Introduction

[unfinished draft]

It is a cliché to say that we live in times of turmoil and upheaval, but that makes it no less true. Over the past 30 years, our national and global economies have been undergoing a sea change into something that we do not, I think, fully understand even now. The process of this transformation is neither easily managed nor soon ended. At the forefront are the technology-driven markets: electronics (including computer technology), software, telecommunications, biotechnology, information and entertainment — the so-called convergence industries. Technology churn causes these industries and companies to reinvent themselves every two to five years. The pace has quickened since the commercial and household emergence of the first new information utility in half a century: the Internet, with its public face, the World Wide Web. The explosion of hand-held devices, including smartphones and tablets, has caused similar upheaval. And through all this, the distance from the leading edge of technology back to its trailing edge continues to shrink.

Too many good ideas, good products, good technologies die or waste away because the companies involved — especially the small startups — don’t know how to carve out and defend a chunk of the market in which to survive and from which to expand. This book, The Art of ‘Ware, is intended as a survival guide for such firms. While ostensibly written for entrepreneurs, CEOs and company presidents, I would hope that it has value for company employees at all levels, as well as for investors, consultants and analysts. By understanding the principles given here, you increase your value to the firm(s) with which you are associated. By applying these principles, you increase the likelihood of survival for both your company and your job. Failure to do so can mean failure indeed

ORIGINS

The Art of ‘Ware is based on an ancient work of Chinese literature entitled Sunzi bingfa (or alternately Suntzu pingfa) and generally known in English as Sun Tzu’s The Art of War. These writing are named after and attributed to a 6th century BC Chinese general named Sun Wu, more commonly known as Sun Tzu (Master Sun). He, too, lived at a time of upheaval, change and intrigue, a time when the Zhou empire was slowly dissolving into a multitude of competing regions, city-states and clans, a time that came to be known as the Warring States period.

Sunzi bingfa is directly primarily at the general in charge of an army, though some advice is aimed at the rulers to whom the general reports. Through the ages, the book has been prized not just for its military value, but for the deeper issues of conflict, humanity, wisdom, loyalty and risk upon which it touches. Here are some of Sun Tzu’s more famous maxims (taken from the 1910 English translation by Lionel Giles)

All warfare is based on deception.

When you surround an army, leave an outlet free.

To fight and conquer in all your battles is not supreme excellence; supreme excellence consists in breaking the enemy’s resistance without fighting.

It is precisely when a force has fallen into harm’s way that it is capable of striking a blow for victory.

On the other hand, as is common on the Internet, there are a number of sayings wrongly ascribed to Sun Tzu, such as “Keep your friends close but your enemies closer.”

FORMAT

In Sunzi bingfa, each chapter (thirteen in all) usually covers a particular topic, giving a set of maxims with advice on military matters. Throughout the centuries, various commentators interpreted or expanded upon these maxims, or gave historical examples illustrating them.

This book follows the same structure, the same number of chapters, and the same order of topics as Suntzu pingfa. The maxims within each chapter have been rephrased with the intent of describing how to succeed at developing and marketing products from the convergence industries mentioned above. Again, the order of ideas has been largely preserved, with the appropriate updating. However, in some cases I have combined, rearranged or eliminated maxims to produce a more logical organization or to avoid redundancy.
Most maxims are followed by brief commentary expanding upon or clarifying the concept being presented. Since my background in primarily in information technology, that’s where my examples are drawn from. But the principles can be applied in many different industries and to business in general.

In the Bibliography, I have listed current English translations of Suntzu pingfa, all of which I own and have read. A few of these, based on more recent findings and scholarship, have led me to consider changes to the maxims themselves. I’ve also listed contemporary books that I feel have important things to say about the topics covered here.

CONTENT

There is a natural translation that occurs in going from Sun Tzu’s time to ours: generals become CEOs, rulers are the boards of directors, soldiers transform into developers and marketers, the landscape is the marketplace, and enemy forces simply become the competition. But that mapping, except on the simplest level, is anything but mechanical. The challenge time and again has been to come up with an appropriate parallel that directly reflects all of what Sun Tzu had to say, yet is meaningful for the topic at hand and sustains itself through several related maxims, a chapter, or the entire book.

There is little in here of development methodologies or management theories, just as Sunzi bingfa seldom talks about how to organize an army or which weapons to use. If Sun Tzu had focused on those details, his writing would have become quickly dated; instead, by eliciting underlying principles and truths, he left timeless advice. Likewise, my hope is that by avoiding current fads or theories, this book can offer broad application and age gracefully in an industry that is constantly reinventing itself.

Lacking 2500 years to circulate galleys, I was forced for the first print edition to provide the simple commentary that follows most maxims, drawing upon my own experience in IT industry, including direct contribution to over a dozen commercial products. However, to help this second edition live up to both the spirit and intent of Suntzu pingfa, I am soliciting commentary from those of you who want to expand upon, provide examples for, or even rebut the maxims presented. See the section “An Invitation” for more details.

INTENT

I confess to a fair amount of soul searching while working on the first edition of The Art of ‘Ware. It made me face directly how much of our economy is based on zero-sum competition: Company A gains only to the extent that Company B loses. This naturally leads to William Davidow’s blunt statement from Marketing High Technology: “Crush the competition.” Such an approach is usually justified in terms of economic Darwinism, implying that the result will be the best products at the best prices for the consumer. Unfortunately, the result is often entrenched mediocrity and success of the lowest common denominator, as is seen in many segments of the industry today.

Sun Tzu has a profound moral tone in his writings, and his fundamental approach is that conflict is the last resort. Still, the advice given here does tell how to inflict economic punishment upon another company. I know firsthand the costs and consequences of such damage, having been laid off three times as part of a company downsizing, and once having the company I worked for shut down altogether. Each downsizing was a response to market factors that have roiled the technology industries since the late 1980s and that continue to rumble even today.

Many established companies already apply Sun Tzu’s principles in their course of business. For example, when I first wrote this book, I gained a healthy respect for Bill Gates and Microsoft; much of what I had found to be inexplicable in Microsoft’s success, or had attributed to luck, I could see was a result of diligent application of many of the principles describe by Sun Tzu. Interestingly, since my original 1995 edition appeared, Microsoft appears to have forgotten or abandoned many of those principles, while Apple has adopted them wholesale — and the results are reflected in both technical leadership and stock price history.

Most successful innovations come from small companies, as do most failures. It’s quite common for a small firm to come up with a great new idea and fail while bringing it to market. After that happens, the larger firms pick upon the bones for the good parts, which are often poorly grafted into their own products or quietly disposed of.

My original hope back in 1995 — and my hope still — is that this book will serve as an equalizer, that it will help the smaller companies to survive and thrive in the midst of the large, more established, and more powerful ones. By so doing, it would help reward innovation, decentralize market and technology control, and make the free market a bit freer in the industries that — for better or for worse — have shaped our lives over the past few decades and will dominate our lives in this, the 21st century.