In sum, there were three critical where-to-play choices for P&G at the corporate level:

• Grow in and from the core businesses, focusing on core consumer segments, channels, customers, geographies, brands, and product technologies.

• Extend leadership in laundry and home care, and build to market leadership in the more demographically advantaged and structurally attractive beauty and personal- care categories.

• Expand to leadership in demographically advantaged emerging markets, prioritizing markets by their strategic importance to P&G.

It is tempting to believe that strategy in general, and where-to-play and how-to-win choices in particular, are needed only for outward-facing functions—those folks who interact with external consumers and competitors. But every line of business and function

should have a strategy—one that aligns with the strategy of the company overall and decides where to play and how to win specifically for its context. At P&G, corporate functions are all tasked with crafting their own strategies in this way. Joan Lewis, global consumer market knowledge officer, explains: “Where to play and how to win has been a very important framework for us. Organizations are often good at one or the other without realizing that they’re two different sets of decisions. At one point, we weren’t as disciplined about our where-to-play choices. It was everywhere anybody needed consumer insight or anywhere we thought it could add value. Just like a business dilutes its focus and in turn its growth potential when you try to do too many things at a time or do things that are further away from your core strengths, we were relatively diluted in the nature of the impact we could have.

So we worked up a new process to begin in the fall of 2001. It was a radical change for all involved. Previously, a president would come into a review meeting with a lengthy PowerPoint presentation, which captured all the material that he or she wanted to share. The president would go through the deck, slide by slide, revealing the material to the mass audience in real time. We changed the meeting completely. It went from a formal presentation (by the business to management) to a dialogue focused on a very few critical strategic issues identified in advance. Whatever strategic issues the president wanted to discuss were delivered in writing in advance of the strategy review meeting. The senior team would review the submission and select the issues it wished to discuss (or propose alternative points of discussion).

The change created a good deal of angst at first. Slowly but surely, though, the review meeting became what we hoped it would be: an inquiry into the competitiveness, effectiveness, and robustness of a strategy. In due course, the presidents came to understand that they wouldn’t be judged on whether they had every aspect of their strategy buttoned up but rather on whether they could engage in a productive conversation about the real strategic issues in their business. As a result, P&G leaders began to do more strategic thinking, to have more strategic conversations—not just at strategy reviews, but in the normal course of business—and the quality of strategic discourse improved. More importantly, the company saw better choice making, more willingness to make hard calls, and eventually better business results.

The goal was to create a culture of inquiry that would surface productive tensions to inform smarter choices. The explicit goal was to create strategists at all levels of the organization. Over the course of a career, P&G leaders gain practice designing strategy for brands and products lines, categories, channels, customer relationships, countries and regions, and functions and technologies. The idea is to build up strategy muscles over time, in different contexts, so that as managers rise in the organization, they are well prepared for the next strategic task.