Quotes from Michael E. Porter

Although external changes can be the problem, the greater threat to strategy often comes from within. A sound strategy is undermined by a misguided view of competition, by organizational failures, and, especially, by the desire to grow. Managers

Good quality is less costly because of more accurate diagnoses, fewer treatment errors, lower complication rates, faster recovery, less invasive treatment, and the minimization of the need for treatment. More broadly, better health is less expensive than illness.

Competitive forces = the underlying drivers of profitability P.25

High rivalry limits the profitability of an industry P.32

The challenge of developing or reestablishing a clear strategy is often primarily an organizational one and depends on leadership. With so many forces at work against making choices and tradeoffs in organizations, a clear intellectual framework to guide strategy is a necessary counterweight. Moreover, strong leaders willing to make choices are essential. In

Managers at lower levels lack the perspective and the confidence to maintain a strategy. There will be constant pressures to compromise, relax trade-offs, and emulate rivals. One of the leader's jobs is to teach others in the organization about strategy—and to say no. Strategy

Programs in operational effectiveness produce reassuring progress, although superior profitability may remain elusive. Business publications and consultants flood the market with information about what other companies are doing, reinforcing the best-practice mentality. Caught up in the race for operational effectiveness, many managers simply do not understand the need to have a strategy. Companies

Good industry analysis looks rigorously at the structural underpinnings of profitability P.29

Some managers mistake "customer focus" to mean they must serve all customer needs or respond to every request from distribution channels.

Managers must clearly distinguish operational effectiveness from strategy.

One of the essential tasks in industry analysis is to distinguish temporary or cyclical changes from structural changes. P.29

MOST COMPANIES OWE THEIR INITIAL success to a unique strategic position involving clear trade-offs. Activities once were aligned with that position.

The point of industry analysis is not to declare the industry attractive or unattractive but to understand the underpinnings of competition and the root causes of profitability. P.29

Strategy becomes the particular array of activities aligned to deliver a particular mix of value to a chosen array of customers.

Good industry analysis does not just list pluses and minuses but sees an industry in overall, systemic terms. P.29

Approaches to differentiating can take many forms: design or brand image, technology, features, customer service, dealer network, or other dimensions.

When providers have to compete on results, the problem of supply-driven demand, in which available capacity leads to care with questionable benefits, will largely disappear.

Strategy can be viewed as building defenses against the competitive forces or finding a position in the industry where the forces are weakest. P.35

El valor es la capacidad de satisfacer o rebasar las necesidades de los clientes, y también de hacerlo eficientemente.

Without an industry leader, practices desirable for the industry as a whole go unenforced. P.32

From a strategic perspective, however, the issues in health care can be divided into three broad areas. The first is the cost of and access to health insurance. The second is standards for coverage, or the types of care that should be covered by insurance versus being the responsibility of the individual. The third is the structure of health care delivery itself.

The fundamental problem in the U.S. health care system is that the structure of health care delivery is broken. This is what all the data about rising costs and alarming quality are telling us. And the structure of health care delivery is broken because competition is broken. All of the well-intended reform movements have failed because they did not address the underlying nature of competition.

quality differentials have a tendency to erode as an industry matures

The only way to truly reform health care is to reform the nature of competition itself.