Friday Interview: Sun Tzu and the Business World

When looking for ways to improve your business, you might not think of turning toward an ancient Chinese military text for help. But Mark McNeilly has mined Sun Tzu’s The Art Of War for lessons you can apply to the business world. McNeilly, executive director for brand management and strategic marketing at Lenovo, is author of Sun Tzu and the Art of Business. He discussed themes from that book with Mitch Kokai for Carolina Journal Radio. (Click here to find a station near you or to learn about the weekly CJ Radio podcast.)

Kokai: Sun Tzu. People who know anything about military strategy have probably heard the name. Some in our audience may have read The Art of War.

McNeilly: Right.

Kokai: The principles in Sun Tzu can apply to business as well?

McNeilly: Yeah. There [are] 13 different chapters he wrote. He was an ancient Chinese general, … but it has since become a classic on the military side as well as moved a lot into business, even being mentioned in the movie Wall Street and The Sopranos, the series. But yeah, there are some specific principles that businesses can use from a strategic standpoint. Really his principles apply to any competitive situation, whether it be warfare, business, sports as well, any competitive situation.

Kokai: What are some of the main things a business person can learn from Sun Tzu?

McNeilly: One of the things is win all without fighting, that is one of his main principles. It is not necessary always to fight, but you might use a more indirect approach to achieve your objectives. Therefore, from a business standpoint, that means you not only want to get market share, but you want to get profitable market share. And you do that not by having price wars and attacking your competitors directly, but finding positions in the marketplace that you can defend and that it is very difficult for your competitors to attack you at.

Kokai: You mentioned that there are several different pieces to this as well. Beyond that basic one, what are some others?

McNeilly: Another one is avoiding strength and attacking weakness. Often in the West we have the view that we must directly attack our competitors, but unfortunately that is what competitors are expecting, and that meets the greatest resistance. So it is much better to take an indirect approach, to attack them in a different way, a subtle way that they may not expect. That … gives you an advantage and avoids a competitive response from them.

Kokai: Now let’s back up a bit and talk a little bit about Sun Tzu and how he came up with these ideas. These are not new. We mentioned this was an ancient text. So how long ago was this, and how often was it applied in his time?

McNeilly: It was about 500 B.C. He lived during a time called the “Age of the Warring States,” which was a time of a lot of competition between seven different states in China, each trying to control China and survive. And each of these states would look for strategic consultants, if you will, to come around and help them build their strategies and lead their armies. And Sun Tzu was one of these traveling consultants. And it was at this time he was a general and he took his learnings and put them down in this book, The Art of War. And since then it has been used by Chinese emperors, everyone from the first emperor all the way up through Mao. It was used by Japanese samurai to win control of Japan. It came to the West in the 18th century from a Jesuit missionary. Some think Napoleon was influenced by his ideas. And then it had become more popular in the West, in the military circles, obviously in Asian military circles. And it has become much more known, again first starting in Asia, Japan, Singapore, China, as a, not just a military text, but a business text and very, very popular in the West as well.

Kokai: Why do you think that this eventually caught on in business? Obviously it has been around for roughly 2,500 years. Why did business people eventually say, “Wait a minute. We can apply this to what we are doing”?

McNeilly: I think … there are a lot of similarities between business and warfare. They are both competitive situations. You are trying to lead people. You’ve got morale to build. You’ve got contests of wills and egos. And so there [are] a lot of similarities, and there is a lot that businesses can learn from history and military warfare. A lot of people have seen those parallels and applied them.

I think the other thing that he offers is a different way of looking at strategy. Again, instead of this direct approach and attacking, you know, the enemy, you know, the two knights if you will jousting or the two cowboys shooting out at the O.K. Corral, he is much more about a subtle approach, understanding the enemy’s weakness, trying to take advantage of that weakness, throw them off balance and win the victory.

Kokai: There are principles from Sun Tzu that can be applied to business. But we are talking about two different things here. Warfare is designed to break things and stop people and help one society defeat or vanquish another, whereas business is a little bit different. Are there some things from Sun Tzu that don’t translate as well?

McNeilly: Yeah, I think one thing people make an error on is trying to apply everything directly. … When I was talking to my publisher about the book, many people before had tried to take Sun Tzu’s 13 chapters — his book is organized into 13 specific chapters, a lot of specific quotes — and apply it directly to business. The approach I took was very different. I went through his book, saw … the quotes that kind of fell out that applied to business, and saw how they grouped together. They grouped into these six principles that I’ve got in the book and therefore are much more applicable to business. And in each chapter what I’ve got is a principle, followed by a quote that he has exemplifying that principle, followed by a military example, and then some business examples. So it is a good mix of his ideas organized well, illuminated with his quotes, and then followed by business and military examples.

Kokai: One of the other differences is that the ultimate winner, we hope, in the world of business is the consumer, not necessarily the company. Does a company that applies Sun Tzu’s principles lead to improvements that benefit the consumer?

McNeilly: Yes. I think one of the things that he is very keen on is strategic creativity. So the principles are not a cookbook. They are a framework to apply one’s strategic creativity. And you have to be very creative in order to find these positions that differentiate you from the competition and provide you with a much stronger position. It takes a lot more thought to do that than it does to just attack the competitor on price, for example, or copying what they do and trying to do a little bit better.

Kokai: So applying these principles of Sun Tzu not only will help one company try to vanquish another in some certain market, but it should end up benefiting the consumer and society at large?

McNeilly: Yeah, because it forces again the strategic creativity that makes you come up with new ideas for new products or new services or new ways of doing business. So yeah, the ultimate winner in this is the consumer.

Kokai: You mentioned that this has caught fire to some extent in the business world. Would you have a sense of how many businesses or the types of businesses that have started to use these principles?

McNeilly: You’ll see it more in the executive suite, in the people that do strategy, the people that do marketing. One thing that has made it difficult for it to catch on is it is written for warfare in ancient China, you know, in 500 B.C. And it is a series of quotes, so it is not very easy to read. So … one of the things that I tried to do in the book was make it more available to people and have it make more sense to modern-day business people. But those are the areas you would probably find it in, CEOs, strategic people, marketing people, those kinds of folks.

Kokai: Will some people who have studied other business texts read the quotes from Sun Tzu or read your book and say, “You know, this reminds me of this or that that I’ve read in other areas”? Are there some similarities to existing business texts?

McNeilly: Yes. I think what existing books often do, the good thing is they provide you the foundation of what to do in business. I think this just gives you a different way of thinking about business and specifically strategy in a competitive environment.