Whether Costas Markides is reaching for a volley on the tennis courts of Regent’s Park, supporting Manchester United or teaching a classroom of students or executives, he is an unashamed enthusiast.

The strategy professor’s classes at London Business School are at turns playful and challenging, voluble volleys of ideas and opinions.

In one exercise students have to work out how many pieces they can cut a cake into with four straight cuts. Predictably, they assume that the cake is round or that the pieces have to be equal. Nobody gets the answer right.

He also asks students to split into pairs and arm wrestle for 30 seconds. The winner is whoever manages to push their opponents’ hand down most times in the allocated time. The obedient high achievers begin arm wrestling and succeed in pushing their colleagues’ arms down a few times at best. But there is always a pair who cooperate and press their arms up and down dozens of times in 30 seconds.

The use of such exercises to drive home a point are a constant in Markides’s classes. He teaches the MBA elective course on strategic innovation, the senior executive programme and a one-week executive course on designing strategy for value creation. In the cake exercise, students learn that we are all prisoners of our assumptions. In the arm-wrestling exercise, the lesson is that being different may be superior to being better.

Markides says: “Most companies try to become better than their competitors. But, for almost all companies other than the established leader, being better is not the right way. Smaller companies need to play a different game.”

Markides’s new book, Game-Changing Strategies, examines the obstacles that established companies face as they seek radical business models and what they can do about them. Part of the problem, Markides suggests, is that we confuse innovation and creativity: “Innovation is about coming up with ideas then finding ways to scale them up to create mass markets.”

The trouble is that while coming up with ideas is celebrated as innovative the act of scaling them up into big markets is not. Large companies are good at “scaling up” the ideas of others. But instead of taking these ideas and converting them into big markets, they focus on coming up with ideas. Unfortunately, small firms excel at this.

But who needs a strategy when survival is the top priority? “Of course, you need a strategy,” he says. “Imagine you are in the jungle. In the dense foliage you cannot see beyond a few feet. Do you need a strategy on how to get out alive? Well, the last thing you want to do is to stay still, paralysed by uncertainty. You need to analyse your position based on the available information then decide on a direction. That is the first principle of strategy – the need to make difficult choices based on the information you have at the time. You take stock, gather information based on that and then start walking. The worst thing is to stay still. That is the second principle of strategy – stop analysing and start doing, even if you are not entirely sure that what you are doing is going to to be the right thing.”

He adds: “After you start walking, new information comes your way. That is the third principle of strategy – learn as you go along and modify your strategy through trial and error.

“Strategy is all about making difficult choices in the face of uncertainty, learning as you go along and adjusting your original choices.”

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