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The Core of Success: Unraveling the Kernel of Good Strategy

In the intricate dance of strategy, Richard Rumelt unveils the 'kernel' as a blend of thoughtful deliberation and decisive action, underpinned by a triad structure. This triumvirate comprises: 1) A discerning diagnosis, 2) a visionary guiding policy, and 3) a tapestry of coherent actions.



Consider the power of a robust "guiding policy." Take George Kennan, an American diplomat in the USSR, whose observations of Soviet conduct birthed the 'long telegram'. Kennan's analysis painted the Soviet Union as a foe to capitalism, a virus to be contained. His perspective was a pivotal moment, shaping decades of foreign policy. Had the diagnosis been different, say, a path of engagement rather than containment, history might have witnessed an alternate narrative, sparing the world events like the Vietnam War and the Berlin Airlift. Yet, Kennan's vision, while insightful, lacked tangible steps, leaving a gap in translating policy into action.


A guiding policy, when crafted astutely, can morph into a strategic advantage. It simplifies complexity, leverages opportunities, and aligns actions into a coherent force.

Enter Nvidia, the 3D-graphics juggernaut under Jen-Hsun Huang. From its inception, Nvidia's shares soared, outperforming giants like Apple. Their strategy?


Diagnosis: Identifying 3D-graphics chips as the keystone of future computing, driven by the insatiable appetite of PC gaming.

Guiding Policy: Transitioning from a broad multimedia focus to honing in on superior graphics for PCs via cutting-edge GPUs.

Action Plan: Implementing a three-pronged approach; 1) Creating three specialized development teams, 2) Investing in design simulation to preempt production hiccups, 3) Introducing a Unified Driver Architecture, ensuring seamless driver software compatibility across Nvidia chips, smoothing the journey for both the company and its clientele.


Nvidia's annual growth rate hit an impressive 67% from 2001 to 2007. Unlike Intel, which experienced similar growth but was hampered by production issues, Nvidia captivated the market with regular, top-notch GPU releases.

In a landscape where rivals like Silicon Graphics overextended, Nvidia's strategy was a masterclass in focus, intuition, and flawless execution.

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