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Foundations of Corporate Success
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Table of Contents

Introduction
Part I: Corporate Success
1: The Structure of Strategy
2: Adding Value
Part II: Business Relationships
Introduction
3: Cooperation and Coordination;
4: Relationships and Contracts
Part III: Distinctive Capabilities
Introduction
5: Architecture
6: Reputation
7: Innovation
8: Strategic Assets
Part IV: From Distinctive Capbilities to Competitive Advantage
Introduction
9: Markets
10: Mergers
11: Sustainability
12: Appropriability
13: The Value of Competitive Advantage
Appendix
Added Value Statements
Part V: Competitive Strategies
Introduction
14: Pricing and Positioning 1
15: Pricing and Positioning 2
16: Advertising and Branding
17: Vertical Relationships
Part VI: The Strategic Audit
Introduction
18: The Industry
19: The Firm
20: The Nation
Part VII: The Future of Strategy
Introduction
21: A Brief History of Business Strategy
22: Conclusions
Glossary
Bibliographic notes

Promotional Information

A lucid analysis of what distinguishes a successful business

About the Author

John Kay is a visiting Professor of Economics at the London School of Economics, a Fellow of St John's College, Oxford. He is a Fellow of the British Academy, a Fellow of the Royal Society of Edinburgh, and a member of the Scottish Government's Council of Economic Advisers. He is a director of several public companies and contributes a weekly column to the Financial Times. He is the author of many books, including The Truth about Markets
(2003) and The Long and the Short of It: finance and investment for normally intelligent people who are not in the industry (2009) and his latest book, Obliquity was published by Profile Books in March 2010.

Reviews

`it is hard to remember a book which has such richness of penetrating (and well-written) comments on such a varied and complex research literature. If you are a business historian with no strategy text on your shelves, buy this one and you will be well served ... you will find within its covers freshness of critical perspective, not arid duplication ... Kay has produced the thinking business historian's strategy text: vital reading'
Business History
`an exceptionally powerful contribution to thinking on business strategy'
Ian Hay Davison, Chairman of Storehouse
'A fresh and insightful approach, blending theory and case studies, to the links between corporate culture, strategy and success.' Sir Geoffrey Owen, former editor of the Financial Times
`One of the book's pleasures is a collection of figures that compare the added value of different firms in the same industry. Another is the fascinating variety of examples and comparisons illustrated in diagrams or pictures ... Foundations of Corporate Success is an important book. It does not offer easy answers but contains much well illustrated advice ... The book is important also because it provides an original analysis of business strategy
and one that is European rather than, as is usual, American. It deserves to be influential.' Rosemary Stewart, Independent
`Kay, succeeds in marrying an authoritative grasp of economic, legal and sociological theory with an impressively detailed knowledge of contemporary business practice ... a powerfully argued book, which casts a fresh light on a range of practical business challenges.'
Guy de Jonquieres, Financial Times
You must read John Kay's new book Foundations of Corporate Success. Kay is currently the best management theorist in Britain, bar none.' Business Age
`impressive and readable volume on corporate strategy ... the scope and quality of this book put it in the same league as Michael Porter's celebrated volumes on competitive strategy and signal a certain coming of age of business education in Britain'
Peter Oppenheimer, Observer
`There is a lot in Kay's book that I agree with.'
Tom Lloyd, Sunday Telegraph
`Foundations of Corporate Success is going to throw a lot of strategic management thinking and teaching into considerable turmoil, as Kay very ably deconstructs in good part the ruling nostrums and approaches to strategic management analysis.

Foundations of Corporate Success represents a signally important and positive contribution by an economist to the contemporary analysis of corporate strategy.

Foundations of Corporate Success is, quite simply, a major tour de force ... Foundations of Corporate Success represents a major restatement and reconfiguration of strategic management analysis ... and, no doubt, will give rise to a considerable furore within the learned journals.'
Economic Affairs
`Students of European business may get their teeth into this book in ways that are not offered by the many acres of American management texts.' Economic Affairs
`A major new book offers a fresh insight into just what makes companies tick ... required reading for everyone making investment decisions ... The new work fills the gap, and it represents Europe's response to Harvard theories on management. What John Kay offers is an analysis that is not just based on US multinationals over the last decade, but deals with strategies for Europe in the 1990s.'
Colin McLean, Scotsman Business Agenda
'...widely hailed as a milestone in its field.'
Economic and Social Research Council Annual Report
`This is an economist's view of corporate strategy, but not a conventional one. Kay's Foundations of Corporate Success is well-written, understandable and makes strong claims for its practical relevance to managerial action ... Thus Kay has stirred up an important debate, which should concern all readers of this journal. He has, moreover, provided a book that will be valued by all those interested in developing economic approaches in
their strategy teaching.'
Richard Whittington, Journal of Management Studies
'Excellent for teaching corporate strategy at final year degree level'
Eric Carter, UCE Business School
`John Kay's ideas represent an innovative approach to developing a discussion on the notion of corporate strategy. It is an essential read for any business/economics under/post graduate. I shall take pleasure in recommending the text to my students.'
Denis Harrington, South Bank University
`Identify your distinctive capability, select your market, then build the strategy - the conclusion of one of the most important "strategic thinking" books in years ... This is a work of considerable scholarship and the product of a formidable intellect ... As to which market is best suited to this book's own distinctive capabilities, it is without doubt the MBA student. I can think of no better way of preparing for an examination in business
strategy.'
Philip Sadler, The Director
`Excellent for teaching corporate strategy at final year degree level.'
Eric Carter, UCE Business School
`John Kay's Foundations of Corporate Success is refreshingly inconoclastic. Taking the axe to fashionable theories about corporate strategy, Kay likens many of the nostrums peddled by business gurus to quack medicine ... the book is thought-provoking and thoroughly documented.'
Financial Times
`Book is very good quality, and I will recommend it.'
Paul Broholm, Rotterdam School of Management
`An excellent and very readable account of the state of thinking in strategic management from a primarily economic perspective.'
N.R. Pandit, Manchester Business School
`Very useful, will no doubt be required reading in many courses dealing with strategic management.'
Lars Christian Smith, Sacred Heart University
`An excellent book. I am using it to encourage students to see strategy implications within the field of Organizational Behaviour.'
Romy Jenkins, City University Business School
`Deserves to be widely read by top management.'
Long Range Planning
`Excellent book - the success/failure insights help to reinforce concepts developed in the book.'
George Burt, University of Strathclyde
`In this challenging and authoritative book, John Kay, Professor of Economics at London Business School, vigorously tackles the questions of what are the origins of corporate success and how it should be measured ... Kay's iconoclastic approach to the well-established theories of corporate strategy is backed by scholarship and lucid argument ... This stimulating text casts a penetrating and knowledgeable eye over theories of corporate strategy.'
Journal of the Market Research Society
'The publishers claim, right I think, that the book is probably the most important contribution to European strategic thinking for many years.'
John Coleman, New European
'Deserves to be widely read by top management.'
Long Range Planning
`Any review must begin by applauding the verve and proficiency with which this eclecticism has been performed ... this is by no means a work of pure analysis. It is also an exercise in iconoclasm ... stimulating and lucidly argued book which is sure to grace management bookshelves for many years to come.'
Long Range Planning
`Good, update book of modern business strategy.'
Kaare Sandvik, Buskerud College
`This is a well written book, which covers most of the aspects in corporate strategies.'
Chris Simango, Business and Management School, Regent's Park. London
`it is hard to remember a book which has such richness of penetrating (and well-written) comments on such a varied and complex research literature. If you are a business historian with no strategy text on your shelves, buy this one and you will be well served ... you will find within its covers freshness of critical perspective, not arid duplication ... Kay has produced the thinking business historian's strategy text: vital reading'
Business History
`A lot of fresh thinking is coming from less familiar people, ranging from academics such as John Kay and Sumantra Ghsoshal (both at the London Business School) to manager pundits such as Percy Barnevik.'
The Economist
`Mr Kay is well on the way to turning himself into a European Michael Porter, Harvard's top showman.'
The Economist
'This is a splendid book. Kay shows his colours. He dissociates himself from the American obsession with advantages of scale and its attendant zeal for buying businesses and amalgamating them. He speaks in favour of stable, less destructive competitive relationships. This is a highly sound piece of work. It is thoroughly researched. The theoretical foundation is impressive. The case studies are strongly developed, the examples well chosen. On the jacket it
says: 'This book is probably the most important European contribution to strategic thinking for many years.' Only the word probably is to my mind superfluous. It could safely be changed to 'certainly' ...
this is in every way a giant intellectual feat.'
Prof Dr Marc Buelen, De Financieel-Ekonomische Tijd
'cet ouvrage est de qualité ... Treize ans aprés la parution de The mind of the strategist (K. Ohmae), J. Kay donne une version des raisons du succès des entreprises excellentes. L'analyse économique moderne collabore utilement avec les disciplines de gestion.'
Alain Bienaymé, Analyses de la S.É.D.É.I.S., No. 104, Mars 1995
`For a long time, I and other colleagues have looked for a book on business strategy which we could recommend unreservedly to MBA and final year undergraduate students. In Kay's book we have found one.'
Books for MBAs
`It is an intelligently written book, worth writing. In paperback it has the potential to reach a wider audience ... it does make a contribution to entrepreneurship practice and theory ... It is very comprehensive in its application of current theory and many extremely intelligent points are made.'
International Small Business Journal
`It approaches its subject in a way which is characteristic of the economist: That is to say, in a rigorous, analytical fashion, and thus in a style which sets it apart from that often preferred by practitioners in business or academics working within other disciplines ... The argument that there exist concepts and models which provide valuable insights into the sources of business success and that it would be almost perverse not to use them, is very
persuasive and ... Kay presents it well.'
The Economic Journal
`It approaches its subject in a way which is characteristic of the economist: that is to say, in a rigorous, analytical fashion, and thus in a style which sets it apart from that often preferred by practitioners in business or academics working within other disciplines ... the argument that there exist concepts and models which provide valuable insights into the sources of business success and that it would be almost perverse not to use them, is very
persuasive, and ... Kay presents it very well.'
Economic Journal
`Kay covers most aspects of business strategy including mergers and acquisitions, pricing and positioning of products, and advertising and marketing. If you are considering taking an MBA programme then this book will provide you with an insight to the core subject of strategy.'
Management; The British Journal of Administrative Management

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