Business is considered analogous to war. Many a parallel can be drawn between the two.
WarBusinessBaseCompanyTerritoryLandSoldiersEmployeesResourcesCapitalFlagLogoOfficersManagersGlobal ConquestRevenue and ProfitBloodshed and DeathExhaustion and LayoffsGeneralsExecutive OfficersCommander-in-ChiefCEOConsolidate and ConquerGrow Domestically and then Internationally
One has to be as careful as possible in making decisions in business, as in war. Each decision holds its weight in gold, and has consequences for both the firm and the competitor. Similar to a war in which a country tries to grow within and then consolidate power and conquer others, a business tries to attack those countries that have valuable resources which it can exploit to its advantage. The similarities between war and business are very clear.
The Art of War is an ancient treatise supposed to be authored by a high ranking official of Chinese origin, Sun Tzu. The book is one of the oldest and most successful military strategy books in the world. It has gathered appreciation from most leaders and rulers of history.
Much of the book explains the art of winning a war without fighting a battle. This can be linked to modern day office politics, business competition and corporate strategy.
The Psychological-Cognitive Analysis of Characters
The Art of War talks about the role of a king or a general in conducting diplomacy and inventing strategy to take down one’s opponents, not necessarily always on the battlefield. For this it prescribes five philosophies, namely
The basic psychology expected of any general is to be mindful of these factors when making decisions.<br />The Art of War advocates ruthlessness in combating enemies. It advises caution while dealing with forces bigger than one and concludes that surprise and secrecy are the most important weapons of competition. Extraversion, openness to experience and intelligence are the most common traits of a leader.<br />
Learning Insights and Managerial Implications
The use of Sun Tzu’s The Art of War in management can be elaborated by focusing on the 8 questions that he asks in Chapter 1 namely Laying Plans,
Which of the two sovereigns is imbued with the moral law? or Mission
A leader uses the right proportions of wisdom, credibility, benevolence, courage and strictness to direct his followers. The type of leader is usually affected by his circumstances, which is the Work-Unit theory. Sometimes the leader influences the follower’s idea of the goal, which is called the Path-goal theory. By the implicit leadership theory, leaders try emulating their ideas of a powerful leader.<br />
Which of the two generals has the most ability? or Leadership
The manager who has prepared the most, is most aware of his team, is most aware of his competitors strengths and weaknesses, chooses his allies and enemies wisely has the more ability. His interaction with his team is paramount to success for the organization.
With whom lie the advantages derived from Heaven and Earth? Or Environment
The environment is divided into external conditions and internal conditions. External conditions consist of raw materials, power and transportation. The internal conditions consist of the plant, equipment, cash flow, technology and licenses. These are objective in nature. For the subjective part, external conditions include customer and supplier, strategic partners, shareholders, government regulators and the society. The internal condition is the organizational culture, which is learnt through organizational socialization. Once established they are hard to change and the stronger they are the better the performance of the individual and the company.
On which side is discipline most rigorously enforced? Or Rule & Order
Regulations and rules bind the group and the leader from going wayward away from their mission. Rules are supposed to be fair, enforceable, comprehensible, time-bound and measurable.
Morale is the spirit of positive belief, hope and optimism, which encourages team-work and enthusiasm amongst employees. The morale is gained, by educating the employees of the company’s vision and mission, by engaging them with belief, by assuring them a long-term gain through it and by a robust rewarding or punishing system.
On which side are the officers and the army more highly trained? Or Training
Skills are essential for defeating your competitor or opponent. This is done by effective training, imbibing organizational culture. This gives us the competitive advantage.
In which army is there the greater constancy both in reward and punishment? Or Encouragement
Reward and punishment are essential drivers for performance. It encourages activity and innovation. It is natural to want more for human being it a material addition or non-material like prestige. Some methods used in management these days are performance bonus, balance scorecard, stock options and the 360 degree test.