You don’t know Sun Tzu

An out­side the box strate­gic dis­cus­sion by Ted S Galpin

You don’t know Sun Tzu

Well, actu­ally maybe you do.  But Prob­a­bly not the same way I do.

I’ve been work­ing long days on the strat­egy book, and Sun Tzu cer­tainly takes some time to inter­nal­ize.   There’s a say­ing — “there’s noth­ing new under the sun.”  That’s true in sci­ence, espe­cially strat­egy.  Today we are talk­ing about what the mil­i­tary calls “net assess­ment.”  It hap­pens to be the first chap­ter in Sun Tzu’s “Art of War.”  You’ll prob­a­bly rec­og­nize these ideas from busi­ness the­o­ries out there, it’s a com­mon and often poorly exe­cuted con­cept in strat­egy and intelligence.

Assess­ment is the details of “Know your self and know your enemy, and you will win a thou­sand bat­tles.”   If noth­ing else, you need to have a holis­tic assess­ment of where you are and what you face; or what you don’t know will likely end you.

Sun Tzu has the best method for assess­ment I’ve found (though I have found many adap­ta­tions or rein­ven­tions).  There’s noth­ing new under the sun.

And sorry it’s a lit­tle late, had some tech­ni­cal prob­lems to rem­edy.  Hope­fully this is worth the wait.

Sun Tzu Bing Fa?
The prob­lem with Sun Tzu
Tao —
Pur­pose & Val­ues
Tian — The Envi­ron­ment
Di – Sit­u­a­tion & Posi­tion
Jiang — Abil­ity of Deci­sion Mak­ers
Fa — Meth­ods & Tech­nol­ogy
Bal­ance of advan­tage
The take away
So what?

A statue of Sun Tzu

Statue of Sun Tzu in Yuri­hama, Tot­tori, Japan (com­pli­ments of Wikipedia).

Sun Tzu Bing Fa?

You’ve prob­a­bly heard of it as  Sun Tzu’s Art of War, the Chi­nese clas­sic now ingrained in pop­u­lar cul­ture.  Most have no inten­tion of read­ing it, and those of us who try get headaches.  How­ever it is well regarded across the globe as the old­est and most author­i­ta­tive work on strat­egy.  So in strate­gic sci­ence we work through the headaches to try and unlock the enigma.

The Art of War is the Eng­lish title as trans­lated by Lionel Giles, the first author­i­ta­tive Eng­lish trans­la­tion made in Britain 100 years ago, ded­i­cated as a gift to his brother, a mil­i­tary offi­cer at the time.

The Chi­nese title is “Sun Tzu Bing Fa.”  The lit­eral trans­la­tion can be made as “Mas­ter Sun’s Com­pet­i­tive Meth­ods” or more appro­pri­ately “Mas­ter Sun’s Strat­egy.”  The “Art of War” how­ever is a far more roman­tic and poetic title, that reflects the mar­tial nature of the text (and likely a choice influ­enced by Machiavelli’s work of the same name).

The prob­lem with Sun Tzu

Is under­stand­ing what he left behind.

The con­text

Is largely ancient Chi­nese feu­dal king­dom sur­vival, around the war­ring states period.  The Strate­gic the­ory is mar­ried to the mil­i­tary sci­ence, and rooted in Taoist phi­los­o­phy.  So many dis­miss the book as mil­i­tary sci­ence or Chi­nese phi­los­o­phy; rather than gen­eral strat­egy (It’s actu­ally all three).  Schol­ars often stress that the idioms are largely Taoist and eas­ily mis­lead­ing to west­ern readers.

The lan­guage

Is hard for flu­ent schol­ars.  And lit­er­ally ancient.  Any given char­ac­ter in the text has mul­ti­ple mean­ings, some of which don’t directly trans­late well to Eng­lish con­cepts.  Just skim­ming the chap­ter title trans­la­tions on the Wikipedia page shows the dif­fi­culty of pre­cise trans­la­tion for sim­ple 1 or 2 char­ac­ter chap­ter titles.  It was writ­ten poet­i­cally on bam­boo strips, rep­utably with math­e­mat­i­cal log­i­cal rela­tion­ships that don’t really trans­late to Eng­lish text (espe­cially con­sid­er­ing most trans­la­tors are lin­guists and his­to­ri­ans, not math­e­mati­cians versed in trans­lat­ing Chi­nese for­mula into west­ern math­e­mat­i­cal sym­bols.  And who buys a math book on Sun Tzu? I’ll bet there is a small audi­ence for:


(Though per­son­ally I really miss the proofs we did in topol­ogy and abstract alge­bra, and enjoy that sort of exercise.)


The Thomas Cleary and Gary Gagli­adri trans­la­tions very care­fully admon­ish that with­out a knowl­edge of Chi­nese lan­guage, cul­tural idioms, the his­tor­i­cal con­text, Tao­ism, and the struc­ture of the orig­i­nal text, under­stand­ing even a very good Eng­lish trans­la­tion is challenging.

So that leaves me spend­ing a few weeks with sev­eral dif­fer­ent copies of The Art of War, Gary Gagliardi’s handy translit­er­a­tion of the Tai­wanese Military’s com­plete ver­sion of Bing Fa, and my dog eared copies of Tao Te Ching and Tao of Pooh, and hun­dreds of online searches  to try and make up for my west­ern education.

Start­ing with the orig­i­nal Chi­nese Char­ac­ters, in true strate­gic sci­ence fash­ion the exer­cise here is to find the gen­eral core con­cepts in Bing Fa and present them in pre­cise sim­ple language.

Mas­ter Sun’s 5 Prin­ci­ples of strate­gic assessment

Tao — Pur­pose & Val­ues

Tao trans­lates to “Way” or “Path.”  See­ing that Tao­ism is a sub­ject onto itself, we will tread lightly.  For strate­gic assess­ment, in the con­text of mea­sur­ing an orga­ni­za­tions com­pet­i­tive advan­tage, Tao is the organization’s pur­pose and values.

This is impor­tant in terms of both strate­gic align­ment of action, and achiev­ing max­i­mum com­pli­ance from your peo­ple.  Peo­ple fight harder for a cause they believe in.  And in both east­ern and west­ern thought there is often a moral advan­tage con­sid­ered in a higher pur­pose.  You can make sim­i­lar argu­ments using incen­tive based game the­ory and ratio­nal choice on the advan­tage of a moti­vat­ing pur­pose and shared val­ues.

How hard do I work on unpaid over­time that only keeps my boss happy and earns some face­less exec­u­tive a bonus?  By com­par­i­son, how hard do I com­mit myself when I’m help­ing my friends or fam­ily?  That’s why vol­un­teers defend­ing their homes often enjoy sig­nif­i­cantly higher com­bat com­pli­ance then invad­ing pro­fes­sional mer­ce­nar­ies.  Pro­tect­ing your fam­ily and home is a much stronger moti­va­tion than fol­low­ing orders, plun­der, or fear of pun­ish­ment.  Like wise how many of you know exec­u­tives that bad mouth the company’s mis­sion state­ment, core val­ues or code of ethics?  Why would you trust or risk your­self for lead­er­ship that does that?

The first assess­ment is who has the most advan­tage from the effec­tive­ness and align­ment of the their organization’s pur­pose and values?

Tian — The Envi­ron­ment

Tian trans­lates to “heaven” or “divine prov­i­dence.”  It’s like ask­ing who’s side nature is on.  When Mas­ter Sun rec­om­mends to dis­cuss heaven he means what are the advan­tages and dis­ad­van­tages that no one con­trols.  These are exter­nal con­di­tions of the cli­mate, sea­son, or envi­ron­ment like weather, the econ­omy, reg­u­la­tions, laws, and com­mod­ity prices.  Try­ing to find busi­ness financ­ing in 2007 is very dif­fer­ent than 2009.  Sea­sons may change, but they are also beyond your control.

So which orga­ni­za­tion enjoys more com­pet­i­tive advan­tages from the nature of the envi­ron­ment?  The clas­sic exam­ple is the strate­gic mil­i­tary advan­tage that Rus­sia enjoys in the win­ter.  Hitler and Napoleon both failed to invade Rus­sia because they failed to con­sider the harsh Russ­ian win­ter.  On the other hand, the long Russ­ian win­ter ices over ports, com­pli­cates logis­tics and work­ing con­di­tions, and cre­ates an eco­nomic disadvantage.

Cur­rent envi­ron­men­tal busi­ness fac­tors are the econ­omy, poor avail­abil­ity of financ­ing, still rel­a­tively cheap energy and the poten­tial of envi­ron­men­tal reg­u­la­tion of energy.  But if you’re hir­ing there is a plen­ti­ful and well moti­vated labor pool for most skill sets.  So a grow­ing com­pany, if it can find cap­i­tal, would enjoy cheaper growth costs and bet­ter staffing today than say 5 years ago in a dif­fer­ent climate.

The sec­ond assess­ment is the nat­ural envi­ron­men­tal fac­tors and who gains an advan­tage or dis­ad­van­tage from them.  Tim­ing is everything.

Di — Sit­u­a­tion & Posi­tion

Di trans­lates to “Ground,” “Place,” “Sit­u­a­tion,” or “Posi­tion.” Or as the cliche’ goes “Loca­tion, Loca­tion, Loca­tion!”  These are the exter­nal con­di­tions that can be cho­sen or con­trolled.  You may not be able to con­trol the weather, but you can choose the time, place, and posi­tion of your bat­tles.  This can be fight­ing down­hill or locat­ing your fac­to­ries near cheap for­eign labor.  The Red Barron’s dog fight­ing posi­tion­ing based on the Dicta Boel­cke is great exam­ple — if pos­si­ble keep the sun to your back, and attack tar­gets from above and behind.

Michael Porter’s Five Forces analy­sis is a pop­u­lar tech­nique for assess­ing a busi­ness mar­ket posi­tion.  It con­sid­ers the posi­tions of your sup­pli­ers, cus­tomers, exist­ing com­peti­tors, new com­peti­tors, and sub­sti­tute prod­ucts; and can be used to deter­mine how to posi­tion your­self to succeed.

You can choose when, how, and where you com­pete.  Is the posi­tion close or dis­tant?  Do you have room to maneu­ver?  Is the posi­tion easy or dif­fi­cult to obtain and con­trol?  Find a posi­tion where you can­not lose.

Obvi­ously posi­tions change.  A west fac­ing hill side is a great uphill advan­tage until the sun sets in your face and blinds you.  Or you can sim­ply be unable to main­tain you posi­tion and lose it.  Com­pe­ti­tion is often about fight­ing over advan­ta­geous position.

The third assess­ment is who enjoys the most sit­u­a­tional or posi­tional advantages.

Jiang — Abil­ity of Deci­sion Mak­ers

Jiang means the “gen­eral” or “lead­er­ship.”  Mas­ter Sun uses it to mean the abil­ity of deci­sion mak­ers.  Assess the deci­sion makers’:

Intel­li­gence. Are they knowl­edge­able and pos­sess good judg­ment?  Can they make quick deci­sions?  Do they have the right skills?
Trust.  Do they inspire trust?  Can they be trusted?  Do they trust their sub­or­di­nates?
Love.  Do they take care of their peo­ple and care about the cost of vic­tory?
Brav­ery.  Are they will­ing to take the right risks and stand up to their fears?  Do they inspire brav­ery in oth­ers?  Are peo­ple will­ing to fight for them?
Dis­ci­pline.  Are the able to do the right thing at the right time con­sis­tently with­out over­sight?  Do they main­tain con­sis­tent dis­ci­pline, incen­tives and expec­ta­tions in the organization?

Now this may be the most sub­jec­tive part of the assess­ment, but typ­i­cally speak­ing, human resources and cus­tomer sat­is­fac­tion bench­marks alone may speak vol­umes.  Here the trick is not to judge by rep­u­ta­tion, rather by evi­dence to the above criteria.

The fourth assess­ment is the abil­ity of the deci­sion makers.

Fa — Meth­ods & Tech­nol­ogy

Fa trans­lates to meth­ods, skills, prac­tices, tech­niques, or doc­trine.  For the pur­pose of strate­gic assess­ment it means skill level and effec­tive­ness of your meth­ods, and the effec­tive­ness of the tech­nol­ogy used.  This is how good your orga­ni­za­tion is at what it does, and the qual­ity of it’s tools and weapons.  How strong, how fast, how effec­tive are your processes, logis­tics, and end prod­ucts?  How well trained are your people?

As John Kee­gan wisely argues in his book “Intel­li­gence in War” even when good intel­li­gence is avail­able, you can’t win a bat­tle if you don’t know how to fight.  When com­pe­ti­tion gets fierce, the stronger com­peti­tor always enjoys that advantage.

The effec­tive­ness of your meth­ods and skill at exe­cut­ing them is one of the sin­gle most impor­tant advan­tages you can have.

Tech­nol­ogy can­not be dis­missed.  In 480 and 490 BC inva­sions of Greece, the Greeks tech­no­log­i­cal advan­tage over the Per­sians was sim­ply the Hoplite heav­ier armor and weapons.  Greeks used longer spears, and metal shields; Per­sian spears were shorter, their shields were wicker.  Nobody real­ized the advan­tage of stealth tech­nol­ogy and mod­ern Amer­i­can air power until tested against the world’s 4th largest mil­i­tary dur­ing Desert Storm in 1991.

How­ever, new tech­nolo­gies that com­pli­cate processes and require sig­nif­i­cant train­ing are often a com­pet­i­tive dis­ad­van­tage.  A won­der­ful exam­ple is BYD who fig­ured out how to make supe­rior prod­ucts with inex­pen­sive Chi­nese engi­neers and labor inten­sive man­u­fac­tur­ing meth­ods; beat­ing out com­peti­tors using exotic processes and indus­tri­al­ized robotic manufacturing.

The sub­tle con­text of this is train­ing.  Supe­rior tech­nol­ogy and meth­ods only work if the peo­ple have the train­ing to use them to an advantage.

Meth­ods and tech­nol­ogy may be dif­fi­cult to mea­sure directly; like lead­er­ship you may have to mea­sure them through indi­rect means, or sim­ply test their effec­tive­ness through direct com­pe­ti­tion.  But you can fig­ure out who’s got the advan­tage and what it is.

The fifth assess­ment is who’s meth­ods, tech­nol­ogy and train­ing give greater advantage?

Bal­ance of advantage

Mas­ter sun then advises you add up all the advan­tages and dis­ad­van­tages found in the assess­ment, and you will see who has the over­all advan­tage.  If your mea­sure­ment of assess­ment is accu­rate, you can pre­dict the winner.

For exam­ple, In WWII the Nazi’s enjoyed home field defen­sive advan­tage, more expe­ri­ence, more sophis­ti­cated meth­ods and best of breed tech­nol­ogy in most cat­e­gories; but supe­rior tech­nol­ogy, a more expe­ri­enced army, and home field advan­tage did not make up for poor pur­pose and val­ues, not to men­tion inten­tion­ally dis­or­ga­nized over­lap­ping lead­er­ship that could not exe­cute an effec­tive strate­gic deci­sion with­out Hitler’s micro­manag­ing approval.

The final assess­ment is the net assess­ment.  Add up the advan­tages and dis­ad­van­tages on each side, and you’ll have great insight into who will win, who will lose, and why.

The whole point of net assess­ment is to holis­ti­cally under­stand everyone’s strengths and weak­nesses, so you can maneu­ver your strengths against your competitor’s weaknesses.

The take away

As I said at the begin­ning — prob­a­bly noth­ing there that hasn’t been said in a dozen busi­ness man­age­ment books.  Sun Tzu just nicely brings in all together in a cou­ple of pages.

Once you’ve made the five assess­ments, Mas­ter Sun chal­lenges the net assessment:

Which polit­i­cal lead­er­ship holds the right pur­pose and val­ues?
Which man­age­ment posses supe­rior skill?
What sea­son and posi­tion pro­vide supe­rior advan­tage?
Which method of com­mand and con­trol works best?
Which force is stronger?
Which peo­ple have bet­ter train­ing?
Which incen­tives and dis­ci­pline are most con­sis­tent and clear?

These tell you who will win and who will lose.  If you want to win, You need to develop an orga­ni­za­tion that is com­pet­i­tive on every above point, e.g. the five assess­ments and the net assess­ment ques­tions.  If you are assess­ing strat­egy for com­pe­ti­tion, this is how you iden­tify the key strengths and weaknesses.

This net assess­ment should make it obvi­ous what you need to do to win. And just as impor­tantly, what won’t work (please, never again try com­pet­i­tive entry into Rus­sia dur­ing the winter).

Now here’s the trick.  Assess­ment of your inter­nal busi­ness is prob­a­bly han­dled by finance, busi­ness ana­lysts and busi­ness intel­li­gence.  The assess­ment of busi­ness com­peti­tors is prob­a­bly done by either mar­ket research, com­pet­i­tive intel­li­gence, or lack­ing that, a cou­ple of proac­tive leaders.

That should show an obvi­ous dis­con­nect.  If your inter­nal ana­lysts and exter­nal ana­lysts are dif­fer­ent depart­ments, with dif­fer­ent goals, meth­ods, and val­ues… Then your busi­ness is prob­a­bly inca­pable of mak­ing a valid net assessment.

So what?

If, and only if you can coor­di­nate and com­bine inter­nal and exter­nal scopes of busi­ness to align, mea­sure, com­pare, and con­trast your inter­nal assess­ments with your exter­nal assessments; then, and only then have you legit­i­mately com­pleted the step so fun­da­men­tal to strat­egy that Sun Tzu put it on the first page of The Art of War.

If you don’t have a strate­gic assess­ment, or worse, your strate­gic assess­ment is patched together from unaligned work prod­ucts from dif­fer­ent groups — then your strat­egy won’t be based on the rel­e­vant facts; and will likely fail when those facts deter­mine com­pet­i­tive advantage.

If you’re look­ing for some­thing use­ful for the com­pet­i­tive intel­li­gence folks to do?  Have them do a net assess­ment, and have them start on your inter­nal assess­ment first.  That will pro­vide the tem­plate for exter­nal assessments.

But how do you use that every­day? What does this actu­ally mean for you as an individual?

Well, if you want to enjoy per­sonal com­pet­i­tive advan­tage.  Con­sider your pur­pose and val­ues.  Are they work­ing to your strate­gic advan­tage?  Think about your envi­ron­ment, what is the tim­ing good for?  Where can you posi­tion your­self?  How do you rate on the 5 abil­i­ties of deci­sion mak­ers?  Can you improve your abil­i­ties?  What meth­ods and tech­nol­ogy do you have avail­able?  Can you improve them?  Sim­ply under­stand­ing these prin­ci­ples for your­self, your fam­ily, and the groups you work with will allow you to be bet­ter at any­thing you want to do.

If you ever find your­self in a com­pet­i­tive envi­ron­ment, you can then make the com­par­a­tive net assess­ment of your oppo­nents and obsta­cles to best align what you have, to the oppor­tu­ni­ties for suc­cess that your com­peti­tors pro­vide you with.

Thanks for reading,

Your hum­ble strategist,

Ted S Galpin

3 responses to “You don’t know Sun Tzu”

  1. "The effec­tive­ness of your meth­ods and skill at exe­cut­ing them is one of the sin­gle most impor­tant advan­tages …

  2. Reading: You Don't Know Sun Tzu –

    1. Dave,Trick question. It’s a matetr of context.A clarification would be If your organization has a formal function, and the leadership does not utilize it as the primary source of intelligence; there’s something very wrong. The Jack Ryan / Tom Clancy Analogy would be if your the national security advisor, and your not the first call the president makes for defense intelligence, you’re not doing your job.The word executive connnotates senior leadership, not CEO exclusively VP’s, directors, budget owners and departments heads. Really any key stakeholders or decision makers.The point of the article is in most organizations, regardless of size, there is a formal competitive intelligence function, that has yet to establish itself as a credible member of the hierarchy. This article explains how to use techniques borrowed from , , and practices to establish trust, influence and credibility within the organization. And keep in mind most competitive intelligence functions are managed directly by an executive who should not have significant hierarchical barriers, rather cultural barriers.Now at the heart of the article, whether a formal or informal intelligence function, one can use intelligence trade craft to circumvent the hierarchy. Now it will take time to establish a social network and penetrate the organizational barriers. And there may be limits to what you can accomplish with your rank and location. Kids in the mail room rarely get access to the CEO regardless; but a sophisticated CEO should be aware of what’s going on in the mail room; you find ways to leverage that need and curiosity to your operational advantage.The ENTIRE POINT of the article is a good intelligence professional should be able to identify their audience, and form a direct, likely informal relationship with their audience (hopefully some key decision makers). Which means the first target of should be your organization to identify those people within the organization and figure out how to reach them.Because without a relationship with key decision makers, competitive intelligence functions have no , and frequently are the budget that gets eliminated during .

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