11 — The clever general looks to the effect of combined energy of the team than individuals — Sun Tzu
The clever combatant looks to the effect of combined energy and does not require too much from individuals. Hence his ability to pick out the right men and utilize combined energy. An army needs Wise men(Who could understand merits, devise strategies), coveted men(Who could seize advantages), Brave men(Courageous), Hasty men(Who is not afraid of death).
Similarly, a business needs right men at right places. It is easier to motivate and manage right people when they are at right places. In 1983, Wells Fargo’s CEO Dick Cooley had built a strong management team over a decade. He hired outstanding people wherever, whenever he could find them. In the 1980s, nobody could predict changes in the banking industry. Yet when changes came, Wells Fargo team handled them better than anybody else and outperformed their next competitor by three times. A business needs a balanced team — Visionary, Creative, Strategizer, Researcher, Challenger, Executor.
12 — Know your enemy, know yourself well, you could win the war -Sun Tzu
If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle. You need to compare the opposing army with your own, so that you may know where strength is superabundant and where it is deficient.
Understand your competitor’s strengths, core capabilities, key resources, key partners, distribution channels, research capabilities, vendor associations, customer relationships, possible vendor associations, financial capabilities, sales network.
The sustainable competitive strategy of a business depends on deliberately choosing a different set of activities that are different from your competitor in order to deliver a unique value proposition to your customer.
Southwest airline is a low-cost carrier but the differentiation lies in its activities which are different from competitors. The airline has tailored all its activities to meet the goal of low-cost and convenience for the customer. Fast turnarounds at the gate, no interline baggage checking, no meals, no seat assignments, no premium class, automated ticketing, no travel agents, short-haul flights(avoid flying long distances), provide frequent departures, avoids large and busy airports, — Every activity is aimed at increasing efficiency, keep planes flying longer hours than rivals, serve more people.
13 — The general who sees the obvious wins the battle with difficulty. He who looks below the surface wins with ease — Sun Tzu
To be successful in business, you need to understand your customers in depth. Observe them.You need to empathise with them. Immerse fully in their lives to understand their feelings, behaviour, emotions, needs, desires. Dive deep into your consumer’s mind. Understand the unarticulated needs, desires, emotions which would not be visible to the naked eye.
Till Steve jobs introduced iPhone, nobody knew they needed a smartphone.
P&G did not aim to design a powerful house floor cleaner or wonderful cleaning agent. They aimed to reinvent cleaning experience — desired to reduce efforts and time of consumer in cleaning their home — The SWIFFER was born.
14 — You need a strategy to win the battle, cannot win just with the brute strength alone — Sun Tzu
You cannot build a great business by just on the basis of numbers or volume or on the basis of spending huge amounts of money alone.
On July 28, 1999, a 9-month-old company DRUGSTORES.COM with 500 employees, went public. The company saw its shares multiply three-fold within seconds of opening and its market valuation grew to $3.5billion. Everyone believed that technology would change everything, the internet would revolutionise the business. Just being there first and reaching more customers fast would bring the riches. Unfortunately, in few months, Drugstore.com valuation dropped to about $160 million. It became evident that the millions of dollars that had been spent on advertising and marketing did not pay off.
The Boo.com, fashion apparel e-commerce company, founded in ’98, started selling branded fashion apparel in ’99 and ended up burning through $135 million in 2 years.
15 — The general has to strictly adhere to the military method — Sun Tzu
The military method — Measurement, Estimation of Quantity, Calculation, Balancing and Victory. Measurement owes its existence to earth, Estimation of quantity to measurement, Calculation to Estimation of quantity; Balancing of chances to Calculation; and Victory to Balancing of chances.
In business, Brand Identity owes it’s existence to users, user context — Brand Culture of a business owes its existence to Brand Identity — Core Capabilities owes its existence to Brand Culture — Balancing, Strategy Choices owes its existence to Core Capabilities — Business Success owes its existence to Strategy Choices.
16 — To understand the enemy, you need to let him down his guard — Sun Tzu
To let the enemy down his guard, you need to feign confusion in your army, feign timidity — Hiding order beneath the cloak of disorder; concealing courage under a show of timidity; masking strength with weakness is tactical dispositions in a war.
To understand your consumers, you need to throw away all biases and keep a blank mind — Hide your knowledge beneath the cloak of curiosity to understand the users, Conceal your emotions under a show of solid body language so that you would not influence your users or affect your own judgement, mask your own experiences with a blank mind are tactical dispositions to understand a user’s needs, desires, emotions.
When we do qualitative research, an open, unbiased mind would help us to understand a user’s perspective on the problem. I agree that we may not be able to start any project without prior knowledge and expectations, but we need to understand that our expectations, cognitive bias might end up controlling our judgement as well as research subject’s views.
Building a Great Business and The ‘Art Of War’ Strategy — Part 04
17 — Be the first to occupy the strategic positional advantage — Sun Tzu
Building a Great Business and The ‘Art Of War’ Strategy — Part 02
05 — A war’s strategy is to “Hold Out Baits” — Sun Tzu
Building a Great Business and The ‘Art Of War’ Strategy — Part 01
01 — The war is a matter of life and death, a road either to safety or to ruin — Sun Tzu
References: The art of war by Sun Tzu and notes by Lionel Giles, Good to great by Jim Collins, Playing to Win by AG Lafley, Wired to Care by Dev Patnaik, What is Strategy by Michael Porter, Blue Ocean Strategy, The hard thing about hard things by Ben Horowitz, Something really new by Denis Hauptly, The power of habit by Charles Duhigg, Strategy that works by Cesare R. Mainardi and Paul Leinwand