7 Powers: The Foundations of Business Strategy

Reviews

1. 

   David J. Rosenthal – August 11, 2024

   One of the very best business books I’ve read in my career
   I work as a venture capitalist in Silicon Valley, and first heard about this hidden gem of a book from a fellow VC. Having now read it, I can say it is more than just a gem – this is one of the very best business and strategy books written in the past 30 years, up there with Innovator’s Dilemma, Lean Startup and Good to Great. As you can see from the photo, I’ve covered nearly every page in notes and highlights. In reading it, I found Hamilton providing both:1) Incisive theoretical frameworks for dynamics that I’d observed intuitively in my work as an investor and board member for startup companies but couldn’t quite put my finger on explaining. E.g., that individual company leaders are not sources of sustained competitive advantage (“cornered resources” in Hamilton’s terms) because their services can be bought and sold and thus their value is arbitraged by the market. (Note this applies even to company founders – “superstar” teams will typically raise capital at much higher prices than “unknowns”. Very often the price paid by investors for this talent does not adequately compensate for the market risk still faced by the fledgling company.)and 2) whole new ways of thinking about the relationship between market opportunities (what most startups and VCs blindly chase), and the potential for sustainable, differentiated value to be built by a single firm within that market opportunity (Hamilton’s concept of “Power”). I can’t wait to apply these lessons to my own career going forward, and will be recommending Hamilton’s ideas to all companies and entrepreneurs I work with from now on!

2. 

   Anu – August 11, 2024

   Solid read on fundamentals of business strategy
   Hamilton Helmer has created a thoughtful and accessible framework in 7 Powers. The book lays out the fundamentals of business strategy and examines the root source of strategic power for any company. Each power is explained through engaging and fun tech stories. The framework provided the leadership team at my company with a common vocabulary for our strategic discussions. It was useful to evaluate our business against each of the 7 powers listed.My favourite part of the book was the case studies – fun tech stories for anyone that loves tech history. There’s rigorous supporting computations for each power, which might feel academic to the more practical reader, but the book is valuable even if you choose to skip that section. Reed Hastings opens with a great intro on how this business strategy framework was used at Netflix. Overall, great read!

3. 

   Seth W – August 11, 2024

   Very dense read, but the chart and summary shows the insight of the premise.
   Unless you took advanced math, don’t bother reading the sections with formulas, there is not much of an attempt to meet the reader where they are. That said, there are strong insights here. Overall, glad to have read it, not however the thing that I will use every day.

4. 

   Bob K – August 11, 2024

   Insightful and pragmatic
   7 Powers provides an insightful and pragmatic way to understand the basics of business strategy. Far too many approaches that have been hyped are too academic to be easily understood and many others are too simplistic to be useful. This book is very helpful in describing both a static and dynamic view of what power is and how to develop positions of ongoing competitive advantage. Having a shared framework and a way to talk about strategy among the senior team in a company is essential. Many companies struggle on an ongoing basis because they fail to agree on what their source of power is and never develop a consistent and effective strategic gameplan.I found this book easy to read and the case studies and examples both interesting and on point. Highly recommended.

5. 

   Cesar – August 11, 2024

   The book explores the true value drivers that enable any company to differentiate and return real value in a clear way with well known examples from leading companies.

6. 

   Achal Kagwad – August 11, 2024

   [book:7 Powers: The Foundations of Business Strategy|32816087]Focusses more on how companies build moats/defensibility in their models. It describes with case studies 7 ways(7 Powers) how companies try to ensure they remain winners in their chosen area of competence. Read this book after the reading Michael Porter as Porter offers building blocks in competitive strategy and this book extends it.The book at the end explains the concept of “Power Progression” with these 7 Powers which is intuitive to know and have the framework cemented as a layer in your mental model.In Brief the 7 Powers listed are:1. Cornered Resource2. Counter Positioning3. Economies of Scale4. Network Effects5. Switching Costs6. Branding7. OE-Operational Efficiency-Process PowerMust read book for Product Managers, Product Marketing Managers, Key Account Managers, Business Owners and Entrepreneurs.

7. 

   Mallika – August 11, 2024

   I read 7 Powers right through in one sitting. I’ve compartmentalised Silicon Valley go-go-go culture in one area of my brain, and value investors watching paint dry in another areas. This book is the first one that reconciled the two in my head. Strategy/ power/ moat/ barriers are all subtly different and if you’re interested in long term cash flows, I encourage you to dive into this book and incorporate these differences into your investing mental models.This book will be good for value investors, tech startup founders and corporate execs. That’s a rare trio to serve in one book.I found the “counterpositioning” power the most compelling in terms of new thinking. The example given is Vanguard vs asset managers. Previously I’d seen asset managers as choosing to charge active management fees, the counterpostioning chapter made me realise they had no choice.While tech founders might find a quick read useful, I would encourage professional investors to read it closely and learn the framework Hamilton Helmer has outlined.The charts and “math” are very useful as you go deeper into the concepts, but you can easily gain much by sticking to just the text.

8. 

   Karla Zárate – August 11, 2024

   Entrega a tiempo del libro a pesar de ser envió internacional. El libro es muy interesante para poder planear a futuro en una empresa.