John Kay

Good strategy begins with diagnosis. And diagnosis is analysis, not a description of symptoms. You don’t go to your doctor to be told you have a sore throat.

In the dollar bill auction, one party eventually scores a pyrrhic victory and takes possession of the dollar bill. Both parties lose, but the smaller loser is the person who sticks out longest. That is not usually the rational player.

When an industry model is broken, the best business strategy may be to manage its decline.

Today’s managers are victims of the tyranny of the quarterly earnings report. And that is why yesterday’s cost-savings are so often today’s corporate crisis.

Most people dislike confrontation, and, given time, an aggressive minority will find itself alienated. Meet the reasonable demands, and appear to treat the unreasonable ones with seriousness; always engage in discussion, however futile.

Tailgaters think the view that their behaviour is dumb is based on a purely theoretical analysis, which is refuted by the tailgater’s practical experience. And so the culture of self-confident, self-congratulatory tailgaters perpetuates itself.

All our experience of the development of information technology starts from what the customer might want rather than what the technology might do.

Maintain a clear sense of long-term objectives but acknowledge the limits on your day-to-day actions.

Three simple rules – pay less, diversify more, and be contrarian – will serve almost everyone well who invests.

Think probabilities and be detached. It’s hard advice to follow. That is why the financial services industry is better off than its customers.