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Topic Professional "Pure intellectual stimulation that can be popped into the [audio or video player] anytime." —Harvard Magazine Strategic Thinking Skills "Passionate, erudite, living legend lecturers. Academia's best lecturers are being captured on tape." —The Los Angeles Times "A serious force in American education." —The Wall Street Journal Strategic Thinking Skills Course Guidebook Professor Stanley K. Ridgley Drexel University Professor Stanley K. Ridgley is Assistant Professor in the Department of Management at Drexel University's LeBow College of Business. He holds an M.B.A. in International Business from Temple University and a Ph.D. in International Relations from Duke University. Once a military intelligence officer in West Berlin, Dr. Ridgley is now an expert in business presentation techniques. He has lectured to audiences around the world and has served as the presentation coach for winning teams in national and international business competitions. Cover Image: © iStockphoto/Thinkstock. Course No. 5913 © 2012 The Teaching Company. PB5913A Guidebook THE GREAT COURSES ® Corporate Headquarters 4840 Westfields Boulevard, Suite 500 Chantilly, VA 20151-2299 USA Phone: 1-800-832-2412 www.thegreatcourses.com Subtopic Thinking Skills PUBLISHED BY: THE GREAT COURSES Corporate Headquarters 4840 Westfields Boulevard, Suite 500 Chantilly, Virginia 20151-2299 Phone: 1-800-832-2412 Fax: 703-378-3819 www.thegreatcourses.com Copyright © The Teaching Company, 2012 Printed in the United States of America This book is in copyright. All rights reserved. Without limiting the rights under copyright reserved above, no part of this publication may be reproduced, stored in or introduced into a retrieval system, or transmitted, in any form, or by any means (electronic, mechanical, photocopying, recording, or otherwise), without the prior written permission of The Teaching Company. Stanley K. Ridgley, Ph.D. Assistant Professor Department of Management Drexel University P rofessor Stanley K. Ridgley is A; ssistant Professor in the Department of Management at Drexel University's LeBow College of Business. He earned a B.A. in Journalism from The University of North Carolina at Chapel Hill, an M.A. in Political Science from Duke University, an M.B.A. in International Business from Temple University, and a Ph.D. in International Relations from Duke University. He has also studied at Lomonosov Moscow State University and the Institut de Gestion Sociale in Paris. Prior to joining the faculty at Drexel, Professor Ridgley was an Assistant Professor of International Business and Strategic Management at the Fox School of Business at Temple University. Professor Ridgley teaches courses on global business policies, international business fundamentals, competitive intelligence, strategic management and entrepreneurship, and advanced strategic business presentations. He has lectured and presented widely to university students and business professionals in the United States, Russia, India, France, Colombia, and Singapore. While teaching at Temple University, he received the Musser Award for Excellence in Leadership. As a presentation coach for teams of business students, Professor Ridgley coached the winning team for Target Corporation's annual Business Case Competition at Temple University in 2010 and 2009 and coached an Indian M.B.A. team's winning presentation in the All India Management Association's 2009 National Competition for Young Managers. He also is the voice and face of Pearson Education's online Business Presentation Instruction Module. i A former military intelligence officer for the U.S. Army, Professor Ridgley served five years in West Berlin and near the Czech-German border. He received the George S. Patton Award for Leadership from the 7th Army NCO Academy in West Germany. ■ ii Table of Contents INTRODUCTION Professor Biography ............................................................................i Course Scope .....................................................................................1 LECTURE GUIDES LECTURE 1 The World of Strategic Thinking .........................................................4 LECTURE 2 The Origins and Relevance of Ancient Strategy ............................... 11 LECTURE 3 The Dawn of Modern Strategic Thinking ..........................................20 LECTURE 4 Modern Principles of Strategic Conflict.............................................29 LECTURE 5 Geography—Know Your Terrain .......................................................37 LECTURE 6 Grand Strategists and Strategic Intent .............................................45 LECTURE 7 The Core and the Rise of Strategic Planning ...................................54 LECTURE 8 Which Business Strategy? Fundamental Choices............................62 LECTURE 9 Your Competitive Advantage—Find the Blue Ocean ........................70 LECTURE 10 Strengths, Weaknesses, Opportunities, Threats ..............................78 iii Table of Contents LECTURE 11 Avoid the Pathologies of Execution ..................................................85 LECTURE 12 Tactics of Combat as Problem-Solving Tools ...................................92 LECTURE 13 Shock of the New—Inflection Points ..............................................101 LECTURE 14 Surprise! Perils and Power of Strategic Deception.........................109 LECTURE 15 The Sources and Uses of Reliable Intelligence .............................. 117 LECTURE 16 Move and Countermove—The Theory of Games...........................124 LECTURE 17 The Evolution of Cooperation .........................................................131 LECTURE 18 When Strategy Breaks Down .........................................................138 LECTURE 19 Leverage Cognitive Psychology for Better Strategy .......................146 LECTURE 20 Strategic Intuition and Creative Insight ...........................................155 LECTURE 21 From Systemic Problems to Systemic Solutions ............................161 LECTURE 22 Seize the Future with Scenario Analysis ........................................167 LECTURE 23 The Correlation of Forces, Luck, and Culture.................................175 iv Table of Contents LECTURE 24 Strategic Thinking as a Way of Life ...............................................182 SUPPLEMENTAL MATERIAL Timeline ..........................................................................................190 Biographical Notes .........................................................................197 Bibliography ....................................................................................203 v vi Strategic Thinking Skills Scope: S trategic thinking is about unraveling the mysteries of the chaotic world around us and harnessing powerful forces to our own ends. It means utilizing tools of analysis and tactics to take decisive and prudent action that gives us the best possible chance of achieving our objectives— whether those objectives are personal or professional. In this course, we learn what the finest strategic minds of history can teach us and how their insights can transform us into decisive, capable strategic thinkers. We learn how to overcome both internal and external obstacles that block the way to achieving our goals. Strategic thinking sharpens your awareness of the world around you so that previously inexplicable events become intelligible. You begin to connect the dots in many areas and at different levels. Causes and effects, sometimes far removed from each other, take on clarity as we begin to understand the funnel of causality. Seemingly isolated events are connected to each other in patterns that we can readily recognize. The framework for strategic thinking is a series of powerful analytical tools that enables us to make sense of a complex world and can transform the way we think, behave, and interact with others. These are the same tools that inform both corporate strategy staffs and military intelligence units in accomplishing scenario development, strategic choice, and tactical execution. We begin with lectures on the origins of strategy to discover how the concept of strategic thinking emerged in theorizing about ancient warfare and how principles of strategic action began to crystallize in the minds of the great theorist/practitioners. Strategy has its ancient origins in the military, both in Greece and China, so we start there, with the theorist-practitioners Thucydides and Sun Tzu and the ancient battles of Delium and Cannae. Military strategic thought flourished during the Enlightenment, culminating in the Napoleonic era of advanced strategic and tactical developments. Modern efforts to name and systematize principles of military strategy really 1 began with Napoleon. We consider Napoleon's own ideas and actions, as well as the contrasting lessons drawn from Napoleon by the two leading theorists of 19th-century strategy, Jomini and Clausewitz. Entering the modern era, we examine how strategic dynamism began to suffuse and revolutionize the thinking in other realms of endeavor and slowly evolved into an indispensable tool in the worlds of the military, business, politics, sports, and even entertainment. The military principles of combat can be understood as principles of competition, offering us a variety of tactical options for use in our own strategic endeavors. In our middle lectures, we turn to the various tools and intellectual perspectives offered by modern strategic thought. Here, it is important to grasp the difference between strategy and the tools of strategy. Strategy is not a ready-made plan we can pull from a shelf, nor is it a tool we can take from a toolbox. Regardless of the area of endeavor, the key to any successful strategy is an overall sense of mission, what business strategists Hamel and Prahalad called "strategic intent." Far from an empty exercise, crafting a clear and meaningful mission statement shapes the entire strategic planning process. That process as explicated here consists of mission, objective, situation analysis, strategy formulation, strategy implementation, and control. This simple planning process serves as the structure for our thinking and is a constant loop that leads us back to situation analysis. We constantly evaluate the external and internal environments and modify our strategy according to arising needs. Scope We learn the fundamental competitive choices available to us, their advantages and disadvantages, and how to position ourselves for the most successful strategic outcomes. We also learn the sources of competitive advantage and one superb technique—the blue ocean strategy—whereby we may achieve it and sustain it. Where many strategies fall short is in the implementation, the crisp and correct execution of tactics. We review tactics and principles—including the frontal assault, the flank attack, the indirect approach, and rear area battle— 2 that empower us on the field of conflict of our choice, and we explore the special power of surprise and its force-multiplier effect. We also learn of the incredible utility of the intelligence cycle and scenario planning as engines of predictive capability, predictive of both the specific likely actions of competitors and the likely course of macro-factors that can affect our plans. Key to the success or failure of much strategic action, regardless of the venue, is the mindset of the strategist. Lectures on cognitive psychology, strategic intuition, game theory, systemic problems, and perspectives on "luck" demonstrate that our own self-perception and the perception of the world around us can have a tremendous impact on the effectiveness of our strategy. Likewise, one of our lectures encompasses the well-known obstacles to great strategy and relates how these obstacles can often be circumvented if acknowledged and properly considered. The course concludes with a final lecture that sketches the lives of four strategic thinkers, vignettes of powerful and focused idea entrepreneurs who harnessed the power of strategic imagination for their own ventures and achieved tremendous success. In this final lecture, we recapitulate the principles of strategic thinking and illustrate the potential rewards awaiting those who cultivate strategic thinking skills as a way of life, those who do not fear the future but harness its potential for their own benefit. At the end of our course, you may find that your perspective on the world has undergone profound transformation as you begin to see patterns and routines, to identify categories, and to sense the broader macro-shifts in a particular correlation of forces that affect you in unique ways. You gain clarity and you may see the fog of uncertainty begin to clear, replaced by a certitude of purpose and direction as you begin to master the concept of strategic choice—the selection of the correct tools to apply to your unique situation. By adopting various combinations of techniques and tools of analysis, and by seizing a substantial role in developing your circumstances, you improve your chances of achieving your objectives. And this is the great gift of strategic thinking: clarity and efficacy of action in a forever changing and chaotic world. ■ 3 The World of Strategic Thinking Lecture 1 H ow can you learn to plan more effectively, outsmart your competitors, and avoid unpleasant surprises? The answer is strategy. This course arms you with the essential tools that allow you to think strategically in business and in life. In these lectures, you'll learn a broad array of skills and techniques for problem solving, critical decision making, competitive intelligence, and long-term planning. As we'll see, strategic thinking is a way of peering into the future with confidence that our actions today will yield the best possible outcome tomorrow. A Quarterback's Strategic Thinking Consider the crucial 10 to 15 seconds in a football game between the call of a play in the offensive huddle and the snap of the ball. Lecture 1: The World of Strategic Thinking The offense has made a plan to achieve the intermediate objective of moving the ball to make a first down. This plan takes into account the situation on the field, that is, the distance required to make the first down, the number of downs remaining, and the distance needed to score. The defense looks at the same situation on the field and calls a play to resist the offense. What happens next is where truly powerful strategy emerges. In that narrow window of time between the break of the huddle and the snap of the ball, the quarterback collects and processes information on his opponent and may change the play as a reaction to the other team's anticipated course of action. This ability to change the play—or the plan—is what distinguishes genuine strategy: the dynamic of action and reaction that yields optimum results. 4 © iStockphoto/Thinkstock. Powerful strategy emerges in the game of football, with both offense and defense adjusting their lines of attack almost instantaneously based on the actions of their opponents. A Cultivated Skill We aren't born with a fully developed ability to think strategically. It is a skill that must be cultivated and practiced. In fact, most people are stuck in the mode of cognitive confinement, or static thinking; they consciously reject thinking about tomorrow. Albert Einstein once observed that insanity is the propensity to do the same thing over and over again, expecting different results each time. This is the antithesis of strategic thinking, and it occurs in the workplace more often than we'd like to admit. Many of our co-workers or employees don't engage in a methodical process of questioning, evaluating assumptions, gathering information, analyzing and planning, and then taking action. Many people simply function in routines they don't question. We all think about the future, of course, but there is a difference between strategic thinking and daydreaming about what might be. Strategic 5 thinking is about setting goals and developing long-range plans to reach those goals, plans based on careful analysis of internal and external environments and on the actions of others. Strategic thinking involves thinking logically and deeply about the future. It means embracing the idea that where we want to be five years from now should inform what we do today. Key Terms, Definitions, and Concepts The term "strategic intent" refers to the "big ideas" that strategy aims to advance. It is this intent that compels us to think about the future: the home you'd like to buy, the career you'd like to have. The term "strategy" itself refers to more than just a plan. It is a way of Lecture 1: The World of Strategic Thinking perceiving and considering the future with our aims and goals in mind. It is also a way of dealing with a constantly changing environment, both responding to that environment to achieve our goals and attempting, where possible, to change that environment to our benefit. 6 o The ancient military strategist Sun Tzu offers us one of the most well-known examples of strategic theory in his opus The Art of War. Sun Tzu's brilliance lies in his recognition of the fluid nature of reality and the fact that any practitioner of strategy must constantly adapt to it. o In the Western world, the concept of strategy flowered in the 19th century with the work of the French general Antoine de Jomini, most notably his Summary of the Art of War. Jomini's contribution to strategic thinking lies in his identification of interior lines of communication and his notion of concentration of force. o Carl von Clausewitz, a Prussian military officer, disagreed with Jomini in important respects. He viewed uncertainty, chance, and probability as three-fourths of conflict—what he called "friction"— and to overcome this friction, he offered the notion of coup d'oeil, a French expression for a stroke of intuition and genius. This is the concept of the rapid and accurate decision making. o One of the most influential strategists of the 20th century was Sir Basil Liddell Hart, whose contribution was the "indirect approach"—a form of misdirection. Hart's idea was that we should never expend our energies with frontal assaults on an entrenched enemy; instead, we should seek interesting alternative routes to achieve our objectives. Strategy versus Tactics We sometimes hear the word "strategy" used in conjunction with "tactics," but there's a difference between the two. We tend to think of strategy as part of some higher realm of planning, while tactics are the execution of strategy. If your strategy is to become a doctor or lawyer, the courses you take are part of that strategy, but the ways you choose to study and prepare would be tactics. Clausewitz distinguished between strategy and tactics by focusing on levels of conflict. In his words, "Just as tactics is the employment of military forces in battle, so strategy is the employment of battles … to achieve the object of war." Strategy encompasses well-executed tactics and cannot be divorced from tactics. Many a great strategic plan can falter because of a failure to recognize this crucial point. Strategic thinking does not end with the crafting and execution of a strategy. Strategic thinking means constant interaction with the environment during the execution of the strategy. Successful strategy is dynamic, adaptive, and opportunistic, and it depends on the swift, bold, and decisive execution of tactics. Strategic Theory and Thinking The realm of business has proven to be a fertile area for the development of strategic theory. Harvard business professor Michael Porter elevated strategic thinking to a new level of respect in the nation's business 7 schools, beginning with his pathbreaking work in the 1980s on competitive advantage, competition, and strategic thinking. For Porter, "strategy means choosing a different set of activities to deliver a unique mix of value," in other words, doing things differently. This definition bridges the gap between the military and business and between ancient and modern ideas. "Choosing a different set of activities" enabled the ancient general Hannibal to defeat the far more numerous Romans at the Battle of Cannae in 216 B.C. and allowed Apple to play a significant role in the personal computer revolution of the 1980s. Strategic thinking is goal-directed, structured, and focused on the future in a precise way. It is analytical and ambitious. It concerns power and trends, as well as uncertainty and the resolution or accommodation of that uncertainty. Strategic thinking is also instrumental; we use strategic thinking as Lecture 1: The World of Strategic Thinking an instrument to achieve our goals. It becomes a resource, much like money, or time, or labor. Note, too, that it is useful across a range of activities, from the grand and sweeping to the at-home and everyday. The Importance of Intelligence Intelligence and analysis play a significant role in critical thinking, providing the raw material to build a sound strategic structure. Not only do we want to find out what the other side is doing, but we want to mislead our opponents about our intentions, as the U.S. military did with its feigned invasion of Kuwait from the sea during the first Gulf War in 1991. In competitive situations, the "surprise attack" smacks of the not-sogenteel aspects of conflict, but in sports, business, and politics, we can admire a well-crafted surprise. Again, in football, surprise and deception are integral parts of the game and are crucial to gaining competitive advantage. The "draw play," for example, attempts to draw defenders into the wrong parts of the field. 8 Surprise and stratagem serve us as useful tools to advance our strategic goals. Deception can turn a bad situation into a good one, and it can turn a good situation into victory. The five basic types of surprises at our disposal are those of intention, time, place, strength, and style. In a full sense, strategy equips us with tools that help us meet the future with confidence. Tools of analysis can aid our understanding of the powerful forces that shape that future. As we'll see in a future lecture, the SWOT analysis (strengths, weaknesses, opportunities, and threats) is an analytical tool that helps us look at all aspects of a situation to ensure that our strategic intent matches our resources and capabilities. A Robust Definition Strategy is a method or plan that we craft to bring about a desired future, such as achievement of a goal or solution to a problem. It's a plan that assesses, acquires, and allocates necessary resources to the most effective and efficient use. And it's a plan that anticipates and incorporates competitor responses. Peter Drucker, the great 20th-century management thinker, observed that there are two types of thinking: thinking about objects and thinking about people. Static thinking involves planning around objects and is quite easy; the variables are few and relatively unchanging. Strategic thinking, however, is much more difficult, because it involves anticipating the actions and reactions of competitors and preparing accordingly. Thinking strategically helps us to make sense out of chaos and enables us to use the forces around us to our advantage, rather than allow those forces to pummel us. We learn to quarterback our own lives, both by planning ahead and by adapting our plan in the moments of decision that matter most. Strategic thinking skills are most critical in the moments when an outcome is uncertain and additional strategic action is needed. This is the quarterback in the seconds before the snap, the courtroom attorney in a last-minute maneuver, the closing minutes on a stock-exchange trading floor, or the perfect teaching moment with a child. 9 In this course, we will cultivate the benefits of strategic thinking, enabling us to enjoy increased productivity and work satisfaction, greater predictability, less stress, greater efficiency, and a better chance of victory. Suggested Reading Dixit and Nalebuff, Thinking Strategically: The Competitive Edge in Business, Politics, and Everyday Life. Harvard Business School Press, Thinking Strategically. Porter, "What Is Strategy?" Rice, Three Moves Ahead. Sloan, Learning to Think Strategically. Questions to Consider Lecture 1: The World of Strategic Thinking 1. Strategy is one of the most used—and abused—terms in the lexicon of modern business. This is largely because genuine strategy is so difficult to craft, risky to accept, and challenging to implement; as a result, poseurs, such as off-the-shelf "efficiency tools," masquerade as strategy. What are some of the programs and processes you know of that position themselves as "strategy" and how do they differ from genuine strategy? 2. Use the game of football as a learning tool. Watch a football game with an eye toward observing specific players on the field; watch their actions and where they look before each play. Do they attempt to deceive their opponents? Watch the quarterback and consider his actions after he breaks the huddle. What does he do? What are his thoughts? How does he react to what he sees? 3. Ensure that you understand the difference between strategy and a mere off-the-shelf efficiency tool or efficiency process. What is the difference and why do you think that efficiency tools so successfully masquerade as strategy? 10 The Origins and Relevance of Ancient Strategy Lecture 2 P hilosophers and generals study the great thinkers of the past, and we would do well to emulate them if we wish to deepen our understanding of strategic thinking in the 21st century. The broader our context, the more elaborate our backdrop, the more useful the tools of strategy become. In this lecture, we'll learn strategic lessons from six of the best military commanders and thinkers in history; as we do, try to come up with ways that these lessons can be relevant in your own life and work. Thucydides Thucydides was a 5th-century-B.C. aristocrat who served as a general in the Peloponnesian War, the great conflict between the Greek citystates of Athens and Sparta. Thucydides carried the rank of strategos, or general, and his History of the Peloponnesian War covers the conflict down to the year 411 B.C. Nearly 2500 years after it was written, this ancient treatise serves as the starting point for the field of international relations, the foundation for a school of thought called political realism, and our earliest account of strategic thinking in action. The work of Thucydides conveys skepticism about such concepts as justice. For example, in the famous Melian dialogue, the Athenians assert their superior armed might as the only arbiter required to exact cooperation from the inhabitants of the island of Melos. The passage sweeps away notions of fairness, justice, reason, and even intervention by the gods. The Melian dialogue presents us with an archetype for power politics or realpolitik. Think of a situation in which power remains paramount in your professional life. Is there a market or competitive field where overwhelming force or vicious competition is not only the most 11 effective strategy but also the only logical one? How can you leverage your organization's advantages to score an overwhelming victory? Pagondas Despite the fact that the generals of Athens were called strategos, they didn't use a great deal of actual strategy in the Peloponnesian War. To see strategy at work in this war, we must look at an apparently insignificant battle that featured none of the leading generals from either side. On the surface, the Battle of Delium, fought in 424 B.C., looks like just another ancient bloodletting. But at Delium, an obscure Theban general named Pagondas exhibited a radically new mode of combat. Lecture 2: The Origins and Relevance of Ancient Strategy At the start of the battle, the Athenians marched out to the valley near Delium with about 20,000 troops, but they turned back after their supporting troops failed to appear. Rather than allow the Athenians to flee, Pagondas urged the Thebans to pursue and close with them. With this move, he developed the principles of forward defense and preemption—striking an enemy that poses a long-term threat rather than an immediate threat. At a crucial moment in the battle, Pagondas ordered fresh companies of Theban cavalry, held in reserve, to attack the Athenians in concert with the infantry. This was the first recorded use of deliberate reserves joining an attack. In response, the Athenians panicked; their ranks shattered; and they fled. Among the innovations Pagondas introduced in this battle was his own monitoring of the situation from a distance—rather than positioning himself at the forefront of the fighting—and the modification of troop formation. The Battle of Delium counts as the birthplace of a science of Western tactics and gives us our second strategic lesson: Surprise innovations can often turn the tide of an evenly matched struggle. In your life, are you stuck fighting a battle with traditional tactics? If so, can you think of any innovations that will allow you to catch your opponent off guard? 12 Sun Tzu China offers us one of the most well-known examples of strategic theory, The Art of War, popularly attributed to Sun Tzu, a general who flourished in the 5th century B.C. This work was perhaps expanded by others in subsequent centuries, and it greatly influenced military thinking in Asia and, later, the West. Sun Tzu's brilliance lay in his recognition of the fluid nature of reality and the fact that any practitioner of strategy must constantly adapt to that reality. Sun Tzu's principles can be applied to the battlefield, public administration and planning, and diplomacy and international negotiation. Key to Sun Tzu's thinking is his realization that all plans are temporary. He knew that a plan can become obsolete as soon as it's crafted. For him, the decision to position one's forces in competition depends on two major factors: (1) objective conditions in the physical environment and (2) the subjective beliefs of competitors in that environment. In this, Sun Tzu originates a view shared by elite strategic theorists down to the present: that the most brilliant plans are those that spring into being in the dynamic of action and response. Sun Tzu believed that strategy requires rapid responses to changing conditions based on sound judgment and principles. How can you apply Sun Tzu's lessons in your life? Consider situations in which you rely on outdated plans; then think like Sun Tzu: Figure out how and why your plans went awry and how that understanding can help you correct course. Hannibal Barca Hannibal was a Carthaginian general who plagued the Roman Republic from the 3rd century into the 2nd century B.C. Outnumbered in the enemy's homeland, he fought the Romans to a great victory in 216 B.C. at the Battle of Cannae, thanks to his revolutionary manipulation of forces. 13 © Photos.com/Thinkstock. Lecture 2: The Origins and Relevance of Ancient Strategy At the Battle of Cannae in 216 B.C., the Carthaginian general Hannibal outmaneuvered and outsmarted the Romans with a battle plan that turned their own tactics against them. In Hannibal's time, standard tactics dictated that formations of soldiers would line up abreast of each other in a phalanx, march forward, collide, and do battle. Numerical superiority was thought to be the key to victory. Armed with fewer resources than his Roman enemies, however, Hannibal configured his forces differently and achieved a stunning success. At Cannae, the Romans marched forward in a narrow and deep phalanx that matched the front of Hannibal's smaller force. This narrow front greatly negated the Roman numerical advantage. Roman training dictated that soldiers pursue a fleeing opponent. Thus, when Hannibal's leading troops appeared to break and withdraw, the Romans pressed forward, leaving their flanks to Hannibal's infantry. The Romans were also taken unawares by a change in cavalry tactics. Once Hannibal's cavalry had driven off the Roman cavalry, his horsemen did not pursue the Romans. Instead, they fell upon the rear of the masses of Roman 14 infantry, which became even more tightly packed. The envelopment of the Romans was complete, and their destruction, inevitable. Hannibal achieved this great victory not with superior numbers but superior strategy and extraordinary tactical execution. And that's his lesson to us: When faced with superior competitors, use your knowledge of their habits and weaknesses to outsmart them. How can you invert commonplace thinking and outmaneuver your competitors when they're falsely feeling confident? Vegetius Vegetius was a Roman administrator who lived in the late 4th century A.D., during a period of Roman decline. At the request of Emperor Valentinian, Vegetius prepared a treatise called Epitoma rei militaris, or A Summary of Military Matters, which became the most popular military handbook for more than 1000 years after its publication. The Summary contains a list of seemingly pedestrian topics—the selection of recruits, their training, and so on. The link to high-concept strategy here is that strategy encompasses three elements: intentions, capabilities, and resources. Vegetius's work addresses how the military may develop its capabilities to achieve the aims of strategy. Throughout his work, Vegetius hammers home the need for thorough training, strong discipline, hard work, and sound planning. These elements of preparation form the heart of strategic capability. Key among his directives was an emphasis on the need for, and uses of, strategic reserves. As an exercise, write out all the areas where you feel your company has uncommonly strong reserves. Where can you hold off deploying all your resources to lure your competitors into a false sense of confidence? How can you spring these resources on the competitor suddenly and with overwhelming effect? Machiavelli In his famous work The Prince, Niccolò Machiavelli, one of the most important political theorists in history, advocated a coldly reasoned 15 line of behavior to maintain a monarch in power: a ruthless pursuit of self-interest. In the lesser-known Art of War, Machiavelli extended this amoral reasoning to the battlefield. Machiavelli offers us two key concepts: virtu and fortuna, representing Lecture 2: The Origins and Relevance of Ancient Strategy the internal and external elements of strategic thinking. o The concept of virtu for Machiavelli incorporates numerous qualities: flexibility, foresight, individuality, ability, energy, political acumen, prowess, and vital force. It is a skill that one can develop and sharpen. o Conventional thinkers of the time treated Fortuna as a mostly benign goddess. In contrast, Machiavelli conceived fortune as a malevolent and uncompromising source of human misery and disaster. Thus, he counseled generals to "beat and maul" fortune into submission. Today, we would call his advice a bias toward action. o Virtu provides the ability to respond to fortune at any time and in any way necessary. This joining of the actor with the environment is an early formulation of the concept of emergent strategy. Given that we cannot predict what Fortuna will hand to us, we must develop the internal qualities and capabilities that enable us to meet those uncertainties in the best manner possible. As a final challenge for this lecture, ask yourself whether you have developed the flexibility, foresight, and energy to outwit unpredictable fortune. Think back to an unexpected situation that overwhelmed you in the past. Have you learned from it, and if not, how can you? The Lessons of the Past Ancient strategists provide us with modes of thinking and practical guidance that we can use in the present. First, any area, no matter how dominated by thoughtless effort, can be transformed by the application of tactics. Try to use special forces at special times and in special ways. 16 Second, understand that plans must change. Learn to recognize the fluid nature of reality and be aware that any strategy must constantly adapt to that reality. The most brilliant plans are those that spring into being in the action-response dynamic of the moment. Third, preparation is the heart of strategic capability. Whether you're running a household or a billion-dollar business, training, discipline, hard work, and sound planning are the foundations of strategic reserves, which are necessary for many kinds of maneuvers. If you have no reserves, you have no strategy. Fourth, know your opponents. You can gain astonishing leverage if you know the preparations and capabilities of your opponents. A combination of surprise and superb tactical execution can allow you to defeat an opponent with twice your strength. Fifth, be bold; seize your fortune. The greatest challenge in strategic thinking is getting started. Names to Know Hannibal (247 B.C.–183–181 B.C.): Son of a famous general and sworn to eternal hostility against Rome from a young age, Hannibal Barca's name will always be associated with one of the greatest victories in all of history: his defeat of the Romans at Cannae. Machiavelli, Niccolò (1469–1527): A humanely educated man who is most remembered for his tract on political power, Machiavelli also offered his take on conflict in his treatise The Art of War. Literally a Renaissance man, Machiavelli collaborated on military projects with both Leonardo da Vinci and Michelangelo. Pagondas (fl. 5th century B.C.): This obscure Theban general is credited with inventing the science of battlefield tactics, demonstrating a radical new approach to warfare of the time by his innovations at the Battle of Delium (424 B.C.) during the Peloponnesian War. 17 Sun Tzu (fl. 5th century B.C.): One of a handful of almost universally known strategists, the impact of Sun Tzu on strategy and the way we think about strategy has suffused thinking not only in present-day military circles but in business and political realms, as well. Descriptions of warfare in The Art of War, traditionally credited to Sun Tzu, suggest that the work was composed early in the Warring States period (475–221 B.C.). Famous generals who utilized Sun Tzu's principles were Chinese communist Mao Zedong, Vietnamese general Vo Nguyen Giap, and American generals Norman Schwarzkopf and Colin Powell in the First Gulf War of 1991. Lecture 2: The Origins and Relevance of Ancient Strategy Thucydides (460 B.C. or earlier–after 404 B.C.): This ancient Greek historian is the founding father of the modern political science school of realism, which sees the international system as resulting from configurations of state power. Carrying the rank of strategos in the Athenian military, he both fought in the Peloponnesian War and wrote about it. Vegetius (fl. 4th century A.D.): The avatar of adequate training and preparation of military forces, Vegetius preached the necessity of proper development of superior military capability prior to battle. He wrote his treatise Epitoma rei militaris at the request of Emperor Valentinian, divining how the "ancient Romans" organized and utilized their legions so that Rome's military prowess might be resuscitated. Suggested Reading Hanson, Ripples of Battle. Jay, Management and Machiavelli. Koliopoulos and Platias, Thucydides on Strategy. Machiavelli, The Art of War. Thucydides, The Peloponnesian War. 18 Questions to Consider 1. In your own personal or professional life, what is a situation where power remains paramount? Thinking about your own situation, what advice might you give the Athenians or the Melians? 2. Think of a way that you or your associates are stuck using traditional tactics. Recalling how General Pagondas outmaneuvered the Athenians, try to think of a completely new way to behave that might catch a competitor or opponent you face off guard. 3. Considering the action-response dynamic that infuses Sun Tzu's writings, resolve to replace at least one way that you are merely working through an established list or procedure with a more deeply considered response to the circumstances you actually face. 4. Survey competitors or potential competitors in your environment. Do they have quirks or weaknesses that you know about? How might you, like Hannibal, exploit such knowledge to outmaneuver them when they're falsely feeling most confident? 5. Write out all areas where you, your workplace, or another organization you care about has uncommonly strong reserves. Where can you hold off deploying all those resources? How might you spring those resources on a competitor suddenly and with overwhelming effect? 6. Consider your own approach to good and bad fortune. Think back to an unexpected situation that overwhelmed you in the past. What have you learned from it? What personal traits could you cultivate in order to handle similar situations more effectively in the future? 19 The Dawn of Modern Strategic Thinking Lecture 3 T he study of early-modern military strategy enables us to discover deep lessons of how strategy emerges, how it comes to terms with the environment, and how it can help us achieve our goals. Napoleon himself urged careful study of the great military strategists as the surest way to become a great captain. Thus, in this lecture, we examine the contributions of Napoleon, Clausewitz, Jomini, and the geopoliticians. Lecture 3: The Dawn of Modern Strategic Thinking The Enlightenment and Strategic Thinking Beginning in the 17th century, the Enlightenment mobilized the power of reason to reform society and advance knowledge across numerous fields—science, politics, medicine, education, and war. Inevitably, the Enlightenment emphasis on reason and its exploration of the fundamentals of social life would prompt new thinking about war. The 18th-century works of the French general Maurice de Saxe and Frederick the Great began to outline the battle principles that would lay the groundwork for Napoleon. Saxe revived and extended the Roman insights transmitted by Vegetius. Frederick the Great's most important achievement came in the ability to drill large numbers of troops effectively. The ascension of Napoleon marks the dawn of the modern era of strategic thinking. All of the elements for a military strategic revolution were present: new thinking, new technologies, and increasing populations. Napoleon Studying Napoleon enables us to discover deep lessons in how strategy has developed from its ancient forms, how it has come to terms with an environment that changes constantly, and how it can confer competitive advantage in the goals we pursue. Napoleon himself urged careful study of generals from the past. 20 The Napoleonic era stretched roughly from 1790 to 1815. Napoleon declared himself emperor in 1804, and he became, for a time, the master of continental Europe, achieving military victories over a series of European coalitions. Napoleon exemplifies strategic thinking in that he demonstrates the power of ideas over material resources. Napoleon's insights into strategic thinking and other topics are distilled in a volume called The Military Maxims of Napoleon. These serve even today as a practical guide to how a great strategic mind approaches tactical problems and weaves their solution into a coherent whole. Napoleon recognized that some people view strategy as a checklist of techniques. The unspoken In Napoleon, the elements for a revolution in military assumption here is that if you learn strategy came together the techniques, then you, too, can be in a "perfect storm." a great general. This is possibly the greatest danger for us as strategic thinkers today: to think of strategy as a formula. On this point, Napoleon said, "Unhappy the general who comes on the field of battle with a system." He also understood the paradox that the best strategy can be overturned by its very implementation. He said, "In war, theory is all right so far as general principles are concerned; but in reducing general principles to practice there will always be danger." The key, instead, is to retain flexibility and cultivate the skill of responding to an opponent's actions. 21 © Photos.com/Thinkstock. Lecture 3: The Dawn of Modern Strategic Thinking The Strategies of Central Position and Indirect Approach Napoleon used the strategies of central position and indirect approach throughout his campaigns in the early 19th century. Which strategy he chose depended on such factors as terrain, weather, troop numbers, and overall capabilities as he judged them. When Napoleon was outnumbered, he would use the central position strategy, maneuvering his army to a position between the coalition armies facing him and driving a wedge between them. He would then seek battle with one army while leaving a masking force to hold the second in place. This maneuver was the expression of Napoleon's almost maniacal devotion to the principle of concentration in time and space. The idea here is that when you attack, you mount a preponderance of force at the point of attack, even if you are outnumbered overall. When Napoleon had strength comparable to his opponents and room to maneuver, he would use the strategy of indirect approach. This involved positioning a small force to the front of the enemy to feign a major attack. Simultaneously, the main force would march to the enemy's flanks or rear, placing Napoleon's troops on the enemy's lines of communication and supply and forcing the enemy to fight at a disadvantage or withdraw. Antoine Jomini Napoleon is tightly bound up with the names of the two most influential military theorists of the 19th century, Antoine Jomini and Carl von Clausewitz. Both offered powerful interpretations of the Napoleonic Wars, and they influence the making and implementation of strategy even today. 22 Jomini was a Swiss citizen and an officer in Napoleon's Grand Armée. He rose to prominence by his writing on military matters, and his Art of War is the work often credited with being the first to define strategy, tactics, and logistics as three distinct realms. Of these, defining the overall principles of strategy was his primary concern. According to Jomini, the fundamental principle of strategy was concentration, specifically, concentration of forces at the decisive point on the battlefield. This concentration consisted of four interrelated elements. o The first element involves bringing the majority of forces to bear on the decisive areas of a theater of war and the enemy's communications, without compromising your own. In modern-day business, this might equate to bringing resources to bear on a single critical part of the competitive market. o The second element is maneuvering to engage major forces against only parts of the enemy's forces. o The third element is using tactical maneuvers to bring major forces to bear on the decisive area of the battlefield that it is important to overwhelm. o Finally, the fourth element is to ensure that these forces at the decisive location are put into action quickly. In other words, it isn't enough to concentrate your resources at a critical place and time; your organizational control must be such that you can deploy those resources to achieve your goal. In addition to the principle of concentration, Jomini brought geometric precision to strategy and tactics, developing 12 geometric orders of battle, or specific geometric formations to engage an enemy. Carl von Clausewitz Clausewitz was a Prussian officer whose posthumously published On War remains an influential treatise on strategy. He positioned war in a larger context, demonstrating the connections between the military and political spheres. Clausewitz viewed conflict as a function of three variables: violence, chance, and political aims. It was the job of the strategist to balance these three to achieve victory. 23 Of the three, the variable with the most relevance for us as strategic thinkers is the element of chance—the interplay of the military commander's courage, talent, and skill with the capabilities at his disposal. In the furor of battle, Clausewitz believed that the commander's insight—what he called coup d'oeil ("glance of the eye," lightning insight)—in the face of chance was the key to victory. Military establishments today recognize the importance of intuition in battle, and the latest research suggests that intuitive decision making can be taught. Lecture 3: The Dawn of Modern Strategic Thinking The Influence of Jomini and Clausewitz The impact of Jomini was seen in the latter 19th century, while Clausewitz achieved greater prominence in the 20th century. In the American Civil War, Jomini's influence inspired the tactics of massed frontal infantry assaults on both sides that led to massive casualties. But the fault is not Jomini's; rather, it is the commanders who thought of strategy in terms of a checklist. The Civil War also yielded several practitioners who appeared ahead of their time in their creativity and ability to adapt to fluid and chaotic situations. They recognized the futility of massed infantry assaults against an entrenched enemy armed with long-range rifles and minié balls. 24 o The Southern general Stonewall Jackson believed in maneuver and surprise as powerful weapons, not just enhancements of the "real business" of making war. His Shenandoah campaign of 1862 was a brilliant demonstration of the power of feint, deception, and speed of maneuver as force multipliers. o Nathan Bedford Forrest, another Southern general, summed up his own strategic theory with the aphorism "Get there first with the most." This short phrase encompasses a core of strategic theory that includes surprise, maneuver, objective, speed, capabilities, and mass. Forrest's 1864 victory over a Union force at the Battle of Brice's Crossroads exemplified Jominian principles, particularly that of concentration. o Much later, in the Second World War, General Heinz Guderian led Hitler's panzers across Belgium and France following the same principle as Forrest: applying overwhelming force at a single point and then pursuing an enemy relentlessly. World War I was the most horrific cauldron of war and death the world had known to that point. Military strategists of the time attempted to concentrate their forces as prescribed by Jomini, but they failed to recognize that technology had shifted the advantage to the defense. The horrors of World War I led to a rethinking of strategy. The prominent military thinker Basil Liddell Hart concluded that the frontal assault had limited utility; instead, he advocated his own theory of indirect approach that took into account the new weapons introduced in World War I, particularly the armored tank. In the 1930s, other strategic theories emerged as responses to changing political and technological conditions. One of the most notorious of these was the field of geopolitics and its insight known as geographical determinism: Geography determines the destinies of states and the fate of men. o One of the most famous dictums of geopolitics was formulated by Sir Halford Mackinder in 1904, and it is ominous in what it portends: "Who rules Eastern Europe, commands the Heartland. Who rules the Heartland, commands the World Island. Who rules the World Island, commands the World." o Geopolitics was adopted by Nazi Germany as a pseudoscientific justification for German expansion, but today, the field has made a comeback. 25 Takeaway Points from Early Military Strategists The two tools worth remembering from these early military strategists are the indirect approach and the strategy of the central position. But we must also learn how and when to use such tools. For instance, the frontal assault is used far too often. Strategic thinking requires much more than memorization of principles; it requires you to develop a keen and agile mind that is capable of independent and responsive thought. Names to Know Lecture 3: The Dawn of Modern Strategic Thinking Bonaparte, Napoleon (1769–1821): Once master of continental Europe, Napoleon is best remembered for a departure from his normally crisp execution of strategy when he failed to mask his flank and rear at the battle whose name is synonymous with defeat—Waterloo. Yet his legacy also extends to this day in the realms of the civil law tradition, modern civil government bureaucracies, and military theory and practice. Clausewitz, Carl von (1780–1831): The way we think about war and strategy cannot be divorced from this 19th-century officer and theorist, who revolutionized strategy in the same way that Adam Smith revolutionized economics. He fought in the Napoleonic Wars for both the Prussians and the Russians and participated in the battles of Waterloo and Borodino. He died in 1831, and it was left to his widow, Marie, to prepare his manuscript On War for posthumous publication. Guderian, Heinz (1888–1954): A great theorist and practitioner of the art of swift tank warfare, Guderian's elan and mastery of the battlefield were rivaled only by the great Erwin Rommel. Jackson, Thomas (Stonewall; 1824–1863): Ahead of his time with regard to battlefield tactics, General Jackson's motto during the American Civil War was to "mystify, mislead, and surprise" the enemy. Jomini, Antoine (1779–1869): Theorist and general, Jomini authored the bible of 19th-century military strategy and influenced the world's militaries 26 of that era more than any other individual theorist. He is distinguished by his effort to apply geometrical concepts to the battlefield. Mackinder, Sir Halford (1861–1947): A geographer by trade, Mackinder is forever linked to efforts to create a social science of geopolitics by dint of his famous formula for achieving world domination that appeared in a pivotal article in 1904. Suggested Reading Buskirk, Modern Management and Machiavelli. Chandler, The Military Maxims of Napoleon. Clausewitz, On War. Gray, Modern Strategy. Jomini, The Art of War. Liddell Hart, Great Captains Unveiled. ———, Strategy. Von Ghyczy, Von Oetinger, and Bassbord, Clausewitz on Strategy. Questions to Consider 1. Napoleon's maxims yield surprising insights that transcend the battlefield, and this is doubtless because he was an able administrator and shrewd politician, as well as a superior battlefield general. His preparedness maxim bears consideration and suggests strongly to us that we should assess our strategic position periodically to gauge our readiness to withstand the most likely challenge. Are you prepared for the battlefield? 2. Napoleon's strategy of the central position offers a practical guide to conflict situations in our daily lives that involve two or more allies teaming up against us. The fundamental idea is to concentrate our power in both time and space against only a portion of the opposing strength. 27 In this way, you can take on opponents who may seem more powerful. Is there a situation in your personal or professional life that is suited to Napoleon's central position strategy? 3. Napoleon's strategy of indirect approach gives us a method to grapple with a foe who is our equal. Rather than attack his or her strength, we approach on an oblique, sometimes feigning a frontal assault with a "demonstration." Companies can do this quite well, just as armies do, approaching opponents from an unlikely direction while leading them to believe that we're approaching exactly where they expect. Identify an oblique approach you might use to challenge one of your competitors. 4. Antoine Jomini attempted to establish "best practices" for the military Lecture 3: The Dawn of Modern Strategic Thinking of his time by demystifying the Napoleonic Wars for his readers. Using best practices is a modern business goal that propels businesses to the frontiers of efficiency. Doing so is not strategy, but it is absolutely essential to success. Do you engage in the best practices of your profession? Are you pursuing best practices in your dealings with others, in the systems that support your daily life? 5. Clausewitz placed great stock in the notion of the general's coup d'oeil, or battlefield intuition. Each of us can develop our judgment and decision-making abilities, but coup d'oeil means going beyond basic analysis and listening to our intuition. Has there been a time in your life when your intuition or a "hunch" provided you with the needed solution to a problem? If so, analyze where that insight came from and cultivate the habit of listening to your intuition rather than suppressing it. 28 Modern Principles of Strategic Conflict Lecture 4 T he hallmark of a sound principle is its successful application, across time and circumstances. In situations of competition and conflict, the principles of war that we'll look at in this lecture offer us guiding ideas for executing any strategy against a determined opponent. In the effort to learn how to think strategically, the principles of conflict are a valuable tool. France, Spring 1940 In the spring of 1940, the French, safely behind their impregnable Maginot Line, believed they were ready for a German attack. But the line left a small portion of the Belgian border unprotected, especially the area covered by the dense Forest of Ardennes. The French thought the Ardennes would deter the Germans from attacking in that region. The Germans, however, had no intention of grinding their army against the French Maginot Line. Instead, they attacked through the Ardennes and, in doing so, achieved that rarity in modern warfare: strategic surprise. The Germans combined two strategic principles: (1) the assembly of activities in innovative ways and (2) the indirect approach. They launched what became known as blitzkrieg, or lightning war, combining the use of tanks, aircraft, and infantry, and they swung around the French defenses, invading Belgium and, ultimately, cutting the Maginot Line off from the rest of France. In delivering the knockout blow to France, the Germans used an assortment of tactical principles of war to realize their strategic intent: offensive, mass, maneuver, economy of force, and surprise. The hallmark of a sound principle is its successful application, across time and in situations in which the technology, place, and combatants may change, but the principle holds true. Let's now turn to a set of principles of 29 war distilled by the British colonel John Frederick Charles Fuller during World War I and adopted (in slightly different form) by the U.S. military. Lecture 4: Modern Principles of Strategic Conflict Principles of War Objective: Direct every military operation toward a clearly defined, decisive, and attainable objective. Offensive: Seize, retain, and exploit the initiative. Mass: Mass the effects of overwhelming combat power at the decisive place and time. Economy of force: Employ all combat power available in the most effective way possible; allocate minimum essential combat power to secondary efforts. Maneuver: Place the enemy in a position of disadvantage through the flexible application of combat power. Unity of command: For every objective, seek unity of command and unity of effort. Security: Never permit the enemy to acquire unexpected advantage. Surprise: Strike the enemy at a time or place or in a manner for which it is unprepared. Simplicity: Prepare clear, uncomplicated plans and concise orders to ensure thorough understanding. Objective The ultimate military purpose of war is the destruction of the enemy's armed forces and will to fight. Of course, the ultimate objectives of operations other than war are considerably less destructive; nevertheless, it's important to have a clear objective or mission. 30 This objective must be clear to everyone who has anything to do with the planning and execution of operations. At the personal level, we must be clear in our ultimate objective; it must inform and guide our use of all the principles. Too often, we get bogged down in the minutiae of the task, confusing tactics with the goal. History is replete with master tacticians who were unable to connect to the larger strategic picture. Even Robert E. Lee has been faulted as being a master tactician but a mediocre strategist. Any operation must have a purpose, and that purpose must be clear from the beginning. Each operation must contribute to the ultimate strategic aim. The attainment of intermediate objectives must directly, quickly, and economically contribute to the operation. The army uses an analytical framework of mission, enemy, troops, terrain, and time available (METT-T) to guide it in rapid development of its operations. Commanders designate physical objectives, such as an enemy force, dominating terrain, or other vital areas essential to the mission. These then become the basis for all subordinate plans, and no action is taken that doesn't contribute to achieving the main objective. Likewise, in your own strategic planning, the mission or objective must dominate and condition your thinking and actions. To adapt the military framework, think of the "enemy" as a competitor, your "troops" as your employees or your own energy and resources, and the "terrain" as the organizational landscape in which you maneuver. Offensive The second principle of competition tells us that offensive action is the best way to attain an objective. Such action is effective and decisive. Offensive action is how we seize and hold the initiative while we maintain our freedom of action. In war, sports, business, and politics, this is fundamentally true across all levels of operations. We "play defense" only as a temporary necessity and only as a respite before we can seize the initiative and continue our offensive actions. 31 The reason for this should be clear: The side that retains the initiative through offensive action forces competitors to react rather than allowing them to act. Lecture 4: Modern Principles of Strategic Conflict Mass Mass is the synchronization of combat power in concentrated time and space on the enemy. In everyday terms, the idea is to deliver a massive blow to your competitor. Applying this principle is not as easy or as intuitive for some people as it may seem. Synchronizing the many moving parts of a large organization is difficult in the best of circumstances. Moreover, in situations other than war, we may seek less of a massive battle and more of an accommodation. Nonetheless, when the decision is made to join the battle, this principle suggests that we mass our resources for a decisive engagement. We must also sustain our massed resources and our attack so that the effects have staying power. Economy of Force Because the mass we have is never unlimited, we also need economy of force. We must deploy and distribute our resources so that no part is left without a goal to accomplish. In military operations, combat power is finite and must be used judiciously. It is allocated to various tasks in measured degree—limited attacks, defense, delays, deception, or even withdrawal operations. All of these must be carefully measured so that we can achieve mass elsewhere at the decisive point and time on the battlefield. In business, we must be likewise judicious and not squander our resources in peripheral ventures. 32 Maneuver The principle of maneuver enables us to go after bigger prizes. In competition, we want to position ourselves for maximum advantage. How this advantage is measured varies according to the enterprise. For instance, you might be maneuvering against other job-seekers, other mid-level executives, or other candidates in a political race. Maneuver is the movement of forces in relation to the enemy to gain positional advantage. Effective maneuvering keeps the enemy off balance and is used to exploit successes, to preserve our own freedom of action, and to reduce vulnerability. Prudent and vigorous maneuvering continually poses new problems for the enemy. It renders the enemy's actions ineffective and can eventually lead to defeat. At all levels of operations, successful application of maneuver requires agility of thought, plans, and organization. It's also necessary for us to apply the previous principles of mass and economy of force. Our ability to maneuver is how we can determine where and when to join the fight, by setting the terms of battle, by declining battle, or by acting to seize unexpected tactical advantage. By maneuvering with skill, we can make ourselves unpredictable and, thereby, raise uncertainty and hesitation in the minds of our competitors. Unity of Command Responsibility is a totem that many people pay homage to but honor only when absolutely necessary. In fact, diffusion of responsibility and closed-door decision making seem to be characteristic of modern corporate America. But in arenas of conflict, responsibility cannot be abdicated. Unity of command and unity of effort are required if the objective is to be reached. 33 In the military, unity of command means that all forces are under one commander who has the authority to direct them in pursuit of a unified purpose. Unity of effort, on the other hand, requires coordination and cooperation among all forces—even though they may not necessarily be part of the same command structure—toward a commonly recognized objective. Unity of command is an ideal that shortens response time and leads to rapid decision making and execution, but it is not always attainable; this is why unity of effort becomes paramount. Lecture 4: Modern Principles of Strategic Conflict Security Security is a precondition for unity of effort. To protect our position from competitor encroachments, it's necessary to recognize that we can't make plans and execute them without considering our competitors' actions. We have to protect our own resources, market share, goal line, operations, and personnel. The security of our plans and capabilities enhances our freedom of action by reducing risk. Active security reduces our vulnerability to hostile acts, influence, or surprise. If we know and understand our competitors' strategy, tactics, doctrine, and staff planning, if we can anticipate their likely courses of action, then we can take adequate security measures. Surprise Surprise, if achieved at the strategic level, can bestow such incredible advantage on one side that it settles any outstanding question. In conflict, surprise stands as a force multiplier. It follows that you want to surprise your opponents, and you want to do so as often as possible to keep them off balance and interfere with their plans. Surprise can be achieved through speed, effective intelligence, deception, application of unexpected force, operations security, and variations in tactics and methods of operation. 34 Simplicity Pulling all these principles together is the principle of simplicity. The simpler the plan, the better the chances of executing it successfully. This is especially true in large organizations or with complex projects. In the corporate world, it is the simple and direct strategy with simple execution that best marshals the resources and spirit of the firm. Simple plans and clear, concise orders minimize misunderstanding and confusion. Simplicity in plans allows better understanding and leadership at all echelons and permits branches and sequels to be more easily understood and executed. Summarizing the Principles John Fuller, the British officer who first enunciated these nine principles, suggested that they can be remembered by grouping them under three headings: control, pressure, and resistance. If we remove these principles from the venue of war and consider them simply as methods for dealing with a pesky adversary or aggressive competitor, their universal applicability becomes more apparent. As we'll see in lectures to come, these principles make a valuable contribution to the effort to think strategically—to exert a measure of control over a chaotic and sometimes hostile world. Suggested Reading Alger, The Quest for Victory. Buskirk, Frontal Attack. Foch, Principles of War. Ries and Trout, Marketing Warfare. 35 Questions to Consider 1. Consider how, in 1940, the French erred as a result of military thinking rooted in World War I. Are your own ideas the product of older experiences, perhaps no longer relevant to the modern challenges you face today? Do an "idea inventory" to see if your conception of how the world works measures up to 21st-century dynamics. 2. Before considering the principles of conflict in this lecture, honestly assess the principles that guide your thinking now. Are they successful? Do you find yourself constantly outmaneuvered at work, in sports, in your personal life? 3. Choose any three principles of conflict and consider whether they have been used against you recently. You should be able to recognize maneuvers for what they are and, with a bit of preparation, guard against them with the principle of security. 4. Choose any three principles of conflict and apply them to a situation Lecture 4: Modern Principles of Strategic Conflict you face in your daily life. Consider whether the application of these principles might improve your chances of success. 36 Geography—Know Your Terrain Lecture 5 M any of the finest thinkers in history have, at various times, discovered geography's enduring impact on the fate of peoples and nations. If geography is immutable, then can we uncover modes of behavior that take advantage of geographical verities? In this lecture, we delve into the influence of micro-geography on our own decision making to discover how our interactions with our physical space in conflict situations can aid or detract from our chances of victory. Geopolitics Geopolitics is a body of systematized thinking about the effects of geography on human politics and conflict. Its premise is that the unchanging characteristics of the physical world in which we live condition human behavior and interactions. In this view, geography has a decisive impact on the interests and actions of nations and peoples. The field is sometimes derided as "geographic determinism," meaning that it seeks a single-factor explanation for complex phenomena. Geopolitics also had an unfortunate association with the Nazi aspirations of Adolf Hitler. Today, the core idea of geopolitics is that geography is an important source of political, military, and economic power. Geopolitical notions have leavened our way of thinking for years, and some geopolitical truisms have seeped into our discourse. For instance, the development of the American democracy is sometimes explained as a result of the two ocean barriers that shielded the young nation from the depredations of more entrenched European models. Geopolitics has even given us "laws" or "maxims" that purport to instruct us on the fundamental effects imposed on humans by geography. According to the geopolitical theorist Nicholas Spykman, "Geography is the most fundamental factor in the foreign policy of states because it 37 is the most permanent. Ministers come and ministers go, even dictators die, but mountain ranges stand unperturbed." Geography not only matters in the grand sweep of politics, but it also affects us in phenomena closer to home. Further, minor geographical features that may seem inconsequential in isolation can take on tremendous importance as events unfold. The sunken road of Ohain, for example, proved to be disastrous for Napoleon's cavalry at Waterloo. Lecture 5: Geography—Know Your Terrain Inherent Positional Power Geography is not important in and of itself. It takes on importance only as human beings and machines use it to a purpose, and its value is usually temporary. In competition, the interaction among opponents and the battlefield takes on the character of a three-way dialectic. Opponents maneuver against each other as they interact with the battlefield. Locations on the battlefield take their significance for the moment with respect to the deployment of forces. This is the process of maneuver, or positioning. The geography of every battlefield has inherent positional power, whether that battlefield is the field at Waterloo or the office conference room. This inherent positional power arises from the principles of competition that dictate the terms of engagement on the battlefield. Of course, the positional power inherent in a battlefield would vary tremendously based on a different rule structure. Strategy would change, as well. For example, changing the geographical position of the goal in a football game would alter both the strategies of the opposing teams and the positional power on the field. The football example gives us two notions of power as it springs from geography: potential positional power and realized positional power. Potential power springs from the investment in the battlefield of the technology and tactics available to both sides. Realized power springs from the actual deployment of forces, their condition, their numerical strength, and the skill and timing of maneuver. 38 Positioning in Chess and Other Forms of Battle The game of chess teaches us about deployment of resources, coordination of attack and defense, the necessity of planning and constant evaluation, and the virtue of foresight. It also teaches us much about the critical factor of geography. The chessboard consists of 64 squares in an eight-by-eight arrangement, alternately colored black and white. Given the rules of chess and the resources we know will be deployed, the board offers us verities about the inherent positional power of certain areas of its geography. From the standpoint of pure potential power, the center four squares are the most important on the board, and the strategy of a winning game is based on seizing early control of those four central squares. But during the course of the game, the value of the squares changes with every change in the position of the pieces. Consider what happens when we add the pieces. As we've seen, the three-way interplay of the two combatants and their relationship to the field of battle is a complex dynamic. Pieces, of course, have a certain power inherent to their ability to move. The more versatile the movement of a piece, the more powerful it is. But a piece's power can be enhanced or limited by its location on the board. The pieces on the board in combat derive power from the configuration of their various locations. Conversely, the locations on the board fulfill their power potential from the overall configuration of the combatants. A type of synergy is in effect. The seating arrangement in a conference room is similar. It takes on significance from the purported rank of those sitting at the table. Assorted power configurations arise from different seating configurations. The shape of the table and the types of chairs also affect the configuration of power. In negotiation, the micro-geography and position of the venue can confer advantage, and we find some competitors attempting to alter 39 the terms of negotiation through physical alterations. For example, at P'anmunjŏm, the demilitarized zone between North and South Korea, such gamesmanship is the norm. A good example of the use of space in battle comes from the sport of boxing. Boxers in the ring maneuver against each other in space and time, using a repertoire of feints, punches, jabs, and so on. The space in the ring is finite and featureless, yet each square foot takes on significance vis-à-vis the interaction of the combatants. Lecture 5: Geography—Know Your Terrain Intelligence Preparation of the Battlefield The military has developed a systematic and sophisticated method for learning about and understanding the ground on which it is to fight. Its tool is called Intelligence Preparation of the Battlefield (IPB), and it's a process easily adaptable to our own challenges. In military scenarios, we know that the "high ground" confers advantages in principle. Conversely, we know that "taking the hill" is a daunting proposition. Rivers, valleys, and mountain ranges offer barriers to an enemy and to our own advance. The IPB process systematically assesses the information relevant to friend and foe on a particular battlefield. An intelligence officer collects and evaluates this information continuously and communicates it to the commander, who uses it to support decision making. IPB can be easily adapted for use in the business world and in personal decision making. The military's system formalizes and deepens a process that almost everyone conducts informally already. The broad lesson we take from IPB is the importance of geography in our own competitive situations. What potential sources of power are locked in the geography of the likely battlefield? How does geography potentially enhance or degrade strategy? Can you modify your strategy to take advantage of geography or to prevent it from degrading your strategy? 40 Steps in the IPB Process First, define the battlefield environment. Identify characteristics of the battlefield that influence both friendly and competitor operations. Establish the limits of the battlefield and identify elements that are unknown but should be known. Second, describe the battlefield's effects on operations. This step always includes an examination of terrain and weather but may also include the characteristics of geography and infrastructure and their effects on friendly and threat operations, as well as such factors as politics, civilian press, local population, and demographics. The third step is to evaluate the competitor. If the competitor is known, determine how it normally organizes for combat and conducts operations under similar circumstances. This information can be drawn from historical databases and well-developed threat models. With new or less well-known competitors, intelligence databases and threat courses of action may have to be developed simultaneously. Finally, determine the competitor's possible courses of action. The main question to be answered here is: Given what the competitor normally prefers to do and the effects of the specific environment in which it is operating, what are its likely objectives and courses of action? Defense in Depth One of the greatest examples of conducting and acting on IPB occurred during World War II. The major lesson of the example is how to respond if you know when and where you'll be attacked. There are several responses to a scenario like this, but the one chosen in this example was brilliant. We'll call it defense in depth. 41 Lecture 5: Geography—Know Your Terrain This technique was used by the Russians at the 1943 Battle of Kursk. At the time, the Russians held territory, centered on the town of Kursk, that bulged into the German front over an area 120 miles wide and 90 miles deep. In an attempt to cut off the Russian position, the Germans planned an attack from the north and south in a pincer movement. But the Russians knew of the attack well beforehand through their intelligence network. Over several months, they prepared successive defense lines, making use of the geography of the area to channel the German attack in directions to make them vulnerable. The Russians planned to slow and wear down the Germans by forcing them to attack through a web of minefields, planned artillery fire zones, and concealed antitank strong points. The German attack began to stall almost immediately after it started. The Russian defense was like a meat-grinder that chewed up the entire German strategic tank reserve in a week. The Germans never broke through, and the strategic initiative passed from the Germans to the Russians for the last time. The Lessons of Geopolitics Clearly, the effects of geography play into the outcome of battles both great and small. The effects of geography may not be as decisive as geopoliticians would have us believe, but they may be enough to tip the scales our way, if we plan judiciously. Regardless of the stakes, if the battle is worth fighting, then it's worth conducting your own IPB to give yourself the greatest chance for victory. Geography—your position on the field of battle—should not be left to chance. Select it beforehand, if possible. Note the inherent strengths of the various options open to you, evaluate the conditions of the conflict to come, and manipulate those conditions to your benefit. 42 Name to Know Spykman, Nicholas (1893–1943): Spykman is known in some quarters as the godfather of containment, the strategy that guided the United States in its rivalry with the Soviets for 40 years after World War II. Attacked as America's geopolitician during the war for daring to envision a postwar world based on raw power considerations, Spykman's predictions were substantiated in subsequent years after his early passing. Suggested Reading Braden and Shelley, Engaging Geopolitics. Brzezinski, The Grand Chessboard. Earle, ed., Makers of Modern Strategy. Hansen, Foundations of Chess Strategy. Hugo, Les Misérables. Landes, The Wealth and Poverty of Nations. Spykman, America's Strategy in World Politics. Questions to Consider 1. We tend to think of "geography" in grandiose terms but sometimes forget that our own micro-geography can lend us competitive advantage. Taking in the "lay of the land" has always been an activity of the finest generals, and developing a practiced eye for the playing field is essential for successful strategic thought. What are the factors that make for a geographic advantage in your own interactions? Do you consciously structure situations to give yourself the geographic advantage? 2. Do your interactions in daily life have rules, either specified or implied? Unwritten rules or conventions can be as important—even more important—than those that are specified. Make a list of unwritten rules in your interactions and identify their sources, whether from tradition or from power relationships. Compare these rules with what is officially 43 stated and take note of the gap. Does this gap offer room to maneuver for advantage? 3. Intelligence Preparation of the Battlefield is too important and useful a concept to be restricted to the venue of combat. If you face challenges repeatedly on the same ground, in the same place, in the same metaphorical space, then a thorough preparation of that conflict space might be worthwhile for you. It's even more critical when you move onto uncharted terrain. Develop your own principles for dealing with opponents on territory of your choosing and evaluate the pros and cons of that territory. 4. Although we all like to take the initiative, sometimes it's necessary to Lecture 5: Geography—Know Your Terrain play defense, and against a strong opponent, this can be demanding. When defending against a powerful opponent, remember the Russian lesson at Kursk: Once a challenger commits, wear him or her down with constant battle and successive lines of defense on well-prepared terrain. This is especially effective when you can choose the battlefield. Identify the resources you could use in a situation in which you were forced to defend your ground against a strong opponent. 44 Grand Strategists and Strategic Intent Lecture 6 S trategic intent—what we sometimes call vision, dreams, or big ideas— is essential to any powerful and effective strategy. For such a strategy to rise above the level of mere technique, it must have an inspirational strategic intent at its core, whether to animate an individual, to inspire a corporation, or to fire the imagination of a nation. In this lecture, we'll look at articulations of strategic intent from the realms of legend, sports, politics, and business. A Definition of Strategic Intent In a classic work from 1989, two influential scholars, Gary Hamel and C. K. Prahalad, coined and defined the term "strategic intent" in the Harvard Business Review. These two thinkers recognized the great flaw in much of our thinking about strategy up until the 1990s: the pursuit of imitative techniques as a substitute for strategy. In contrast to this "strategy of imitation," strategic intent inspires a person or a team with an obsession to win. It articulates a long-term vision or aspiration of the group, reaching beyond current capabilities and forcing group members to develop resources to accomplish the goal. The need to be inventive or resourceful is a result of establishing stretch goals. Merely tailoring your ambition to current capabilities is a formula for maintaining the status quo, but establishing stretch goals without strategic intent is a recipe for failure. o The concept of stretch goals linked to strategic intent is one of the secrets to the Japanese economic renaissance in the aftermath of World War II. 45 o It entails envisioning a future that seems nearly impossible, then striving to acquire the capabilities and resources to make that future possible. Numerous Japanese companies adopted versions of this philosophy, including Honda, Matsushita, Sony, and Toyota. Strategic intent entails identifying an extreme gap between resources and ambitions and developing a strategy to fulfill those ambitions. Lecture 6: Grand Strategists and Strategic Intent Strategic Intent in Myth and in Football Expert mythologist Joseph Campbell identified the "hero's journey" as the archetypal story that has animated all societies throughout history. Every man and woman knows this story and is moved by it. It is the story of Prometheus stealing fire, of Ulysses's return home after the Trojan War, and the quest for the Holy Grail. In this adventure, the hero finds the strength within himself or herself to conquer all obstacles, no matter how seemingly impossible. If this sounds grandiose and far removed from your world, it's not. Your life is filled with heroes and villains, conflict and conquest, failure and triumph. In establishing your own strategic intent, it's useful to keep the hero's journey in mind. Another clear example of strategic intent comes from the world of sports. Few men embody the idea of strategic intent as much as Vince Lombardi, the legendary coach of the NFL's Green Bay Packers. Lombardi's grasp of strategic intent was sure and unambiguous: "Winning isn't everything, it's the only thing." As we've said, every strategy requires a powerful strategic intent to animate it. Equally, the intent must be translated into achievable midrange goals. For his players, Lombardi translated the overall goal of winning into a clear statement of strategic intent: "You never win a game unless you beat the guy in front of you…." If we consider a football team as a value chain, with victory dependent on each player's individual effort and continuous high performance, it's clear how the notion of strategic intent fits into strategic planning. 46 It's also clear that mere technique can never successfully substitute for strategic intent. An offensive lineman is not motivated to perfect his blocking technique merely to achieve "best practice" in the field. A quarterback does not give a record-breaking performance in some vague "search for excellence." Competition between Nations and between Good and Evil Two more famous examples of strategic intent coupled with appropriate tactics come from two contrasting arenas—the first is competition between nations; the second, competition between good and evil. In the 1960s, President John F. Kennedy was faced with a Soviet threat that appeared as a powerful and plausible alternative to the democracies of the West. Kennedy responded to this challenge with boldness, issuing a brilliant articulation of strategic intent: "We choose to go to the moon in this decade…." As we know, Kennedy's goal was achieved less than 10 years later. Martin Luther King gives us an example of the melding of a powerful strategic vision with a perfectly executed strategy. He marshaled the forces of an entire nation with a vision of social justice, and he crafted a strategy that every single person could execute as a significant player— the strategy of nonviolent civil disobedience. o The spirit of nonviolence inspired King to move a generation of men and women in a quest for social justice. In front of 200,000 listeners, King articulated his powerful vision in his famous "I Have a Dream" speech. o Against King stood a phalanx of opposition animated by its own strategic intent. Alabama Governor George Wallace had articulated that intent in his inaugural address: "Segregation now, segregation tomorrow, segregation forever." o But King rode a groundswell of slowly increasing popular support as the evils of segregation were revealed. His movement's successful tactics resulted in the Civil Rights Act of 1964, among 47 other successes. Against a corrupt and racist system equipped with every advantage, King brought nothing more than his strategic intent and a powerful strategy. Lecture 6: Grand Strategists and Strategic Intent Let's consider another example from international politics. For 40 years after the end of World War II, the United States was enmeshed in the Cold War, an ideological struggle between democracy and communism. Our nation pursued a single coherent foreign policy for all of those years, inspired by a core strategic intent. o That policy had as its touchstone a strategic intent inspired by American diplomat George Kennan. In 1946, Kennan sent his famous classified telegram, presenting the idea that Soviet leadership was impervious to reason but highly sensitive to the logic of force. o The reasonable extension of this assumption was that the United States ought to meet Soviet power with American power and to "contain" Soviet expansionist schemes. The strategic intent of containment became the foundation of American foreign policy for the next 40 years. o As we know, the United States eventually triumphed; Eastern Europe was liberated from communist oppression in 1989, followed by the collapse of the Soviet Union in 1991. Strategic Intent in Business India's largest multinational conglomerate, Tata Group, led by the visionary businessman Ratan Tata, offers us another example of the power of strategic intent. 48 In 2003, Tata established a clear strategic intent for his automotive company. He envisioned the People's Car, a four-passenger vehicle meeting minimum safety and emission standards that would cost about $2000. Although his engineers balked, Tata insisted on both the price and a brutal timetable for production. The result was the unveiling of the Tata Nano in early 2010, a tiny, inexpensive, four-passenger automobile designed and built in India. The innovative cost-cutting measures used in production of the Nano have since revolutionized the way automobiles are made and sold— in price, size, distribution, and technology. The development of the Nano may have created an entirely new management revolution akin to the Japanese kanban system, just-in-time processes, and kaizen (continuous improvement). Absent or Misguided Strategic Intent Digital Equipment Corporation (DEC) is an example of a company that refused to make the hard choices necessary for coherent strategy and found itself paralyzed, unable to even articulate a strategic intent. o In 1992, faced with the necessity of charting its strategic direction in a chaotic electronics industry, the company issued this statement: "DEC is committed to providing high-quality products and services and being a leader in data processing." o The vague language and lack of focus in this statement is an indicator of faltering leadership. It was surely not designed to rally the troops at a time of company crisis. Six years later, DEC was swallowed by Compaq. Levi Strauss, the maker of blue jeans, serves as an example of misguided strategic intent. Under CEO Bob Haas, who assumed leadership in 1984, the company adopted a strategic vision that looked inward, ignored the customers, and seemed to have nothing to do with selling jeans. As a result, its market share plummeted from 48 percent to 17 percent between 1990 and 2000. Another example on a far greater scale than a single company comes from imperial Japan in the 1930s. At the time, the prime minister of Japan envisioned an Asian economic alliance, free of the Western powers, to be called the Greater East Asia Co-Prosperity Sphere. 49 o It was purported to be a new international order that sought a euphemistic "co-prosperity" for countries throughout Asia. Of course, it was really a front for Japanese imperialist ambitions and led to the establishment of puppet regimes in every place the Japanese were ascendant. o As we know now, Japan overreached. It did not have the capabilities to match its ambitions. Although its strategy worked for a time, in the long run, it was not tenable. Lecture 6: Grand Strategists and Strategic Intent 50 Lincoln grappled with the greatest trial of any president in American history: He was forced to wage war against his countrymen. But he did not do so simply and reactively or as a mere technical process. Instead, he waged war with the strategic intent of maintaining the Union as a free country. © iStockphoto/Thinkstock. Abraham Lincoln As a final example of a powerful and successful statement of strategic intent, let's turn to one of America's most revered leaders, Abraham Lincoln. Lincoln faced the possibility of the dissolution of the country by bloody civil war; he met the challenge with a strategy aimed at preserving the Union. Lincoln's articulation of strategic intent was made in the Gettysburg Address, a eulogy for those who had died in battle in the Civil War: "we here highly resolve that these dead shall not have died in vain— that this nation, under God, shall have a new birth of freedom—and that government of the people, by the people, for the people, shall not perish from the earth." Charting a Bold Course From foreign policy, to social policy, to business, sports, and even myth, strategic intent provides a powerful impetus to drive cogent strategy and motivate people to implement the strategy. Strategy without strategic vision is merely soulless technique, a great flurry of activity. There is nothing courageous about making a bold pronouncement in vague language. Lack of strategic intent means a loss of focus and the routinization of process. We've seen that articulating a strategic intent requires boldness, grounded in a strategic and accurate assessment of reality. It means charting a course and closing off some options because you have elected consciously to pursue one goal with single-minded fervor. Names to Know Hamel, Gary (1954– ): Fortune magazine has called Hamel "the world's leading expert on business strategy," and Forbes has ranked Hamel as one of the world's top 10 most influential theorists on business, competition, management, and strategy. Kennan, George (1904–2005): Few people can claim to have set the foreign policy course for an entire nation for 40 years, but as a young embassy official in the Soviet Union in the 1940s, Kennan did exactly that when he crafted what would become the U.S. policy of containment with regard to the Soviets. Kennedy, John F. (1917–1963): Few presidents can claim the kind of strategic vision that Kennedy possessed, founding the Peace Corps, laying the groundwork for the U.S. Special Forces, and charting a course for eventually reaching the moon. King, Martin Luther, Jr. (1929–1968): America's great civil rights leader carried a passion for justice along with a strategic vision and the proper tactics to see that vision through to completion. 51 Lombardi, Vince (1913–1970): One of the great motivators and leaders that sports has ever produced, Lombardi's teams won the first two Super Bowls, and his aphorisms on leadership have since entered the lexicon as classics. Prahalad, C. K. (1941–2010): Prahalad teamed with Gary Hamel in one of the great scholarly collaborations in business history, developing pathbreaking theoretical and practical notions that guide multinational corporate thinking today. Prahalad is most remembered for his last works, focused on market solutions to alleviate poverty at the "bottom of the pyramid." Suggested Reading Campbell, The Hero with a Thousand Faces. Hamel and Prahalad, "Strategic Intent." ———, Strategic Intent. Lecture 6: Grand Strategists and Strategic Intent Questions to Consider 1. Strategic intent is a powerful core for any strategy. We can sometimes lose sight of this core, wrapped in the minutiae of the day and focused on task accomplishment. In the process, our strategy can lose its focus. Select a major goal in your professional life right now and assess whether your strategy is guided by a strong, focused core of strategic intent. Can you narrate this intent in one or two short sentences? 2. Strategic intent means identifying an extreme gap between resources and ambitions and developing a strategy to fulfill those ambitions. Are your own goals ambitious, or have you intentionally set goals that are easily met? If it's the latter, set a major goal today that seems out of reach and then realistically assess what resources must be acquired and what capabilities developed to achieve that goal. 3. We sometimes shortchange ourselves by not thinking grandly enough. John F. Kennedy and Martin Luther King were grand thinkers and visionaries who were able to articulate strategic intent to achieve almost 52 impossible goals. Do you have grand goals, or have you unintentionally limited yourself by closing off certain options before they are even considered? Spend a few minutes each day thinking "grandly" about ideas that most people would reject, telling themselves, "You can't do that." 53 The Core and the Rise of Strategic Planning Lecture 7 E Lecture 7: The Core and the Rise of Strategic Planning very firm must have a core mission—a reason for its existence, a mission for which it alone is suited. From the concise articulation of that mission, strategy emerges in a process, either aimless or thoughtful. In this lecture, we trace the history of strategic planning and look at some of the problems that plagued its early development. We then learn a six-step strategic planning process that serves as a useful framework for any strategy development. A Founding Myth The founding myth of the French Foreign Legion is drawn from the story of the brave Legionnaires who fought at Camerone in Mexico in 1863 and the respect accorded them by their opponents, the Mexican nationalists. The values and mission of the Legion spring from this beginning and are reflected in its motto and its code of honor. Every organization should have a founding myth that exemplifies its code or mission, one that is substantial and inspiring and captures the spirit of the organization. Think of Apple Computer's founding myth of two young men in a California garage starting the computer revolution in 1975. The Mission Statement The founding myth should inform the organizational mission statement, which anchors strategy and serves as the basis for strategic intent. This statement should be bold, lofty, and inspiring, like that of the Coca Cola Company: "To refresh the world; to inspire moments of optimism and happiness; to create value and make a difference." 54 But mission statements—and the strategies they engender—can often be mundane, uninspiring, or routine. Henry Mintzberg, one of the great strategist academics of the past 20 years, has a special place in his heart for the elegant, different, and exciting strategy. He says: "The most © Stocktrek Images/Thinkstock. After World War II, military methods of strategic planning were applied to business on the assumption that valuable lessons might be learned from the titanic logistical operations involved in defeating Germany and Japan. interesting and most successful companies are not boring. They have novel, creative, inspiring, sometimes even playful strategies." Equal Exchange, a small coffee company based in Massachusetts, has the mission statement: "Fairness to farmers. A closer connection between people and the farmers we all rely on." From this statement, the company has laid out a series of achievable objectives, a superb example of defining a mission that supports strategic planning. The History of Strategic Planning Strategic planning began in the military. Marshaling resources, training and arming soldiers, planning maneuver on the battlefield—all these activities require forethought and planning. 55 Lecture 7: The Core and the Rise of Strategic Planning Prior to the Napoleonic era, planning was the province of the general or the monarch, with advice from his trusted confidantes. The development of military staff planning began with the Prussian general staff in 1807. The idea of formal planning made its way slowly into the business world after World War I. The Harvard policy model, developed in the 1920s, was more of a general call to action than an actual methodology, but it charted a direction in th