Strategy books and business: on war or at war?
By Jan-Willem Boots
Nearly 200 years ago Carl von Clausewitz wrote that war is the continuation of politics by other means, and that a strategy is required. Can we today make a similar statement for business? Is business the continuation of making money by other means? If we say that for business a strategy is required than I think this is indeed a good proposition. I also think it is a right proposition because it will set business apart from activities like: robbery, theft and fraud.
“Business is the continuation of making money by other means”
The military origin of strategy and tactics is not unknown in business – many will have read the work of Sun Tzu who was writing for winning wars, not for winning business. But the business literature shows only a few other references to the fast amount of writers on military subjects. Is this a surprise? Not really because like Sun Tzu these works were written for winning wars, not winning business, and unlike Sun Tzu many of these works are hard to digest for a business reader. In part this may be because many military writers aim to build a theory while many business books aim to provide winning recipes: the X-things for great success in <fill in business subject>.
The nearly 200 years old and military blockbuster book “Vom Kriege” (on war) by Carl von Clausewitz is no exception. The book is difficult to read and the arguments in it are hard to follow. The first parts are filled with elaborate considerations by which von Clausewitz is trying to decide whether building a theory is even possible in the first place. I struggled, I switched between the English translation and the German original, and I put the book aside very often and left it for days, weeks or even months. I nearly put it aside forever but that would have been a real shame.
“Every organization operates within a chameleon-like triangle”
Why is “Vom Kriege” relevant for a business reader? Von Clausewitz argues that every organization operates within a chameleon-like triangle consisting of: blind instincts, unexpected opportunities & setbacks and the rational strategic plan. These three aspects constantly change – hence the chameleon – and adaptability is needed for dealing with this and frictions working against everything. Business books on recipes for success only provide help and guidance for building a rational strategic plan. The other two are left undescribed, and for setbacks I can even understand this because these will never be part of a recipe for success. This is an unfortunate situation, I think, because in particular the blind instincts are important. I also find this a surprising situation because this topic has not been left untouched by today’s business-related writers. Books covering it are available, selling well and even read in business. The thing is, however, that most are written by journalists who aim to expose the darker sides and wrongdoings of business. This is the journalist’s job and many do it well. What I miss on the business side is a noticeable learning curve.
“Blind instincts, unexpected opportunities & setbacks and the rational strategic plan”
Allow me to elaborate by giving you an example in what recently happened in the Netherlands. The executive board of ABN-AMRO bank announced a significant increase in salary for its top ranking managers. After years with a sober compensation policy they considered it the right thing to do. However, with the banking crisis not yet forgotten – from which the public had assumed they had learned a thing or two, as well as from the book “The Prey” (blind instincts?) about this bank’s own dealings – this escalated all the way into a fierce debate with the Dutch parliament. The direction and intensity of this debate is perfectly exemplified by a quote from a political leader to the HR director of ABN-AMRO: “… I have no idea in which universe you are living!” Rationally the board of ABN-AMRO may have been perfectly right, but they completely missed the raw primal forces and perceptions of this time an age.
This example is only one example and on just one particular incidence. But it does illustrate how an important aspect of what von Clausewitz wrote is also relevant in a business setting. You may now ask whether this is also true for all that he wrote, and this is a good question. On the other hand, if not completely then I think those parts that are relevant are important to understand for a business reader. Many strategies do not reach their goals and the numbers given vary from only 2% to just over 60%. Even if “only” close to 40% of the business strategies fail than within the context of the global economy, or even “just” a national economy, this represents an enormous amount of value and welfare that we miss. I warmly suggest business to start learning what was already learned 200 years ago, difficult to read as it may be.
Jan-Willem Boots is co-founder of Changing Games
