Overview
After introducing the key elements of strategy, Sun Tzu focuses on the
economics of competition. He does not define victory as simply winning
battles. Success is making victory pay. Moving to a new position has certain
costs. The value of that position must outweigh those costs. This economic
focus is one of the reasons that Sun Tzu's strategy works so well in today's
business world, but even when the costs are not economic there are always
costs in resources, time, and emotion. This chapter provides a great outline
for understanding the consequences of strategic decisions and how those
decisions are made in light of the costs. The chapter offers a basic
analysis of the costs, risks, and benefits of going to war.
We must understand the dynamics of strategic situations. Can we control the
scope of competition? Can we reduce its risks? If so, how?
For Sun Tzu, the first step is understanding the costs of action. How do we
minimize our costs? Can we prevent costs from escalating?
In planning a strategy, the outcome is never certain. How should we respond
to the possibility of failure? How can we balance the potential risks and
the potential rewards?
We must understand the definition of success. When we enter into war, what
are we trying to win? What is the reward our new position offers?
These are all questions that Sun Tzu deals with in this chapter. Strategy in
the real world is more than a game. We are always risking something, if only
our time and effort. We must decide before acting what our risks are and
whether or not we are willing to undertake them. It is possible to “win”
battles and even wars without gaining any reward worth the sacrifice.
Foolish competitive battles can leave everyone a loser. Sun Tzu’s system is
not a method for punishing enemies or winning bragging rights. Its only goal
is winning a prize at a cost that makes it worthwhile.