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With profits sagging from recessionary conditions, Kimberly-Clarke launches a sneak attack on the working mothers of America. It indirectly raised diaper prices for its huggies brand by reducing the number in a package.

Procter and Gamble immediately responded to this stealth price hike with a "shock & awe" advertising and marketing blitz aimed at exporting the smaller huggies packs and urging customers to compare them with P&G's cheaper pampers. As a key part of this strategy, P&G cut its own prices to further accentuate Kimberly-Clarke's price hike. It also included special displays in retail outlets and the awarding of some "in-your-face" discount coupon for pampers to anyone who bought a box of huggies.

Eventually, Kimberly-Clarke's CEO, had to cry "Uncle". He rescinded the price hike, but not before P&G had grabbed valuable share.

Porter's analysis on corporate strategy is a typical proactive thinking example. But unfortunately adopters frequently segregate his conceptual frameworks and each of frameworks is used as an independent and static frame. Further, his scenario analysis, the most powerful tool of his analysis for Proactive Thinking, is not popular, though other frameworks such as the five-force model; the generic strategy matrix and the value chain are famous and are frequently adopted for corporate strategy formulation, which should be proactive.

For a variety of reasons, many companies have underdeveloped strategies. Sometimes an underdeveloped strategy is effective; a single spectacular idea can carry a business a long way, even without an explicitly stated strategy. Management intuition and organizational willpower can substitute temporarily as well. However, with the pace of business today, industry leaders need to think through and plan for the next industry lifecycle or risk being dethroned. It is possible in today's environment to fully engineer a company from a strategic point of view in a way that was unthinkable five years ago.

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* Contributed by: -
N. Suman,
MBA First Year,
Vinod Gupta School of Management,
IIT Kharagpur.