discipline. This book along with Tom Porter’s excellent article from the Harvard Business Review titled “Operational Effectiveness is Not Strategy” will inspire strategic thinkers to look across their organization for alignment in all their activities to send a consistent message to their customers, suppliers and most importantly their employees. Great examples in the article of SouthWest Airlines and other well known companies make the lessons learned real easy to learn and apply to your own strategic thinking.

For the Human Resource professional, this book will give you practical advice on how compensation plans and human resource policies have to adapt to lend value to the discipline chosen.

The Discipline of Market Leaders

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