Sun Tzu's Art of War, as Applied to Business

So, the previous blog post mentioned Sun Tzu.

Who was Sun Tzu? He was a Chinese strategist who lived in the 6th century, BC. He wrote a book called The Art of War, considered to be pretty much THE definitive treatise on strategic thinking. It is on the reading lists of more than one military academy, but recently leaders in other fields such as sports and business are drawing inspiration from it as well.

Here are some of the things Sun Tzu said:

"Know yourself, know the enemy; a hundred battles, a hundred victories."
Which is followed by "know yourself but not the enemy; fifty victories, fifty defeats" and "know neither yourself nor the enemy; a hundred battles, a hundred defeats." Of course, in business it is often impossible to know everything about one's competitors - at least, not without crossing certain legal and ethical lines. However, it is also important to know yourself. What exactly are you selling? A lower price? Higher quality for higher price? Comparable quality but better service for a higher price? An example of this is Wendy's - Wendy's entered the fast-food game rather late, and most of the good locations were already taken by McDonalds. So Wendy's just rolled with it. Instead of competing as another McDonalds, decided that they were going to be the "Anti-McDonalds," the alternative for people who want to try something different. Any time you see a Wendy's, there's a good chance that there's a Mickey D's close by.

"Fighting and winning a hundred battles is not the acme of skill. Winning a hundred battles without fighting is the acme of skill."
Things don't necessarily have to be win-lose. Strive for win-win, if at all possible. Rather than driving out a rival through a price-war, better to simply arrive at an understanding so that both parties are able to stay in business and earn reasonable amounts of money. Not to mention that in the business world, if you really do "win a hundred battles," people may begin raising accusations of "monopoly." Chinese companies try to do this, which has the additional bonus of maintaining harmonious relationships with competitors.

"If your enemy is secure, prepare for him. If he is strong, evade him. If he is easily angered, irritate him. Pretend to be weak, so that he may grow arrogant...attack when he is unprepared, appear when you are unexpected."
I would argue that Apple's somewhat recent rise is a great example of this. I had vague recollections of using a Mac in the early years of elementary school, then everyone seemed to have switched to Windows. Then Apple suddenly pops out with an iPod and all these other cool gagdets and blew everyone's mind, earning them a nice chunk of change in the process. This was also an example of the first quote, as Apple did the research and understood that they could not beat Microsoft on functionality - Microsoft had become so established that even if Apple was better, the switch between operating systems would still be too costly. Instead, Apple went after the younger crowd, people who didn't just want technology that worked, but technology that looked cool.

Sun Tzu was also a big fan of using spies. While certainly useful, the ethicality of doing so in the business world is a little sketchy, to say the least. At any rate, I shall conclude this blog post now.

Time to read my Sun Tzu again.