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Research Triangle Business Advisors

September 2014 Newsletter


The Art of War is an ancient Chinese military treatise attributed to Sun Tzu, a high-ranking military general, strategist and tactician. It is composed of 13 chapters, each of which is devoted to one aspect of warfare. It is commonly known to be the definitive work on military strategy and tactics for the past two thousand years. It has had an influence on Eastern and Western military thinking, business tactics, legal strategy and beyond.

What follows is a chapter-by-chapter summary of The Art of War with a focus on Sun Tzu’s strategies that apply to business success.  If you read “enemy” as competitor, “army” as your organization’s staff, and “territory” as the business market you will be able to recognize that current leadership/management strategies are centuries old.


  Bob De Contreras




The Art of War – Sun Tzu

1. The Laying of Plans, Calculations and Estimations

Sun Tzu states: before any steps are taken, research and planning are the key to any venture. He explains that the plan has to be compiled with reference to 5 basic factors:

  • Seasonal Factors and Timing

  • Landscape or Operational Terrain,

  • Leadership Qualities – wisdom, sincerity, benevolence, courage and strictness

  • Management Skills – covering logistics, methodology and organizational structure

  • Moral Law – The way of the world and the laws of human nature.

Sun Tzu also calls for leaders to adhere to classic principles contained in modern project management.  He advises you to have awareness of your capabilities and surroundings, adjust your plans to suit your resources, and track or monitor your operations against possible deviation from the original plan.  Then, get back on track as quickly as possible. He guides us to outwit our enemy (competition) by not betraying our course and being subtle in our direction.

Sun Tzu says: 

“All warfare is based on deception.”

2. Waging War – The Challenge

Sun Tzu focuses on the importance of decisive behavior, correct timing and economy in your actions. He suggests that before embarking in any ventures, we can minimize challenges, conflict and ensuing costs by:

  • Focusing on the logistics of any plan and prevent over-extension of your resources.

  • Maintaining organizational morale and keeping the human resources motivated and well supplied.

  • If you are low on resources and want to save: focus more on exploiting your enemy’s (competitor’s) weakness rather than directing more money or resources at the problem.

  • Consider the wisdom of having effective exit strategies in place in case something does not work. 

Sun Tzu says:

Let your main object be victory, not lengthy drawn-out campaigns.“

3. Attack by Stratagem or Planning Offensives

Here Sun Tzu explains how: “…the skillful leader subdues the enemy’s troops without any fighting”

In other words, avoid competing head on and avoid using up resources directly against enemies. Aim instead for excellence so that no enemy (competitor) would even dare fight (compete).

Sun Tzu suggests this can be accomplished by:

  • Engaging a pre-emptive attack on your enemy (competitors) with your superior capabilities thus demotivating them. Invent the most innovative capabilities, methods, or occupy new territory (market).

  • Failing that, “Surround them” assuming you have adequate resources to cover the territory.

  • Segment” the enemy (competition) or break your problem into parts and attack each individually. Divide and conquer small groups is easier than attacking the larger group.

  • If attack, surround or segment does not work – your only option is to meet your enemy (competitor) head on.

  • Failing that you will be forced into a “siege” mentality which is costly for both attacker and the attacked.

  • Once you run out of resources, you will have to retreat which is an honorable action not to be avoided.

Sun Tzu also points out ways a leader can bring on a failure:

  • Having insufficient vision and a poor understanding of the situation.

  • Using the incorrect amount of resources or methods to meet the challenges.

  • Not being decisive or flexible enough to exploit opportunities – not knowing when to act / when not to act

  • Leading an army that does not have the means to respond to your directives and isn’t able to act on its own initiative when required. 

  • Not communicating your goals clearly and leaving your army to their own devices.

  • Poor skills that lead to utilizing the wrong people for the task at hand, and the inability to motivate your army.

Sun Tzu says: 

If you know neither the enemy nor yourself, you will succumb in every battle”

4. Tactical Dispositions or Positioning

Sun Tzu emphasizes defensive behavior; securing and consolidating the resources you have and using them effectively as a solid base for exploiting new territories. Key to this part of his philosophy is bringing skill and knowledge together with experience.

Sun Tzu says:

One may KNOW how to conquer without being able to DO it”

5. Energy & Direction

Sun Tzu outlines direct and indirect methods of accomplishing your mission.  He encourages us to use these 2 approaches creatively and in tandem. He says being able to alternate methods generates momentum and ensures sustainable results.

Part of Sun Tzu’s strategy on how to “win” the battle includes:

  • The element of surprise

  • Deception: Masking your true strength when trying to outflank or outwit your  enemy

  • Using Bait to outwit your enemy and draw their true intentions and positions.

  • Not relying on any one person but instead focusing on the discipline and unity of your army.

Sun Tzu says:

The quality of decision is like the well-timed swoop of a
falcon which enables it to strike and destroy its victim.”

6. Weak Points and Strong / Illusion versus Reality

Sun Tzu helps us spot the best opportunities for attack, how to spot weaknesses in your opponent and position yourself in the most advantageous way.

  • Take the initiative rather than play catch up – you may waste more resources playing catch up than in taking risks up front.

  • Exploit your enemy’s weak points, expose them and hasten to do better in these areas quickly.

  • Exploit territories where your enemy (competition) has no presence.

  • Exploit enemy (competition) advantage. Maximize your resources where you possess natural barriers to the enemy.

  • Be a moving target and make it hard for your enemy to guess your next move.

  • Never overextend yourself and focus on your strengths. If you have weakness or flaws, consolidate your resources in strengthening a few critical areas not all of them at once.

  • Research to determine the best time with which to activate your plans.

Sun Tzu says:

Do not repeat the tactics which have gained you one victory, but
let your methods be regulated by the infinite variety of circumstances.”

7. Maneuvering and Dealing with Direct Conflict

There will be times when we will still have to meet the enemy head on and may not circumvent them. Sun Tzu advises us to maintain the following if we are to maximize our tactical advantage and emerge victorious.

  • Maintain harmonious relationships between all levels of your hierarchy and create a unity within your army (organization) that operates to an internal discipline. Ensure your army shares the “spoils” to keep them motivated and help them buy into the mission.

  • Always ensure clear lines of supply secured to sustain you throughout your campaign.

  • Make sure you have good local knowledge of the territory with an insider’s view if possible.

  • Know when the enemy is operating at peak strength and only launch your attack when you know they are recovering from another campaign or when they are on downtime.

  • Do not enter into an alliance until you are certain as to the motives of your partners

Sun Tzu says: 

“The difficulty of tactical maneuvering consists in turning
the devious into the direct, and misfortune into gain”

8. Variation in Tactics Because Of the Innumerable Changes

Good tactics also means knowing what not to do. It is not enough to know your army, its hierarchy and the territory well; you also need versatility of mind.

  • Know what paths not to follow, territories that are not worth pursuing or alliances that lead to a no win for your army.

  • If subordinate to a higher command, Sun Tzu’s strategy includes that there are situations where you must not obey your commander. (very important concept)

  • In everything you do, always have the versatility of mind to inhabit the thinking behind enemy (competitor) actions.

  • Be mindful of all your alliances in any action you take, this allows you to escape hidden pitfalls or exploit every potential advantage/opportunity not just obvious ones.

 Sun Tzu says:

“in the midst of difficulties if we are always ready to seize an
advantage, we may extricate ourselves from misfortune”

9. The Army on the March / Moving the Force

Focus on observing the right signs in your enemy.  Read your territory correctly and predict effectively based on the current behavior of your enemy (competitors), costs, and alliances.

A great leader has the ability to read the signs around him, track history and therefore be alert to deception or sudden changes by correctly predicting future behavior.

Sun Tzu says:

“When envoys are sent with compliments in their
mouths, it is a sign that the enemy wishes for a truce.”

10. Terrain or Situational Positioning

Your army will encounter points of resistance.  How you position your army will result in advantages and disadvantages. Sun Tzu prescribes the best positions to take.

  • Make sure that no matter where you are, you have a clear view of the end.

    • When no one makes the first move or you don’t know where your enemy is – do a false retreat to draw out your enemy

    • If your enemy (competitor) has a superior position to you, entice them to focus on something else and fool them into vacating their position

  • Securing lines of supply and good Communications throughout your army are essential otherwise there’s a disconnect between your plans and execution in the territory.

  • If you find yourself trying to match up to your enemy (competitor) and always trailing behind, it can be a destructive activity that eats up too many resources.  You should reconsider the value of the campaign in the first place.

Sun Tzu suggests the following are signs of a failing leader.

  • When you pit your army against a superior force with no preparation

  • When leadership is weak and discipline falls apart.

  • When soldiers are under resourced

  • When leadership does not buy into the organizational mission and rebels.

  • When there are no clear organizational rules, roles or procedures laid down.

  • When the wrong resources or tactics are being used

 Sun Tzu says:

The power of estimating the adversary, of controlling the forces of victory, and of shrewdly calculating difficulties, dangers and distances, constitutes the test of a great general.”

11. The Nine Situations / Terrains

According to Sun Tzu, there are 9 common terrains in any campaign. He prescribes reactions to each one in terms of old world battle scenarios. 

1) Home ground – don’t waste too many resources campaigning here.

2) Entering new territory – keep pushing aggressively early in the campaign as long as nothing gets in the way, and as long as you have a clear easy exit strategy. You aren’t too heavily invested at this stage and can turn back if need be.

3) Contentious ground or strategically essential territory – Do not be the first to move without smoking out your enemy’s (competitors’) intentions first and understanding their strategy too. Hide your true interests and distract the competition where possible from discovering them.

4) Open ground or easily accessible territory don’t get in the way of other enemies assuming their activity is of no strategic relevance to your mission.

5) Ground of intersecting highways – where there is activity from more than one interested party or contender – form alliances with others.

6) Serious ground where much effort was required to secure this territory and you are in a precarious position. It may be hard to exit and hard to move forward. Do not antagonize any alliances and do your best to sustain all of your relationships at their optimum levels.

7) Difficult ground – keep going and don’t stop until you are in a safer position.

8) Hemmed-in ground – where it is difficult to extricate oneself from this situation – resort to deception, intrigue and stratagem.

9) Desperate ground – where there is no exit possible – once there you have to stick it out and give it everything you have, it’s all about survival.

Sun Tzu says:

“Strike at its head [a snake], and you will be attacked by its tail; strike at its tail, and you will be attacked by its head; strike at its middle, and you will be attacked by head and tail both.”  (Be like the snake – quick and adapting)

12. The Attack by Fire

Attack the enemy from the inside.

  • The soldiers  – Poach their personnel , demotivate them or use them

  • The stores – Attack your enemy’s (competitor’s) financial resources

  • The baggage trains – Disrupt their logistics, lines of supply or key suppliers

  • The arsenal and magazines – Capture your enemy’s weapons being used against you – use you enemy’s weapons against them

  • Hurl fire on your enemy as artillery – Destroy enemy operations, by using the most powerful and devastating weapons

  • Follow up the internal attack with your own offensive on the outside and be resourced, time it right and don’t get caught up in the fire.

Sun Tzu says:

“Unhappy is the fate of one who tries to win his battles and succeed in his attacks without cultivating the spirit of enterprise; for the result is waste of time and general stagnation.”

13. The Use of Spies / Intelligence

Sun Tzu warns us against wasteful campaigns that expend a lot of resources or hours of labor when a simple use of intelligence would be more efficient.

Sun Tzu’s strategy states that this intelligence can only be obtained through scout masters, reconnaissance or 5 kinds of spies:

1) Local spies;

2) Inward spies;

3) Converted spies;

4) Doomed spies;

5) Surviving spies.

SunTzu’s advice on how to treat spies:

  • Reward your spies liberally and be perceptive yet sincere when dealing with them.  Above all keep this operation in utmost secrecy internally.

  • If you wish to convert someone into a spy – spoil them. A converted spy is your greatest asset as they can help you recruit more.

Sun Tzu says:

“Spies are a most important element, because
on them depends an army’s ability to move.”

In Summary

The Art of War is based in Far Eastern thinking – the notion of doing by not doing and illusion. Likewise Far Eastern philosophy considers chaos and disruption a sign of failure, not a route to success.

So, if we can position our businesses into a harmonious operation with the world around us – beyond the reach of any threat by being superior and indispensable, practicing excellence and manipulating our environment to remove all obstacles, success is within reach.


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