Willie’s Blog Posts

Von Clausewitz on War: Six Lessons for the Modern Strategist

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Written nearly two centuries ago, Carl von Clausewitz’s classic guide to military strategy, On War, remains essential reading for modern business strategists.

War, wrote the famed nineteenth-century military strategist Carl von Clausewitz, should not be compared to art, but rather to commerce, “which is also a conflict of human interests and activities.”

Yet for much of modern history the word “strategy” seldom appeared in the business vernacular. The concept, derived from the Greek strategia  — a compound of stratos, meaning “army,” and agein, meaning “to lead” — was instead born in the military.

The common term in business before the 1970s was “long-term planning” — the practice of forecasting numbers to map the future. Then business gurus began borrowing “strategy” — a much sexier term — from the military. But for most organizations, this was just a rebranding exercise for existing routines, not a change in behavior. And in many companies these sterile forecasting methods have remained essentially unchanged.

In today’s turbulent marketplace this kind of ritualistic planning is no longer enough. Organizations must also have a winning strategy to achieve competitive advantage and the ability to renew that strategy as the environment shifts. That is precisely the challenge the military has faced through the ages as it contended contends with the changing terrain, chaotic elements, and unexpected opportunities of warfare. From this crucible the great military thinkers honed the fundamental principles of strategy, and few among those thinkers are quite so revered as von Clausewitz.

Clausewitz, a Prussian general who fought against Napoleon, quite literally wrote the book on war. Published in 1832, a year after his death, On War is regarded by military experts even today as the definitive study of warfare. His ideas remain widely taught in military schools, and are, more than ever, essential to the modern strategist.

Strategy is frequently misunderstood and therefore misapplied. More than any other business discipline, it suffers from crippling confusion and over-complication. In fact, the essence of strategy is stunningly simple, and therein lies its power.

Let’s start with the threshold question. Why do we need a strategy in the first place? Clausewitz gives us the answer. Strategy is the necessary response to the inescapable reality of limited resources. No entity, regardless of size, has unlimited resources. Strategy, therefore, is about making choices on how we will concentrate our limited resources to achieve competitive advantage. All else follows from there.

To excel at strategy, we must first understand what it is

The talent of the strategist is to identify the decisive point and to concentrate everything on it, removing forces from secondary fronts and ignoring lesser objectives.

                                                                             – Carl von Clausewitz

Clausewitz lays out here a powerful definition of strategy. Let’s unpack Clausewitz’s definition by examining its key words:

Identify: Good strategy always starts with a situation analysis to create a deep understanding of the competitive environment and our own realities. The military mantra is, “intelligence precedes operations.”

The decisive point: Here he refers to what I call the winning proposition — the central animating idea around which we must organize all our decisions and activities in order to outperform our competitors. Once we have identified this, it’s all about focus and determination.

Concentrate: Note here the words “concentrate everything” — not only our physical resources, but also the hearts and minds of our people. To quote Basil Hart, the military historian: “All the lessons of war can be reduced to a single word: concentration.”

Remove: Every new thing we choose to do subtracts effort from everything else we do. Making choices therefore means deciding what we will not do. These subtractions are the toughest decisions of all, but ducking them can be fatal. The most dangerous choice of all is not choosing.

Ignore: A winning strategy requires a disciplined mind and a steadfast character. No distractions; no sideshows. We must always keep the main thing the main thing.

Clausewitz’s definition gives us the theoretical superstructure for thinking and acting strategically. All elaborations are subplots of this central theme.

Strategy and planning are not the same thing.

Tactics are the use of armed forces in a particular battle, while strategy is the doctrine of the use of individual battles for the purposes of war.

                                                                             – Carl von Clausewitz

Strategy is about picking the right battles. Tactics are about successfully executing those battles.

Strategy is concerned with defining an overall purpose and priorities. It is holistic.  It clarifies how the individual battles fit together and why they are being fought. Strategy’s key role is to define a winning proposition, a rallying call from which all decisions and activities will cascade.

To be clear, planning is also important. But it is not a substitute for strategy. We don’t create a strategy with a plan. We execute it with a plan. For example, your budget should be the financial expression of your strategy, not the reverse. The right sequence is essential: strategy first, planning afterwards.

The strength of any strategy lies in its simplicity

Simplicity in planning fosters energy in execution. Strong determination in carrying through a simple idea is the surest route to success. The winning simplicity we seek, the simplicity of genius, is the result of intense mental engagement.

                                                                                 – Carl von Clausewitz

A strategy must be distilled into the simplest language possible so that everyone in an organization can follow it. Complexity paralyzes. Simplicity empowers. Simplicity is not a short cut; it’s hard work — requiring the kind of intense mental engagement Clausewitz emphasizes.

No strategy document should ever be longer than 10 pages. But the document alone is not the final deliverable of a strategy. Leaders must be able to clarify the strategy in a compelling message, using examples, pictures, and metaphors that provide a spur to action. As Peter Drucker said, “The first task of a leader is to be the trumpet that sounds the clear sound.”

Competition is interactive, not static

Some generals consider only unilateral action, whereas war consists of a continuous interaction of opposites … no strategy ever survives the first engagement with the enemy.

                                                                                – Carl von Clausewitz

One of the most common pitfalls amongst strategists is competitive neglect. We are susceptible to a false mental image that our competitors are standing still — that we are the only ones moving. This happens in particular when we have to play catch-up and close a gap in, say, customer service. In fact, competitors are running as fast as they can, so closing a gap means that we have to run even faster.

Making choices means seeing the world through the eyes of our competitors. What would their most likely counter-moves be? How will we contend with these? Role-playing is a useful way to plot this out. Observe the chess master: no move is ad hoc. Success comes only from thinking several steps ahead.

Morale makes all the difference

War is a trial of moral and physical forces by means of the latter. . . In the last analysis it is at moral, not physical strength that all military action is directed … Moral factors, then, are the ultimate determinants in war.

                                                                                 – Carl von Clausewitz

War of course involves a contest of physical force. It is a blood sport. Clausewitz, however, emphasizes the definitive importance of  “moral factors,” or what we think of as morale.

He makes the blunt claim that once you have destroyed your enemy’s spirit — his will to fight — you have won the war. He notes that the armies that prevail most often are those that have the full-hearted support of their citizens back home. When that encouragement is lacking, self-doubt sets in and motivation is undermined.

This lesson applies equally in the business world, and here we have great cause for concern. Only 30 percent of employees in the U.S., and 13 percent globally, feel engaged at work, according to a 2013 Gallup Survey. This morale deficit bears a dramatic cost. Companies in the top quartile for employee engagement saw 22 percent greater profitability, 10 percent higher customer ratings, 28 percent lower rates of theft, and 48 percent fewer safety incidents when compared with those in the bottom.

Henri Amiel stated it well: “Without passion man is a latent force, like the flint, which awaits the shock of the iron before it can give forth its spark.”

Strategy requires a dynamic process

We need a philosophy of strategy that contains the seeds of its constant rejuvenation — a way to chart strategy in an unstable environment.

                                                                           – Carl von Clausewitz

Organizations create their future through the strategies they pursue. In such high-stakes choice making, an ad hoc approach will not cut it. We must have a shared process inspired by the right thinking. In fast-changing conditions, static methods don’t work. An organization’s survival depends on the mastery of a dynamic process for generating ongoing renewal. Strategy, like any other discipline in the modern world, as Alvin Toffler reminds us, requires constant learning, unlearning, and relearning. This requires a shift of gears from strategy as planning to strategy as learning. Embedding this adaptive capability is, in the final analysis, the only route to a sustainable competitive advantage.

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Note: In composing this article I have drawn on the translations from von Clausewitz’s German text by both Michael Howard, the military historian, and the Boston Consulting Group.

Posted by Willie Pietersen at 1:00 PM | 0 Comments

The Lessons of the Blind Men and the Elephant

The US Army War College describes the chaotic conditions of a battlefield as VUCA – Volatile, Uncertain, Complex and Ambiguous. These are the factors generals must contend with as they penetrate “the fog of war” to determine their strategy. Corporations face the same turbulent market conditions as they vie for competitive advantage. This demands a high level of situational awareness – the essential starting point for the development of a winning strategy.

What kind of mental discipline is involved in creating this kind of situational awareness? The ancient parable of the blind men and the elephant provides some valuable lessons.

In ancient times a king ordered all his blind subjects to be assembled and divided into groups. The groups were taken to an elephant and each group was introduced to a different part of the animal.

Those who made contact with the head described the elephant as a water pot, those who felt the ears defined it as a fan, those who touched a leg said it was a tree, and those who felt a tusk thought it was a peg.

The groups then fell into arguing amongst themselves, each insisting their version was correct and all others were wrong. It was only when they listened to each other and built on each other’s perspectives that they were able to construct the whole picture and “see” the elephant. 

elephant

The big lessons

1) One kind of blindness is to see only what we want or expect to see and to screen out evidence that does not fit our preconceived notions. Psychologists call this the “confirmation bias.” We all suffer from it to one degree or another. It seems to be part of the human condition, but can lead us seriously astray.

For example, in its long march into insolvency General Motors kept blaming its cost disadvantages, while downplaying its quality deficiency versus Toyota – the main cause of its ultimate failure. Xerox committed a similar error when it ignored Canon’s entry into the household copier market. Soon Canon launched a devastating attack on Xerox’s home turf by selling fast machines directly to large companies, thereby toppling Xerox from its leadership position. Both companies simply refused to acknowledge the elephant in the room.

Avoiding the confirmation bias requires a disciplined self-awareness plus rigorous tools to enable organizations to confront the brutal truths they must contend with. Strategic Learning, the strategy process I have developed, requires that as a first step, organizations should do a Situation Analysis where diverse teams develop penetrating insights into 4 areas of inquiry: industry dynamics, competitors, customers and their own internal realities. This helps to avoid the blind spots and biases that can occur when we think alone.

2) As we strive to understand reality, a crucial factor is the ability to harness synthesis. Analysis – the ability to break things down – is a widespread competence. Synthesis, on the other hand – the ability to connect the dots and recognize patterns – is a rare but crucial capability. For example, the US intelligence services have concluded that the majority of the lapses in security (including the 9/11 tragedy) have been failures to see the whole picture by connecting the separate pieces in the puzzle. They were unable to see the whole elephant.

How can we become better at synthesis? I find it helpful to think of synthesis as having two dimensions: a vertical dimension that reveals historical trends and a horizontal dimension that reveals the connections between things. The practical translation of this vertical/horizontal thinking is this: in doing a Situation Analysis, always be sure to map the trends and avoid trying to create an insight from a snapshot. As Winston Churchill remarked, “The further back you look, the further forward you can see.” The trends tell the story. That is the vertical dimension.

To reveal the hidden connections and identify patterns, look horizontally. Examine the key insights from the separate areas of inquiry in the Situation Analysis (industry dynamics, customers, competitors, etc.) and deliberately explore them to discover the connections between them. Don’t stop until you have found the integrated story.

It is horizontal thinking that presents the greater challenge. Yet it is a vital capability. Analysis is necessary, but not sufficient. Most of the major advances in the history of knowledge, such as Einstein’s theory of relativity, have been acts of synthesis rather than analysis. They involved seeing connections between things that had not been previously understood. Brian Greene, professor of physics and mathematics at Columbia University, called Einstein’s theory “the most beautiful scientific synthesis ever achieved.”

We don’t have to be a genius like Einstein to create “the beauty of synthesis.” We can use the simple techniques I have described in order to “out-synthesize” our competitors.

3) A critical component of the kind of insights that produce synthesis is curiosity. By this I don’t mean idle curiosity; just being interested in information that happens to come our way.  I mean energetic curiosity – the relentless pursuit of penetrating questions that challenge our underlying assumptions and re-examine received wisdom.  The first part of the word question is quest. It is noteworthy that everything we know results from a question someone pursued at some point in time.

The method for doing a good Situation Analysis is based on these Socratic principles.   Each team in the four areas of inquiry is given a set of guiding questions to pursue. As they dig deeper, further questions arise until the answers become clear. It is a process of intense mental engagement.

Socrates, as we know, was the great exponent of learning through questions. He believed that great insights are invariably born from great questions. His mother was a midwife and he used to say that his art was the same as that of a midwife. She does not give birth to the child, but facilitates its delivery.

One of the great tasks of a leader is to ask searching questions and to teach everyone in the organization to do the same – not “gotcha” questions that shut down discussion, but questions that invite exploration and dialogue. These are our “portals of discovery.” We will never have all the right answers, but we must have the right questions.

“It is not the answer that enlightens, but the question.”

– Eugene Ionesco

Posted by Willie Pietersen at 11:22 AM | 0 Comments