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Cover of 'The art of business wars'

The art of business wars

David Brown

Strategic insights for leaders from historic corporate clashes

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Description

Pepsi vs. Coca-Cola, McDonald's vs. Burger King, Pizza Hut vs. Domino's, Starbucks vs. Dunkin' Donuts, Uber vs. Lyft - the business battlefield is as intense as any national conflict. The strategies of ancient military leaders, especially Sun Tzu from around 500 B.C., are surprisingly applicable to these modern brand wars. Despite his ancient context, Sun Tzu's insights into strategy are timeless, teaching us that the lessons of history's military tacticians can guide us in the corporate arena.

Careers and companies may hang in the balance, echoing Winston Churchill's wisdom that understanding the past can illuminate the future. Sun Tzu's advice to move only when advantageous, engage only when beneficial, and fight only when necessary, remains profoundly relevant for navigating today's competitive business landscapes.

Table of contents

01

Cold reception in conflict

Sun Tzu's wisdom in "The Art of War" suggests that victory in battle comes from thorough preparation. This concept applies to business, particularly when entering a new market, which is akin to going to war with established players. A warm welcome is not to be expected; understanding the battle is crucial before commencing.

Henry Ford's journey with the Ford Motor Company, founded on June 16, 1903, exemplifies this. At that time, less than 8,000 cars existed in America. Ford's vision diverged from his backer, Alexander Malcomson, who saw cars as luxury items for the wealthy. Ford aimed to create an affordable, reliable car for the masses. In 1906, Ford released the Model N for $600, against Malcomson's wishes. To pursue his vision, Ford established the Ford Manufacturing Company for engine production, eventually buying out Malcomson. This led to Ford controlling the entire manufacturing process, from steel mills to assembly lines.

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02

Timing over early entry

Certainly! Here's your text expanded to approximately 277 words without using markdown, lists, or source numbers: The concept of time travel has fascinated humans for centuries. The idea that one could move forward or backward through the years, witnessing the past or future, is a tantalizing notion that has been explored in countless stories and theories. Time travel is often depicted in science fiction as a means of exploring what-if scenarios, understanding the consequences of actions, and experiencing historical events firsthand.

In literature and film, time travel is typically achieved through the use of a machine or other technological device. These stories explore the implications of changing the past and the ethical dilemmas that come with having the power to alter history. Characters often face paradoxes, such as the grandfather paradox, where a time traveler might prevent their own existence by influencing past events. The science behind time travel is largely theoretical. According to Einstein's theory of relativity, time is a fourth dimension that's intertwined with the three spatial dimensions. This suggests that if one could travel at the speed of light or find a way to manipulate the space-time continuum, time travel could theoretically be possible. However, the physical and technological barriers to achieving such feats are immense, and no practical method for time travel has been discovered.

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03

Supply chain dominance

Sun Tzu, in "The Art of War," emphasized the importance of logistics and the ability to sustain one's forces, a principle that can be applied to business success. In the context of franchising, this concept was exemplified by the McDonald brothers, who in 1937 opened a hot dog stand in California. As the automobile industry grew, they adapted their business to meet the changing demands, eventually focusing on hamburgers and creating a streamlined operation. Their innovative approach, which included a distinctive kitchen design and the iconic Golden Arches, quickly gained popularity due to the food's consistency and the service's speed.

Ray Kroc, a milkshake mixer salesman, recognized the potential in the McDonald brothers' business model and proposed to franchise their concept. Under the agreement, Kroc would manage the franchising in exchange for a fee and a percentage of the gross sales. However, Kroc's contribution to the McDonald's success story went beyond mere expansion. He discovered the importance of details, such as the storage of potatoes, which affected the quality of the fries. By mimicking the air-curing process he observed in California, he improved the taste of the fries served in his Chicago restaurant.

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04

Strategic business placement

In 1992, Steve Jobs was ousted from Apple, but he returned in 1997 as interim CEO and made the strategic decision to cancel the Newton MessagePad, directing the company's focus back to personal computers. Once Apple regained its status in the PC market, Jobs introduced the iPod in 2001 and the iPhone in 2007, which combined a music player, phone, and internet communicator into a single device. This move placed Apple in direct competition with Research In Motion's (RIM) BlackBerry, the leading smartphone for enterprise with its signature keyboard.

Initially, RIM's co-founder Mike Lazaridis dismissed the iPhone as a gimmick, while Jobs touted the iPhone's touchscreen as a versatile feature allowing customized interfaces. RIM, co-led by Lazaridis and Jim Balsillie, focused on enterprise sales, which allowed for significant accounts but often resulted in less user-friendly products. The co-CEOs' differing strategies led to internal conflict, and despite RIM's dominant market share, Apple's continuous iPhone improvements and the introduction of third-party apps shifted the industry.

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05

Agility in market shifts

Sun Tzu's wisdom on taking advantage of the enemy's unreadiness and attacking unguarded spots is timeless, and it perfectly applies to the business world where disruption is inevitable. Great leaders know the importance of staying nimble to survive. In 1972, John Murphy, the new CEO of Miller Brewing, aimed to revitalize the brand by targeting blue-collar workers with the slogan "It's Millertime!" Despite initial setbacks, the introduction of Miller Lite as a low-calorie, less filling beer eventually propelled Miller to the number two spot in market share.

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06

Decisive competitive blow

"In war, avoid what is strong and strike at what is weak." – Sun Tzu, The Art of War. Some business wars are fought and won through years of patient effort, and brilliant execution of strategy. Others are won with a single flash of inspiration, and a timely strike. One evening in the spring of 1966, Rollin King and Herb Kelleher sat together in the bar of the St. Anthony Hotel in San Antonio, Texas drinking whiskey. Rollin King owned a small charter air service that recently went bust, and Herb Kelleher was his lawyer. King announced that he wanted to build a full-fledged commercial airline that would fly only the Texas Triangle – Dallas, San Antonio, and Houston.

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07

Strategic deceptive tactics

In the 1930s, New York witnessed a fierce competition to build the city's tallest skyscraper, fueled by new steel construction techniques and a booming economy. Architect William Van Alen was commissioned by Walter P. Chrysler to design the Chrysler Building, aiming to surpass the height of the Woolworth Building. The Chrysler Building, set to be the world's tallest at seventy-seven stories, began construction on September 19, 1928. Concurrently, H. Craig Severance, working for The Manhattan Bank, planned a skyscraper to exceed the Chrysler Building's height.

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08

Marketing through belief

Earl Tupper, a plastics engineer at DuPont post-Great Depression, founded his own company, thriving on government contracts during the war. Post-war, facing a shortage of plastic resin, Tupper innovated with polyethylene, creating a durable, acid-resistant plastic perfect for food storage, thus birthing Tupperware. Initially, sales were sluggish as consumers were accustomed to metal and ceramic storage. However, sales spiked in Detroit, thanks to Brownie Wise, a skilled saleswoman who excelled in Stanley Home Products' home-party sales model. Wise's approach, demonstrating Tupperware's effectiveness in group settings, proved revolutionary.

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09

Op­por­tu­ni­ties in downturns

Adi Dassler, a German cobbler's son, began making athletic shoes from leather scraps found on battlefields after World War I. His innovative idea was to create sport-specific shoes, leading to the development of spiked running shoes and studded soccer cleats. With his brother Rudi, they formed Gebruder Dassler, which gained fame when Lina Radke won Olympic gold in their shoes in 1928. The 1936 Berlin Olympics saw almost all German athletes wearing Dassler shoes. Adi also provided Jesse Owens with shoes, which after his victories, skyrocketed the demand for their brand. World War II shifted their production to military gear, but post-war, the factory returned to making athletic shoes with help from American soldiers.

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