Sun Tzu's Art of War Applied to Modern Business Strategy

Introduction: Ancient Wisdom in Modern Markets

Several key themes developed many centuries ago by the ancient Chinese military general Sun Tzu may be successfully applied to business situations and markets today. For example, the first chapter of Sun Tzu's The Art of War suggests the importance of—and various ways of analyzing—one's competition, including evaluating chances for success against a given opponent or competitor. Many subjects discussed in The Art of War occur continuously in business and in everyday life, though perhaps differently than Sun Tzu literally describes. These include strategic planning, analysis, information gathering, sorting and processing, seizing the advantage, and deceiving one's competition.

Sun Tzu stresses the key importance of knowledge, wisdom, and understanding—of oneself and of others. That, in fact, often seems to be the dominant underlying theme of each chapter of The Art of War. All other issues and strategies the author discusses are connected, explicitly or implicitly, to that central theme. This essay analyzes key aspects of Sun Tzu's The Art of War and explores ways that many of these principles can be advantageously applied within competitive business environments today.

Intelligence Gathering and Competitive Analysis

Sun Tzu's The Art of War underscores the strategic importance of gathering and effectively processing the best, most thorough, and most reliable information available. Having done so, one must also protect one's sources of information. Even within that context, one must take time to know oneself and one's opposition authentically. This means asking: What does this information mean to me and to my strategic planning and tactics? Who else might want—or already have—this information? Who, including oneself, might be capable of misusing, abusing, or misinterpreting it?

Moreover, Sun Tzu recommends carefully and analytically studying the past in order to learn from one's own mistakes as well as from mistakes made by others. To develop and maintain advantage over competitors, one must also study social attitudes and trends. In war, this might mean analyzing whether a particular conflict is a popular one and why. In today's business environment, it might mean analyzing one's own and competitors' stronger and weaker markets in order to exploit competitors' weaknesses. A good example of this is how Microsoft has outcompeted all rivals and cornered the software market, or how both FedEx and UPS have cut significantly into U.S. Postal Service profits.

Such careful analysis of competitors' strengths, weaknesses, environmental conditions, and markets can lead, Sun Tzu further suggests, to knowledge that—when used properly, reflectively, and in a focused way—may bring about victory in war or in business.

Superior Knowledge, Size, and Wisdom

Sun Tzu further suggests the importance of becoming a superior entity relative to one's opposition—not merely in terms of numbers (the largest army or company), but also in terms of knowledge, experience, and wisdom. A good example of this concept in operation is Walmart, which has effectively combined size with advantageous business practices over many years in order to become, and remain, one of the most profitable retailers in the world.

Such knowledge and wisdom are obtained through combined study and observation of people, situations, environments, and events, as well as through recalling, comparing, and contrasting these with past, present, and anticipated observations. Knowledge gained through such observation may then be strategically applied. Overall, Sun Tzu suggests that one must study, observe, focus, and compare in order to optimally know oneself, one's competition, and both parties' respective environments—both to consider their strengths and to exploit their weaknesses.

In addition, in order to maintain optimal advantage over one's competition, one must carefully protect personal sources of knowledge—advisors, informants, or simply those in one's employ who are skilled at gathering and processing useful information—from being captured, betrayed, or in any way compromised. Careful, well-considered, and disciplined application of knowledge gained from experience, observation, and study can combine to create optimal conditions for success, in war and in business.

Conclusion

This essay has analyzed some of the most important ancient war tactics of Chinese military general Sun Tzu, as described in The Art of War, and has suggested various ways these strategies and practices apply to business even today. In many businesses—including Walmart, Toyota Motor Company, Dell Computers, and other industry leaders—one can identify various ancient war strategies, tactics, and practices, as recommended by Sun Tzu in The Art of War, operating in everyday business decisions and competitive behavior.

Works Cited

Tzu, Sun. The Art of War. Special Edition. Trans. Lionel Giles. El Paso, TX: El Paso Norte Press, 2005.