The Art of War – 5. Five Essential Elements for Success

The Art of War

Series 5 – Five Essential Elements for Success

 

“Sun Tzu said: The art of war, then, is governed by five constant factors, to be taken into account in one’s deliberations, when seeking to determine the conditions obtaining in the field.  These are:

      (1) The Moral Law; causes the people to be in complete accord with their ruler, so that they will follow him regardless of their lives, undismayed by any danger

      (2) Heaven; signifies night and day, cold and heat, times and seasons.

      (3) Earth; comprises distances, great and small; danger and security; open ground and narrow passes; the chances of life and death.

      (4) The Commander; stands for the virtues of wisdom, sincerity, benevolence, courage and strictness

     (5) Method and discipline. are to be understood the marshaling of the army in its proper subdivisions, the graduations of rank among the officers, the maintenance of roads by which supplies may reach the army, and the control of military expenditure.”  (The Art of War, Section 1 – Laying Plans, Sun Tzu 5th Century BC)

Sun Tzu, as a practical soldier, will have none of the “bookish theoric.” He cautions us here not to pin our faith to abstract principles; “for,” as Chang Yu puts it, “while the main laws of strategy can be stated clearly enough for the benefit of all and sundry, you must be guided by the actions of the enemy in attempting to secure a favourable position in actual warfare.

For example: “On the eve of the battle of Waterloo, Lord Uxbridge, commanding the cavalry, went to the Duke of Wellington in order to learn what his plans and calculations were for the morrow, because, as he explained, he might suddenly find himself Commander-in-chief and would be unable to frame new plans in a critical moment. The Duke listened quietly and then said: “Who will attack the first tomorrow—I or Bonaparte?” “Bonaparte,” replied Lord Uxbridge. “Well,” continued the Duke, “Bonaparte has not given me any idea of his projects; and as my plans will depend upon his, how can you expect me to tell you what mine are?”

Application to business:

Preparing your business in a competitive environment is not unlike Sun Tzu’s ideals for preparing for war. Thinking about these 5 elements can only add value to your business and below these 5 elements are explained in business terms:

  • Moral Law: In today’s liberal world we have to be seen to be doing the right thing, for our employees, the environment and for our customers. If we do not our customers will leave, our employees will be unproductive and we good receive environmental fines.  These challenges should be part of your strategic plan
  • Heaven: This could be related to the cycles in which your business exists. We have to be in a position to capitalise on the busy periods when business is good, to help you through the quiet periods where sales are difficult to come by.  When you create your annual budgets, these cycles should be considered
  • Earth; This could be viewed as the risks that businesses are exposed, such as your competitors, the economy and government regulation for example. Each business should create a robust plan and be prepared for a change in these circumstances at any time
  • Commander: This is all about the leadership of your business. A strong wise and compassionate leader will excel at goal setting, they will be sincere, benevolent, courageous, strict and will drive a culture of discipline
  • Method and Discipline: This is how a business should execute their business plan. The leadership must ensure that the best people are in the right job. Every person in the business should know the business vision and held accountable for their part in its success.  They should be supported by management and set up to succeed.

As consultants it is our job to make sure the businesses that we deal with are fit for purpose and ready for any eventuality.  As Lord Uxbridge’s discussion with the Duke of Wellington identified, know-one knew what was going to happen as they were not privy to Napoleons battle plans.

In the same way, when market forces affect the way businesses need to operate, they generally do so without any pre-warning.  So business owners have to build strong flexible organisations which can react to any eventuality and if they follow these 5 elements, they will be somewhat prepared.

Written by Steve Dodd | 19/12/2018  | Sun Tzu text from : www.suntsusaid.com

The Art of War – 4. Water Alike

The Art of War

Series 4 – Water Alike

 

“Military tactics are like unto water; for water in its natural course runs away from high places and hastens downwards. So in war, the way is to avoid what is strong and to strike at what is weak. Water shapes its course according to the nature of the ground over which it flows; the soldier works out his victory in relation to the foe whom he is facing. Therefore, just as water retains no constant shape, so in warfare there are no constant conditions. He who can modify his tactics in relation to his opponent and thereby succeed in winning, may be called a heaven-born captain.” (The Art of War, Section 6 – Weak points and strong, Sun Tzu 5th Century BC)

 

Sun Tzu suggested that operating an army should be like the running of water.

Water flows downwards avoiding high places taking the easiest course, settling for the low ground; as an army should avoid the strong and strike the weak.

Water change its flow depending on the natural course; as the army should change its tactics depending on its opponent.

Therefore, there is no certain shape of water; nor are there certain tactics that an army should follow. The one who can change best, depending on the present situation and their opponents’ disposition, will obtain victory.

 

Application to business:

This treatise is all about “Flexibility & Adaptability”. The business environment today is more complex than it has ever been, due to some major factors such as: technology, politics and more direct and frequent international communications.

Adaptability has become a “must have strategy” for modern businesses. The ability to adjust and react according to market changes, competitors’ actions, innovation implications, regulation of industry changes etc., will help businesses travel through unexpected emergencies and changes.

A great example is Honda. Between the two world wars Japan received sanctions on the development and trading of industrial techniques from other nations. The Japanese government encouraged local businesses to develop their own vehicle and airplane designs. Soichiro Honda (founder of Honda Motor Co.) started his business by manufacturing automobile piston rings.   

When World War 2 started, the government forced Honda Motors to merge with Toyota. After World War 2, Soichiro started a new business by designing and building motorcycles thereby avoiding immediate competition with other strong competitors such as Toyota, Nissan, Subaru, Mazda. By 1961, Soichiro had earned enough capital and became a master of the design and manufacture of small high revving engines.  However, he still wanted to return to his passion making automobiles. After the second world war, many foreign brands gained access to the Japanese market.  The Japanese government came up with a new policy forcing automobile companies to merge and there would only be 3 companies left by 1963. Soichiro realized it would be almost impossible to start making automobiles competitively and become one of the top 3 companies with market share in 2 years. (from 1961~1963)  

Soichiro took an unexpected approach.  He was determined to participate in the Formula 1 competition.  His aim was to prove Honda was within the top 3 automobile brands in Japan by winning races.  Due to years of experience developing engines and incredible determination, Honda finally won a championship on his second year. Through effective advertising and promotion, Honda survived the governmental merger policies. Even so, there were so many changes and difficulties to be overcome.  Soichiro and Honda were able to adapt and react to many of these problems with the flexibility and endurance that is essential to Sun Tzu 6th treatise of finding a new course like water running down the hill.  And so, the kingdom of Honda began.

 

Written by Conrad (Kang-Wei) Lin | 林剛維, 30/11/2018

 

 

Small Business Entrepreneur Grants Program from Queensland Government

The Small Business Entrepreneur Grants Program from Queensland Government

Is now open for applications.

 

What is the program?

The Grants help small businesses to get off to a better start with access to planning, coaching and training.

The advice must fall under 1 or more of the following areas:

  1. mentoring/coaching
  2. business and strategic planning
  3. professional business advice (i.e. information technology (IT), legal or financial)
  4. marketing strategy development (i.e. branding strategies, social media/digital strategies, market research).

Eligibility criteria

To be eligible, the business must:

  • have a business name registered within the last 4 years
  • have fewer than 20 employees at the time of applying for the grant
  • have an Australian Business Number (ABN)
  • have Queensland headquarters
  • not be insolvent or have owners/directors that are an undischarged bankrupt.

The participating business must provide a project report on completion of the project detailing how the funds were spent and the impact it has had on the business.

Only 1 application will be accepted from an individual ABN or a financial beneficiary of a business.

Successful applicants cannot reapply for this grant in future rounds.

Your business must also be in a financial position to pay up front for the approved training or service(s) in full. If successful, approved applicants will then be reimbursed after submitting supplier invoices and proof of purchase.

How to apply?

It is the perfect time to start getting professional assistance for your business and receive grants from Queensland government.

Thexton Dodd Consulting provides comprehensive business diagnosis, strategic business planning, sales and marketing strategy and implementation etc.

WE CAN HELP YOU APPLY FOR THE GRANTS.

If you are interested, contact us for more details and helps, click the button below:

Also check the government website for more details: QLD GOV Grants

 

The Art of War – 3. Essentials for Victory

The Art of War

Series 3 – Essentials for Victory

 

“Thus we may know that there are five essentials for victory: (1) He will win who knows when to fight and when not to fight. (2) He will win who knows how to handle both superior and inferior forces. (3) He will win whose army is animated by the same spirit throughout all its ranks. (4) He will win who, prepared himself, waits to take the enemy unprepared. (5) He will win who has military capacity and is not interfered with by the sovereign. (The Art of War, Section 3 – Attack by Stratagem, Sun Tzu 5th Century BC)

 

  1. He will win who knows when to fight and when not to fight.

Commanders have to be able to tell if it is a good time to fight. In other words, the skill set to evaluate the battle and gain an estimation of the odds of winning, before they fight.

 

  1. He will win who knows how to handle both superior and inferior forces.

Represents commanders who have to be able to effectively lead either smaller amounts of an army or a larger amount of an army. It means to master military management, capable of organising and operating forces of different scales.

  1. He will win whose army is animated by the same spirit throughout all its ranks.

It means from top to bottom; the whole army has common goals and shared value. It can also be explained as the ability to think for others as if you are in their positions, so people take care of each other for a common benefit.

 

  1. He will win who, prepared himself, waits to take the enemy unprepared.

This means the commander must always be prepared for any possible situation. When incidents occur, the one who is prepared will defeat the one who is not.

“The opportunity is for the one who is prepared”

 

  1. He will win who has military capacity and is not interfered with by the sovereign.

This means when commanders are capable and talented, they can operate the army without too much interference from the lords and will win.

 

Applications to business:

  • Change the payment structure – shared value

Sun Tzu believes common goals and shared value among all ranks will lead to victory. As people start their business and develop and grow it over time, they would often find the productivity has plunged at some point. The business leaders should try to bind the staffs’ interests with the company. Start with an attractive payment structure, change the fixed payment model to partial commission and add a bonus based (note: make sure you budget for the higher salaries these incentives will encourage), the potential extra pay will stimulate the employee’s performance further.

There are plenty of other ways to achieve similar productivity, but keep in mind, the purpose is to create shared value, not to cut the base payment. This structure should be used to stimulate employees to perform better, for their interests as well as companies’.

  • Authorise capable people

In many cases, when a business grows to a certain point, the management hierarchy becomes an issue that may hinder further growth. Some competent staff members often find themselves tied up with the politics of the management system. Sun Tzu indicates that one of the essential elements for victory is to let capable people do their work without interference by the sovereign. Find capable and trust worthy employees, give them the authority and let them take charge with their area of work which will fully utilise their specialist skills.

 

Written by Conrad (Kang-Wei) Lin | 林剛維, 16/11/2018

The Art of War – 2. Combined energy

The Art of War

Series 2 – Combined Energy

 

The clever combatant looks to the effect of combined energy and does not require too much from individuals. Hence his ability to pick out the right men and utilize combined energy.” (The Art of War, Section 5 – Energy, Sun Tzu 5th Century BC)

People often see modern business like the ancient field of war. Rapid change happens constantly all over the battlefield.  War is a life and death matter and is cruel.

The Business world and the ancient field of war have a lot in common. In Sun Tzu’s theory, “to obtain an advantageous situation is crucial”, he believes, good leaders devote themselves into creating advantageous situations with talented commanders. They know how to pick the right people for the right job instead of blaming individuals for not accomplishing task.

Thus, it is that in war the victorious strategist only seeks battle after the victory has been won, whereas he who is destined to defeat, first fights and afterwards looks for victory. (The Art of War, Section 4 – Tactical Disposition, Sun Tzu 5th Century BC)

Hence, great leaders always put themselves in an undefeatable situation in advance and then start the fight. Poor leaders who initiate the fight first, then seek to win afterwards are more likely to lose. This is coherent with the previous mentioned necessity of obtaining an advantageous situation. 

Application to Business:

In the modern business world “combined energy” can be seen as situation development or momentum. Leaders should learn how to obtain advantageous situation for their companies, either through research and development, marketing activities or sales channel management etc.  They should ensure the right people are picked for the tasks to be accomplished.  

*The word “Combined Energy” in Chinese could have multiple meanings. It is associate with the situation, momentum, appearance, rules and patterns of the universe, territory dominated. Due to the abstract nature of classical Chinese writing, there is always something lost during translation.

 

Written by Conrad (Kang-Wei) Lin | 林剛維, 8/11/2018

 

 

The Art of War – 1. Defeat your enemy without a fight

The Art of War

 1. – Defeat your enemy without a fight

 

“Sun Tzu said: In the practical art of war, the best thing of all is to take the enemy’s country whole and intact; to shatter and destroy it is not so good. So, too, it is better to recapture an army entire than to destroy it, to capture a regiment, a detachment or a company entire than to destroy them. Hence to fight and conquer in all your battles is not supreme excellence; supreme excellence consists in breaking the enemy’s resistance without fighting. Thus the highest form of generalship is to balk the enemy’s plans; the next best is to prevent the junction of the enemy’s forces; the next in order is to attack the enemy’s army in the field; and the worst policy of all is to besiege walled cities.” (The Art of War, Section 3 – Attack by Stratagem, Sun Tzu 5th Century BC)

 

This is probably the most famous quote from “The Art of War”. Which shows another level of understanding of the battle field and the nature of war from Sun Tzu.

In his theory, “break the opponents and destroy what they have” is the worst possible way to win a battle; the ideal victory is to defeat the enemy without a fight, take them without damaging the them. Thus, the best solution is to strategically outthink your opponent, second is to carry out diplomacy, thirdly is to attack the enemy, the worst is to siege the enemy.

In other words, Sun Tzu believes the great victory is defeating enemy with no blood shed, but with strategy and diplomacy.

 

In business, the war is in a different form. We can see the worst possible way of “attack the enemy” and “siege” as “long-lasting pricing competition or a fight to the lowest price”. A better way would be to gather information and develop an advanced strategy, such as early engagement with the customer, the second could be through diplomacy or negotiation with suppliers for sole distributorship.  

For example, in early 90’s, business computing was in rapid stage of development, there were huge profits as well as competition in the industry. Some tech companies spent time and money to develop relationships with clients to set standards based on their products and services, and also take advantage due to information asymmetry.  Over all, this worked out as required specifications were extremely beneficial to the company’s business for the future.  This was due to other products not meeting the requirements, they never got into the fight.

An example for the use of diplomacy is a strategical horizontal alliance. In most cases, two or more companies may have similar products that service varying client groups. Instead of competing in the market for their own share, with a proper alliance strategy (even with a competitor), the companies can work together to provide a complete range of products.  Companies forming a business alliance, have the opportunity to gain greater market coverage as well as a cost reduction due to shared resources.

 

Written by Conrad (Kang-Wei) Lin | 林剛維, 31/10/2018

The Art of War – 0. Introduction

The Art of War

0. – Introduction

 

“The Art of War” is the most famous ancient Chinese military treaties among all Chinese classical books. Especially in business and military world.

The book was written during the “Spring and Autumn Period” (771~476 BC) by the military strategist “Sun Tzu”. Since then, it has been reviewed and revised many times through history, later translated and published all over the world. In this series, we will adapt the first and probably most read annotated English version translated by British Sinologist, writer and philosopher: Lionel Giles (1910) for direct quote of the book, combined with more modern conception and understanding from other great authors and myself.

There is a common quote around Chinese businessman: “The field of doing business is just like the field of war.” It is not rare to apply strategy from “The Art of War” to business. The records can trace back to “Warring State” period (475~221 BC). Chinese businessman “BaiGue” has applied the philosophy to managing production. However, who really makes the book what it is today are Japanese. At 60’s, Japanese businessman started to apply “The Art of War” to business management, the most famous example is “Matsushita Kōnosuke”, founder of “Panasonic”, also known as “the god of management” in Japan. He said, learning from “The Art of War”, not only made my business success, I also learn principals on how to live as a person in this world. He specifically marked it as a book required to read for all his senior manager.

In this The Art of War series, I will bring you one Topic at a time for each post, it will consist of a direct quote from the book and an explanation and application for modern business. Hope you will enjoy it like I do!

 

Written by Conrad (Kang-Wei) Lin | 林剛維, 29/10/2018

10 FACTS about small business in Australia

10 FACTS about small business in Australia

 

  1. There are 2 million small businesses in Australia

  1. 97% of Australian businesses are small business

  1. Small business contributes 33% of the GDP

  1. The most dominating industries of small business are real estate service, construction, professional scientific and and technical services

  1. It provides 68% of national employment

  1. Small Business pay up to 12% of national tax contribution.  Medium Business 23%, Large Business 65%.

  1. Half the small businesses do not survive their first 5 years

  1. Cash flow is the most concerned management problem

  1. The majority of small businesses go bankrupt due to lack of strategic planning and poor financial management

  1. Most small businesses do not seek for professional advice

 

Statics and resources gathered from
ABS(Australian Bureau of Statistics): http://www.abs.gov.au/
ASIC(Australian Securities and Investments Commission):https://asic.gov.au/
ATO(Australian Taxation Office): https://www.ato.gov.au/
ASBFEO(australian small business and family enterprise ombudsman): https://www.asbfeo.gov.au/

Stopping Businesses from Failing

Stopping Businesses from Failing

The single most important thing to overcome business failure is the right mindset, the kind of mindset which positively embrace changes.

1. Forward thinking and vision set up

It is crucial to set up company’s vision, which will guide you through development and provide clear thoughts on decision making.

2. Frequent analysis on your business

There are many business analysis techniques. We have identified the three most popular techniques you should use for you business.

  1. SWOT Analysis
  2. A “Use Case Diagram
  3. Business process modelling

3. Planning for cash flow control

According to ATO(Australian Taxation Office), cash flow is the top concern problem for small business. Managing cash flow is critical and can be done with correct tool and strategy.

4. Be confident

Is is very common for a business to go through some hard times on occasion.  A business owner should be confident about the road they chose and learn from their failures.  Like Thomas Edison once said: “I have not failed, I’ve just found 10,000 ways that won’t work.”

5. Set up objectives

Clear and specific objectives with strategic planning will make sure the train stay on track and reaches its destination.  

6. Always think as if you are the customers

Customers drive income, no matter what kind of products or services your business offer.  Always focusing on your customers’ needs, will ensure you maintain your profit. Like the famous quote we all have heard “A satisfied customer is the best business strategy of all”.

7. Find an reliable way to resolve emotions

Running a business is hard in many ways, often you have to deal with struggles and problems which may burn you out physically and emotionally.  Finding channels to resolve the emotions will be very useful for you in the long term.

8. Be prepared for emergencies

Unexpected things happen from time to time, those who are not prepared can be destroyed in a blink of an eye.  No matter if it is natural causes, human causes or political causes, you should develop a plan and be prepared – it could save you a big time.

9. Be creative and different

Taking a creative approach could return you huge profit, although it often means taking risks. With reasonable risk analysis, in many cases, it is good to be bold and try something different.

10. Seeking professional advice

Running a business is tough, not to mention if you are running it yourself.  Seeking professional advice can provide you a thorough understanding about your business.  They will help you build a niche strategy and develop your business with their abundant experience.

 

TD Consulting Continues Growth

TD Consulting continues Growth with several New Clients over the last six weeks:

  • A Dog Grooming company with several shop locations
  • A Home Building Designer
  • A Construction Company
  • A Transport Company

Once again this shows the Diversity that the team offers clients in assisting them to grow their businesses