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Business is War

Business is War

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Published by: rinkyrajput on Feb 20, 2010
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Business As War 
October 31, 1993
 
Business in the New Economy is a civilized version of war. Companies, notcountries, are battlefield rivals.
In Clausewitz's terms, the era of "set-piece" competition is over. We have entered the era of totalcompetition. No matter your industry, company, or nationality, there is a battle-ready competitor somewhere who is busy thinking how to beat you. There are no safe havens.Yet the hard truth, for all the talk of new paradigms, reengineering, and organizational learning, is thatmost executives in most companies are still equipped to fight the last war. Their strategic assumptions,management structures, information systems, and training programs are geared to a competitivebattlefield that no longer exists. The rules of engagement have changed. Strategic mind-sets have not.In the life-or-death quest for strategic change, business has much to learn from war. Both are aboutthe same thing: succeeding in competition. Even more basic, both can be distilled to four words:informed choice/timely action. The key objective in competition - whether business or war - is toimprove your organization's performance along these dimensions:
To generate better information than your rivals do
To analyze that information and make sound choices
To make those choices quickly
To convert strategic choices into decisive actionTogether they represent informed choice/timely action.
Why Companies Fail
It's no secret why companies fail. The failure starts at the top. CEOs and their senior executives knowthe problems; in fact, in the privacy of their offices, they'll volunteer them to you."We have the information in the company. But we don't seem to get it to the right place.""We get the information to the right place. But then we can't seem to make the choices we should.""We're okay at choosing what to do, but we're too damned slow. By the time we pull the trigger, thetarget's moved.""We know what needs to happen. But we never seem to execute. I never see action."For some companies, the list of symptoms includes bad habits that slowly erode performance: rivalriesin the executive suite, endless turf consciousness, resource struggles between business units. Inshort, functional boundaries drive a wedge between managers who should be on the same side butwho act like the Army, Navy, and Marines competing to see who leads the invasion. In these casesyou hear sentiments like, "We can't pull together, we're always pulling separately. There's too muchinternal friction around here."In every struggling large company I've seen, the symptoms are the same. It's all just a matter of whereit hurts worse.
Why Companies Fail, Part 2
 
It's no secret why companies fail. They fail because over the last 20 years they have been taught tofail. Think of it as Joe Stalin Visits Corporate America: "We have a five-year plan. The five-year plan isin a three-ring binder. The three-ring binder is on a shelf in the CEO's office. The five-year plan setsgoals. We will meet or exceed those goals."In this all-too-familiar model, the pieces of the company and the pieces of the strategy are brokendown into separate elements. Line is separate from staff. Market research has nothing to do withproduct positioning. There's no connection between strategy and operations.Companies then decompose pieces of their strategy into separate projects and assign them out todifferent people in different places - people who have never worked together, never even met eachother. In fact, these people were hired, promoted, motivated, and rewarded in ways that trained themnot to like each other, not to trust each other, not to help each other, not to speak to each other. Theywere trained not to work together.In this respect, right through the Vietnam War, big companies and the military shared much the sameapproach to strategy. Both labored under institutional dynamics that virtually guaranteed competitivedefeat. The terrible irony of Vietnam was that the United States won every battle but lost the war. Mostmilitary histories of the Vietnam War agree on the reason for defeat: the military had no unifiedstrategic doctrine, no clear definition of victory.American business had its Vietnam 10 years after the Pentagon did. In the 1980s, one company after another confronted agile domestic competitors and new global rivals. These "guerrillas" exposed theflaws of business-as-usual. Like the Pentagon, business learned its lesson the hard way. Now it mustlearn to change.
Carl von Clausewitz: Business is War 
"Rather than comparing [war] to art we could more accurately compare it to commerce,which is also a conflict of human interests and activities; and it is still closer to politics,which in turn may be considered as a kind of commerce on a larger scale."
On War 
, Book I, Ch. 3"Business is war. Arm yourself." Motoman 2-page ad in
Manufacturing Engineering 
,August 1994.
Mission Statement
 Clausewitz.org is about putting the principles of history's greatest leaders andorganizational developers to work in the modern workplace.Levinson ProductivitySystems, P.C. offers management consulting services that can make these principles work for your organization.
Overview
War is the oldest form of competition between human organizations; business is arelative newcomer. There were no large business organizations (with a few exceptions,like Britain's East India Company) until a couple of centuries ago. Humans have beenfighting wars for millennia and war has driven the evolution of techniques for organizing,supplying, leading, and motivating large numbers of people.The idea of 
quality management systems
, or mutually supporting and synergisticactivities that make sure "things go right," is but a few decades old. The ISO 9000standard for quality systems is, as of 2000, less than a decade old. The harshest possible
 
environment, one in which not only natural forces but the opponent is trying to cause anorganizational system to fail, drove the evolution of military organizational systems.Many aspects of these systems are adaptable to civilian activities.History's greatest generals may or may not have been outstanding strategists andtacticians but they were always outstanding
organizational developers
. Two of thegreatest commanders who ever lived, Alexander the Great and the Russian field marshalAlexander V. Suvorov (1729-1800), created or improved outstanding organizations.Alexander's father Philip II developed the Macedonian Army into a highly professional
 fighting organization. Philip's innovations included drills, logistics for rapid movement,and equal discipline for officers and enlisted troops. Alexander maintained this system,and his personal behavior earned the commitment of his troops.
Frederick William I left his son, Frederick the Great, a superbly-trained army. Asthese soldiers suffered attrition through battle or retirement, Frederick's ability towin declined. Although Frederick was a skilled tactician and strategist, he was nota great organization-builder.Suvorov encouraged self-direction and innovation by enlisted soldiers in an era when
 commanders relied on tight control: Taylorism before Frederick Winslow Taylor.Suvorov's leadership, like Alexander the Great's, promoted outstanding commitment,morale, and enthusiasm.
Intellectual Heritage of Clausewitz.org
Every thoughtful man has an idea of what ought to be; but what the world is waiting for is a social and economic blueprint. …We want artists in industrial relationships. We wantmasters in industrial method, both from the standpoint of the producer and the product.We want those who can mold the political, social, industrial, and moral mass into a soundand shapely whole.--Henry Ford,
 Ford Ideals
(1922)Quoted in the Preface to Levinson, 2002,
 Henry Ford's Lean Vision: Enduring Principles from the First Ford Motor Plant 
(Productivity Press).
Through the travail of the ages,
 
Midst the pomp and toil of war 
 
Have I fought and strove and perished
 
Countless times upon this star.
 
In the forms of many peoples
 
In all panoplies of time
 
Have I seen the luring vision
 
Of the victory Maid, sublime.
 
I have known the call to battle
 
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