our work

approach: the delta model

• Our 2009-10 On Campus Recruiting Schedule

The Delta Model is a framework for developing competitively-based corporate and business level strategies that was jointly developed by Dean Wilde and MIT/Sloan Professor of Strategy Arnoldo Hax, along with other members of our firm. The Model stems from both Dean's consulting work as well as input from the Delta Group - an informal set of very experienced senior managers who recognize that the conventional business strategy frameworks are insufficient to make money in today's markets. The Delta Model contains an integrated view of (1) the basic business "models" for achieving profitability, (2) the requirements for linking strategy and execution, both in the short and longer term, and (3) the approaches in execution necessary to implement and adapt successful strategies. It revolves around the concept of bonding and contains four central themes:

The best product doesn't always win:
Three distinct positions can all lead to outperforming your industry over the long term:

• Best product - Low cost or differentiation
• Total customer solution - Reducing customer costs or increasing their profits
• System lock-in - Complementor lock-in, competitor lock-out, or proprietary standard

The System Lock-In and Total Customer Solutions options offer new ways to compete that deviate substantially from conventional strategic positioning.

Execution is not the problem; linking it to strategy is:
Most companies implicitly execute as if they were pursuing a Best Product commodity strategy. No degree of competent execution can save them from this never-ending treadmill. The core processes of the company need to be aligned to the chosen strategy in order to make progress against their strategic agenda and avoid a commodity-like outcome. The Delta Model identifies the core processes of the business and provides a guide for how they need to function differently to achieve different strategic positions.

Managing by averages leads to below average performance:
The popular wisdom today is that the success of a business can be managed by focusing on several key top-line variables. While these averages are helpful, our research has shown that the true performance drivers can only be identified by de-averaged granular metrics. The challenge then is to isolate these detailed metrics, measure the concentrations of cost, revenue and profitability, and learn how to harness these underlying performance factors to improve the profitability of the enterprise as a whole.

Plans are not made to be followed:
Success in today's ever-changing world comes not from creating one perfect plan but rather from adapting as the environment changes. This requires incorporating feedback mechanisms and structured experimentation into your processes and improving through a structured process of segmentation, testing, learning and execution.