Business Strategy – The art of corporate war

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From the title of this blog, I am sure some of you might be wondering why I am channelling Sun Tzu.

Statue of Sun Tzu in Yurihama, Tottori, in Japan

Let’s start with the origins of the word ‘strategy’. ‘Strategy’ is originally derived from the Greek word ‘strategos’, which means the art of the general. In other words, the origin of strategy comes from the art of war, and specifically the role of the General in war. In the 2nd century B.C., when Sun Tzu wrote the ‘Art of War’, his writing’s message was plain – to win. 

Despite ‘strategy’ becoming an often-used buzz word in management, there still seems to be a lot of confusion between ‘goals’ and ‘strategy’. To explain this and in keeping with the war theme, let us consider Alexander the Great, King of Macedonia. Imagine a time long ago, Alexander has decided to strive for immortality by creating a true world empire. He calls his generals together and states that his strategy is to build this empire. 

Statue of Alexander the Great in Thessaloniki, Macedonia, Greece

I am not saying that he said that in those exact words because there is no way of knowing what he thought or who he consulted. Hypothetically, if he said that this was his strategy, then that is the wrong use of the term strategy. That was his ‘goal’ – to conquer the world. How he went about conquering the world was the strategy he used.

Now that we have established that ‘strategy’ directly correlates to a general’s role, let us understand what the role of a general is?

A general’s role is not to fight the war but to tell others how to fight the war. It is the general’s vision of how the battles are to take place that is to be carried out, and his orchestration of all the different pieces that will result in the failure or success of his vision. His role is to see the big picture, see what the unit commanders cannot, see the whole, and orchestrate all the units’ positioning to achieve his vision.

Business is also a kind of war, and the casualty of this war is the shareholder’s investment. The Chief Executives’ challenges are similar to that of the generals – to develop strategies that will lead to victory. 

So, how do executives develop strategies that will lead to victory?

In my opinion, four key questions need to be answered by your strategy to be classified as a good strategy.

Where is our market?

You must identify the battlefield that will provide you with the best advantage, like Field Marshal Arthur Wellesley, 1st Duke of Wellington, recognised a field near Waterloo in Belgium to defeat the might of Napoléon Bonaparte. It is essential that an executive correctly identifies the markets that will maximise the profits or reduce costs for his goods and services. 

Field Marshal His Grace The Duke of Wellington

What is our unique selling proposition (USP)? 

During the Napoleonic Wars, Napoléon Bonaparte, for the most part, was the undisputed ruler of Europe. Logically, he should have strangled and run England into the ground. But England had correctly identified two of its biggest strengths – trade and the Royal Navy and used them to not only stay afloat but to ultimately win the war. So, identify the unique value(s) your product or service offers and how it will best benefit the identified market.

The Emperor Napoleon in His Study at the Tuileries, by Jacques-Louis David, 1812

What are our resources and capabilities?

Resources refer to the things we have in our toolbox that can be brought to bear for our benefit. It may be capital – either human or monetary, superior technology, something intangible like brand equity, or tangible, like a diamond mine. How well you utilise what is in your toolbox for maximum benefit depends on your capability. During the Napoleonic Wars, England had a mighty naval fleet (resources), but that by itself is of no benefit as France also had a mighty fleet. What England had were great sailors and leaders like Vice-Admiral Horatio Nelson, 1st Viscount Nelson, 1st Duke of Bronté, among others, capable of wielding the resource (Royal Navy) more effectively.

Vice-Admiral The Right Honourable The Viscount Nelson

Sustainability

Once you have identified your USP and identified your capabilities and resources, how can you sustain in the markets you have identified – to continue to win over time. Even after Admiral Nelson’s death during the Battle of Trafalgar, England did not fall apart; they continued to martial their resources and continued to develop their capabilities to hold France across the Channel.

While the above points give us an idea of what strategy we should employ, they also indicate what we should not be doing. We should not operate in markets where we add no value or do not have the resources or capabilities to maintain sustainable growth. 

A good strategy, while letting us know what we should be doing and why, should also inform us where our boundaries are and what we should not be doing.

I am sure I don’t have to tell you all that this blog is in no way comprehensive and barely scratches the surface on business strategy or strategy in general. Please feel free to add value to it by sharing your thoughts and experiences on developing ‘strategy’. Happy to hear from you!

Please watch this space for similar posts. Strategy forms an integral part of most of our online master’s degree programmes. You can chat LIVE on WhatsApp with one of our Education Advisors for more information on all the programmes we offer, the application process, and for details on discounts we might be offering at this time.

Is your company competitive? Here are 4 strategies to make it one! 

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“No competition, no progress”

Bela Karolyi 

I could not agree more with the world-renowned Hungarian-born Romanian American gymnastics coach, who transformed gymnastics coaching in the US and was responsible for bringing home numerous international laurels. His words are not only applicable in sports but are equally fitting in the business world as well.  

Businesses do not operate in isolation. Gone are the days of monopoly where companies could dominate a market or industry. Today, in the fast-moving-digital-world, every business, big or small, faces stiff competition to hold a fair share of the market.  

Carefully analyze company’s competitive environment when formulating a business plan

When formulating a business plan, it is essential to analyse the company’s competitive environment. The competitive environment is the intricate external system in which the business operates and comprises of several factors or elements that affect and shape the industry. These elements include, and are not limited to:  

1. Competitors – Direct and Indirect  

2. Government regulations and laws  

3. Suppliers  

4.  Substitutes  

5. Technological trends  

6. Demographic Composition  

7. Network of Distribution  

8. Corporate culture  

Industrialists, innovators, and entrepreneurs need to think critically about these factors that affect the company’s profitability and success. (Also, check out our blog on 7 ways to improve critical thinking). It is imperative to understand the competition landscape and scope. This is necessary to prepare the kind of resources, investment, and technology required to build a sustainable and profitable business. In the good ol’ days, companies could thrive with little or no competition. In comparison, companies now must adopt new and innovative means to compete with other firms in the business environment and to have a competitive advantage over them. Strategic forecasting, planning, and implementation can lead to success in competition. Various strategies can help businesses build undefeatable and sustainable products and services.  

Caption – PESTEL model (reference)

Here are 4 strategies that can help build competitive advantages for your business:  

1. Cost Leadership  

Businesses run for profit. By definition, profit is a financial gain realised due to the difference between the amount earned and the amount spent on buying, operating, or producing a product or a service. It is one of the oldest tricks in the (business) book to be a cost-leader. When a business decides to pursue the cost-leadership strategy, it vows to provide the goods or services at a competitively lower price than any of its rivals can ever offer.

Such firms operate on the lowest cost structure, have reasonable control over the entire supply chain, suppliers, and raw materials, and have tight controls on the whole value chain activities. Walmart, IKEA, McDonald’s, Primark, and RyanAir are a few examples of firms that attribute their business success to a cost-leadership strategy.  

2.  Differentiation  

“You can’t look at the competition and say you’re going to do it better. You have to look at the competition and say you’re going to do it  differently”.

Steve Jobs  
Why HERMES?

Offering a low-cost product is not always an option in a competitive environment. Different consumers have different demands. Companies, by providing high-end quality products, also influence many customers’ buying decisions, who would otherwise choose the cheaper alternative. Even though companies always intend to keep their costs low, they are willing to spend on research and development costs, marketing, customer service, or innovation to develop a niche product or service, for which consumers are willing to pay a premium price. Apple, Starbucks, Tesla, Tiffany & Co., Emirates, and Hermes are examples of companies whose thoughtful approach to differentiation and compelling storytelling strategy makes millions of consumers spend premium prices for their products and services.  

3. Focus  

This strategy is quite different from the above two strategies. Business here focuses its primary strategy, i.e., operating at a lower cost or adding value but on a limited market, much narrower in scope than the broader cost leader or differentiator. The company intends to make concentrated efforts based on either a particular buyer group, geographic uniqueness, a unique product line, or a special attribute appealing to a niche customer class to cater to the specific demand of a limited number of customers. Gucci, Rolls Royce, Diet Coke, NetJets, and DC Design are a few examples of companies that have successfully adopted the focus strategy.  

4. Strategic group  

“Anytime you find someone more successful than you, especially when you’re both in the same business, you know they are doing something that you aren’t”. 

Malcom X  
The Cosmetics Industry has close knit competition and companies follow similar strategies to build competitive advantage

Groups of businesses of comparable size and range that operate in the same industry and follow the same strategies to build competitive advantages are termed strategic groups. The competition is so closely knit in such environments that even a small movement by the competitor affects the others’ market position. It helps build a strategic group map to identify businesses’ closest competitors and evaluate how your company is positioned in the industry. Common examples of strategic groups are the restaurants, retailers, cosmetic brands, and the aviation industry.  

These are four strategies, more commonly known as Michael Porter’s ‘generic’ business-level strategies as these can be applied to any business, by any firm in any industry.  

Which strategy do you think is the most powerful in building a competitive business advantage in your own context? Share your thoughts and ideas in the comments below.  

Can entrepreneurship and innovation be taught? 

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Can you think ‘out of the box’?

When I was in school, let’s just say a decade ago.. okay two decades ago, I remember being taught the principles of economics – theory of demand and supply, demand and supply curve, market equilibrium, price ceilings and floors, so on and so forth. Later as a business student at university, I learned about economic models and even more complex financial terms about running a business, such as behavioural economics, macro and microeconomic policies, government policies, international trade and its impact. I have no recollection of ever being asked to or being taught to ‘think out of the box’ (the economics book in this case).  

The businesses, usually large traditional corporations, family-owned companies big and small, ran on the business theories and principles established many years ago.  

Fast forward to the 21st century; I see a new world around me. The businesses are no longer just large corporations run on an old-school of thought. There has been a paradigm shift in the way the companies are run and how they are conceptualized in the first place. I am sure everyone remembers the time of late 90s and early 00s – ‘the infamous dot com/bubble era’ that vowed to change the world and as a matter of fact, it did change the world! 

The bubble burst vowed to change the world

The bubble era engendered a trend of entrepreneurship of a scope like never before. The entrepreneurs – the new gurus of the business world – worked on very different business principles and business plans. Business plans were mainly driven by the strategy of growing big fast, being ubiquitous, insanely high stock market valuations, and focusing on branding and marketing to gain market share. And to establish a new trend, the essential ingredient was innovation.  

Hence, the birth and rise of entrepreneurship and innovation.  

In today’s evolving business environment, entrepreneurship and innovation have become increasingly popular. There has been a notable rise in the entrepreneurial activities around the globe in the last decade. Even the corporations are paying heed to the increasing value of innovation and the entrepreneurial mindset in the workplace. It is now believed to correlate to organisation’s profitability and growth directly.  

Tesla is innovative entrepreneurship while Uber a scalable start-up business entrepreneurship

There are several forms of entrepreneurship, such as Innovative entrepreneurship, social, scalable start-up business entrepreneurship, big and small entrepreneurship. To give some real-life examples, Tesla aimed to innovate the automobile industry by introducing luxurious yet affordable and efficient electric cars. On the hand, Uber, a scalable start-up business entrepreneurship, started with an idea to disrupt the taxi industry and attracted various capitalists’ interest and bagged millions of dollars in investment, scaling the business to an otherwise inconceivable level, growing the company worldwide.  

All entrepreneurs have one thing in common – Innovation

And all the entrepreneurs (and their companies) like Bill Gates, Steve Jobs, Jack Ma, Elon Musk, Mark Zuckerberg, Walt Disney, J.K Rowling, Jeff Bezos (the list cannot be exhaustive), have one thing in common – Innovation. Microsoft, Apple, Alibaba, Tesla, Facebook, and Amazon witnessed tremendous business success through innovation by triggering a paradigm shift or evolving an old product with new technology.  

The benefits and increasing importance of innovation and entrepreneurship are manifold. As mentioned earlier, corporations are also realising their impact on their success. A study by Microsoft and McKinsey states that organisations show a direct correlation between employee retention and innovation, and innovative firms are more likely to retain employees. The study also reveals that companies that were assessed as having ‘innovative cultures’ were twice as likely to expect double-digit growth.  

So, the question remains if someone is a born Entrepreneur, is naturally innovative, or such attributes can be learnt, and whether individuals can be  adequately trained to be innovative entrepreneurs.  

The question remains if someone is a born Entrepreneur

“Profound growth requires innovation and, to foster innovation, you need people to feel trusted and supported to experiment and learn. There can be real returns for leaders who learn to let go and coach teams to constantly improve.”

Dr. Parke.  

To answer the question, yes, entrepreneurship and innovation can be taught, and with proper education, these skills can be mastered. By studying entrepreneurship and innovation, you can learn the underlying principles of starting a business, how to avoid common pitfalls, pitch ideas effectively, validate your product, develop a solid business model, and how to set yourself up for success in a field where failure is common. A good entrepreneurship and innovation programme will expose you to the challenges, contexts, and implications of entrepreneurship and provide you with a sense of the difficulties inherent in starting up and running a new enterprise. You will develop a critical understanding of contemporary discourses surrounding entrepreneurs and entrepreneurship as they are found in a range of national cultures and organisational contexts. The programme brings together relevant contemporary academic theory and research with a practical understanding of activities.  

We offer an online MBA Entrepreneurship and Innovation programme specifically designed to foster entrepreneurial and innovation skills to enable you to have a career managing innovation in existing firms and found new ventures. You will learn how organisations build value by applying entrepreneurial practices, the challenges and opportunities typically facing new and existing businesses, and the ability to design and implement creative strategies. Talk to one of our advisors to learn more about this and our other programmes. 

#DILO (A day in the life of) a master’s student – Andy W

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Continuing with our blog series bringing you answers to some of the questions we at Robert Kennedy College (RKC) get frequently from students who are looking to join one of our online programmes. We asked some of our past and current students to share their thoughts and opinions, to give their feedback on how they handled online learning challenges. Hopefully, this will in turn help you make an informed decision.

Blog series on ‘a day in the life of an online master’s degree student

Let us learn from those who came before and see if what worked for them will also help you become a better student! 

Andy is from the United Kingdom and has completed our 100% Online Master of Business Administration that we offer through an exclusive partnership with the University of Cumbria, U.K., and this is what he had to say about what worked for him. 

An Introduction

Who are you, really? 

Andy W

Which Uni are you studying with? 

University of Cumbria

Which programme did you choose and why? 

Master of Business Administration (MBA)

The Study Plan

Plan the best way to study

How did you plan to study each module, and what was the reality? How many hours did/do you have to put in each day/or in a week?

I planned to allocate a certain number of hours per week on fixed evenings and the occasional weekend, but it didn’t work out that way. I’m definitely a “deadlines” person, so the regular modular structure of the course helped keep things ticking along nicely, with draft essays and other assignments keeping me focused on making good progress. It became more of a challenge with the dissertation as there was a) a hiatus after finishing the last essay and then being allowed to start the dissertation, so I completely lost momentum and, b) there were no intermediate milestones/deadlines to keep me ticking along. As a result, I had to be much more disciplined and ended up taking blocks of time off work to complete the dissertation. I clearly needed to get up a head of steam and tackle sections in a block rather than do a little often with stop-start not working for me.

What part of the day did/do you find most suitable to study? (e.g. early mornings, lunch break, evenings, weekends?)

As above, longer blocks of time suited me best, rather than a particular time of day. That said, because I was also doing a full-time job and other activities, I was mostly restricted to evenings and weekends.

How much time did you devote to each assignment? 

Unknown, sorry – I didn’t keep a log. 

Travelling and Communication 

Travel and staying connected

How did travelling impact your ability to study? 

Work travel tends to be occasional long-haul flights for me, which helped as I could download relevant readings and could then take notes, etc. on the flight. Most of my study time, however, was spent at home. Travelling was not applicable in my case.

How were you able to interact with peers and/or professors given the time differences? 

The forums were okay, but this is the biggest issue with remote courses in my experience. You simply don’t get the same level of interaction, shared learning, and general camaraderie/shared experience as you do with face-to-face learning. This was particularly noticeable with the excellent week-long sustainability residential in Cumbria, especially when juxtaposed against the comparative isolation (even loneliness) of the dissertation. The benefits of remote learning definitely outweigh the restrictions, however. 

A typical day as a master’s student 

What does a typical day as an Online Masters’ student look like for you? 

Lots of evening reading during the modules, getting the interim assignments complete and then a bigger burst of effort in two or three day block for the final assessment submissions. The dissertation was a whole new ball game with longer blocks of time needed to really focus on getting the job done. 

Any advice? 

Listen to advice, but figure out what works for you
Any advice you have for students to better plan their studies. 

I can only suggest people find their own rhythm – if you’re very disciplined, then a little often may work for you, but I’m not like that so had to adapt to fit my own way of working within the wider context of work and MBA deadlines. 

I hope this blog has answered some of your questions, and please watch this space for similar posts. You can also chat LIVE on WhatsApp with one of our Education Advisors for more information on all the programmes we offer, the application process, and for details on discounts we might be offering at this time.