Chapter 10. Strategy for an Uncertain World
The problem is not ‘people playing checkers when others are playing chess’. The problem is that we’re playing chess while others are playing weiqi.
Uncertainty is central to both the eastern and western approaches to strategy. The Chinese philosophical tradition, from which Sun Tzu emerged, recognised that minor fluctuations in conditions could amplify into dramatic changes, meaning that no two situations were ever identical and therefore no universal recipes could exist. While Clausewitz, the father of modern western strategy, recognised that ‘friction’ (unexpected events) makes ‘even the simplest things more difficult’, meaning analysis is often insufficient and predictions rarely accurate. Yet, despite both recognising the importance of uncertainty, the eastern and western strategic traditions diverged significantly in how they dealt with it. These differences are reflected in (and can be explored through) the dominant games of strategy played today in the East and the West.
Chess is the dominant game of strategy in the West. “The purpose of the game is checkmate, to put the opposing king into a position where he cannot move without being destroyed. The vast majority of games end in total victory achieved by attrition or, more rarely, a dramatic, skilful manoeuvre. The only other possible outcome is a draw, meaning the abandonment of the hope for victory by both parties”.[1] Chess reflects Clausewitzian thinking where the aim is absolute domination, which is achieved by bringing down the full weight of one’s forces against the enemy’s ‘decisive point’.
The dominant game of strategy in the East is weiqi (or Go). Where chess is a “struggle for the centre of the board” with both players seeking to eliminate their “opponent’s pieces in a series of head-on clashes” weiqi “teaches the art of strategic encirclement”. A “talented weiqi player moves into ‘empty’ spaces on the board, gradually mitigating the strategic potential of his opponent’s pieces”.[2] Weiqi reflects eastern thinking, and that of Sun Tzu, where the aim is relative advantage, which is achieved by cultivating superior potential that becomes impossible to counter.
In this final chapter of Book One we’ll contrast the differences between the eastern and western approaches to strategy by using the lenses of chess/weiqi, warfare and business with the aim of articulating an approach to strategy that is more suitable for our uncertain world. The three main differences we’ll explore are:
- The focus on the internal vs external
- Focusing on singular vs multiple wheres
- Treating ‘strategic genius’ as a natural gift vs something one nurtures.
Difference #1: Focusing On The Internal vs. The External
“A chess mindset … focuses on what one can achieve given limited resources at the moment, whereas a Go player thinks about what he can bring to bear with additional resources”.[3]
Clausewitz argued that ‘power determines everything in war’ and this is reflected in the game of chess where pieces have a clear hierarchy of power: The queen outranks the rooks, which outrank the bishops and so on down to the least powerful pieces, the pawns. The game starts with this power fully deployed (i.e. all pieces on the board), which is slowly eroded through a battle of attrition as less powerful pieces are sacrificed for positional gain. Competitive advantage tips towards the player who retains their power best, which can be quickly calculated by counting the remaining pieces on the board or, if both players are evenly matched, by how those pieces are deployed.
Fig. 17: The opening situation in chess
Clausewitz’s focus on power became western military orthodoxy in the 19th century following the military success of Prussia, his homeland, in the German wars of unification. But the subsequent rise of Germany led to competition with Europe’s established power, Britain, resulting in an arms race as each sought to build a mightier military machine to dominate the other with. The ‘Great War’ that would eventually break out in 1914 descended into a bloody series of attritional battles in the mud of the western front as their two mighty machines — cursed by technological parity — were continually launched at the other’s ‘centre of gravity’ (the opposing military). Leaders, confusing their indifference to lives of their soldiers for the determination they believed marked a Clausewitzian genius, sacrificed their men — like pawns on a chessboard — on an industrial scale of killing never seen before. The senseless, multi-year destruction, brought an entire continent to its knees, and led to some western military strategists finding “fundamental faults [with this] costly and wasteful attrition style of warfare … and the strategic mindset ever since in the West”.[4]
An early critic of Clausewitzian military orthodoxy was a British liaison officer to the Arab forces who were revolting against the Ottoman empire, an ally of Germany during the ‘Great War’. The man who would become known as Lawrence of Arabia understood that the small Arab irregular force he was advising could not hope to defeat the larger Ottoman army in battle. But he found that, what current military orthodoxy lacked in guidance, military history more than made up for in encouraging examples: The battles of Julu (207BCE), Badr (624), Morgarten (1315), Agincourt (1415), Panipat (1526) and Lacolle Mills (1814) were all won by less powerful ‘Davids’ defeating military ‘Goliaths’. In fact, this common-recurring pattern continues to this day. Since 1900, military engagements have been won by the larger force only 60% of the time — only slightly better odds than if they’d tossing a coin.[5] Clausewitzian orthodoxy therefore may be wrong — power does not determine everything in war.
Other Western military strategists also sought to go beyond Clausewitzian orthodoxy.[6] However, the Prussian’s ideas have spread widely and deeply into the western culture of strategy. In the world of business today many leaders subscribe to the Clausewitz-like idea that success comes from having an organisation that runs like a ‘well-oiled machine’. There is a tendency to believe that, if they can just bring their full capabilities online, (‘having all their pieces on the board’) success become inevitable. This leads to an overly-internal focus in many organisations — a pre-occupation with building an ever-more powerful ‘machine’ by adopting the very latest technologies and “best practices”. Yet few seem aware that such an approach can’t create a competitive advantage as it’s easily imitated by rivals. The only results therefore are stalemate or a ruinous race to the bottom on prices as neither side can differentiate itself. Nevertheless, a Clausewitzian-like hyper-focus on developing internal power dominates business strategy in the West today as the popularity of ubiquitous change management and transformation programs testify to.
Fig. 18: The opening situation in Go
In contrast to the maximum power being displayed at the start of a chess game weiqi begins with an empty board. Each player has the same number of ‘stones’, which are all of equal value and plays them in a near-infinite number of ways. The aim is to make their whole (position) more than the sum of its individual parts. Where victory in chess comes from deploying one’s power better (dominating the centre of the board and exchanging weaker for stronger pieces) victory in weiqi comes from cultivating superior potential (creating connections between one’s stones that limit the opponent’s options for making moves). Due to the ebb and flow of multiple, simultaneous engagements all across the board at the same time it can be difficult to the untrained eye to see who’s winning, but eventually one player’s accumulated potential becomes irresistible and victory is conceded.
Weiqi reflects the eastern focus on potential (shi) as the determining factor in competitive situations, which is cultivated by making both orthodox and unorthodox moves. Orthodox moves include much of what both Clausewitz and Sun Tzu wrote about (adopting the latest weapons technology, developing sound tactics, managing impeccable logistics). But while western adherents of Clausewitz tend to focus excessively on internal matters (looking to reduce the friction, or uncertainty, that undermines the smooth running of their ‘well-oiled machines’) the eastern approach also focuses on the external. It’s not enough to simply try and keep oneself “from being driven bananas”[7] by uncertainty; one should also try and increase the uncertainty of others. And unorthodox moves increase the uncertainty that rivals have to deal with, keeping them off-balance and diminishing their ability to cultivate potential. This is how one improves competitive advantage over others. Lao Tzu, Sun Tzu’s contemporary, described this as:
“Governing the state by being straight-forward, Waging war by being crafty”.[8]
Orthodox moves reduce one’s own uncertainty (governing by being straight-forward) while unorthodox moves (waging war by being crafty) increase the uncertainty rivals must contend with. Unorthodox moves surprise and confuse rivals, forcing them to spend resources (time, money, attention) trying to make sense of what’s happening. This type of misdirection is rife in both weiqi and the eastern approach to strategy: Subtle feints are made to obscure one’s true intentions, whilst distorting signals (ex, appearing weak when one is strong) lure rivals into making false moves. This constant interplay between the orthodox (cheng) and unorthodox (ch’i) — represented in Chinese philosophy by the yin/yang symbol — enables one to remain ‘formless’, unpredictable and impossible to attack whilst, at the same time, cultivating potential from conditions that, when unleashed at the right moment, can become ‘like a torrent crashing down a gorge’. By incrementally decreasing one’s own uncertainty, whilst continually increasing the uncertainty rivals must deal with, a weaker force can create such a mismatch between them that it can vanquish a stronger force.
Fig. 19: Yin and Yang
However, successful unorthodox moves quickly become orthodoxy. This is why repeating past successes (copying the tactics of the last war, or imitating “best practices”) is sub-optimal — it makes one predictable and easier for skilful opponents to manipulate. General Bonaparte — the archetypal Clausewitzian strategic genius — used a combination of orthodox moves (internal military reforms) and unorthodox moves (flexible operational formations) to surprise his European rivals. But, by the time he became Emperor, Napoleon’s unorthodox moves had become military orthodoxy and made him predicable. Following victory over Napoleon at the battle of Waterloo the Duke of Wellington observed wryly that the French, “came on in the same old way, and we sent them back in the same old way”[9]. Advantages come from surprise, but surprises have limited shelf-lives. The more frequently they’re used the less advantageous they become. One must continually use imagination to create new unorthodox moves that others won’t anticipate, easily make sense of, or respond to in time. For it’s this constant interplay of cheng and ch’i that creates relative advantage over rivals.
Difference #2: Focus on Singular vs. Multiple Wheres
“In Go, it is a war with multiple campaigns and battlefields. There is no one single focus on the board. A Go player must always keep the whole situation in mind”.[10]
The Arab irregulars, advised by ‘Lawrence of Arabia’, launched a series of lightening-fast attacks against their enemy, the Ottomans, across the vast expanse of the Arabian desert. Utilising conditions in their favour (a deep knowledge of the desert and experienced riders able to cover huge distances at speed) the Arab forces ‘drove their opponents nuts’ with unorthodox moves. They manipulated their enemies perception by attacking quickly across huge distances, making the Ottomans think they were fighting multiple forces. They exhausted their rivals by forcing them to continually re-build partially-destroyed supply lines. And they undermined Ottoman troop morale by creating uncertainty about where and when they would attack next. The ultimate success of the Arab Revolt — which took Damascus in November 1918 — was a clear rejection of the Clausewitzian principle that, to win a war, one needed to identify and strike at a singular ‘decisive point’.
The singular focus of chess is to checkmate the opponent’s king and “chess players always try to eliminate the powerful pieces such as the queen, knight, castle, and bishop” in pursuit of this aim. Typically “these powerful military units [are] the “centre of gravity” and “decisive point” [which means] naturally, chess players are single-minded”[11]. And this singular focus is replicated in many businesses today with a rigorous focus on delivering the ‘annual strategic plan’ — a series of steps designed to close the gap between where the business is today and where they aim to be in future. Yet, a defining weakness of plans is they’re conceived in a world that’s unlike the one that unfolds. Think of the expensive and time-consuming ‘strategic plans’ made in the northern winters of 2019 and 2021 that were redundant by the time spring came round. But the draining process and exorbitant cost of making detailed ‘annual strategic plans’ meant few organisations were willing or able to revise their thinking in time. They were left with a choice: Abandon their plan or ‘double down’ on it. Many chose the later — making a virtue of ‘sticking to the plan’ — but this meant acting like a chess player sticking to a pre-determined series of moves while ignoring how the situation on the board was unfolding. Such single-minded stubbornness can be very costly.
Weiqi eschews the single-mindedness of chess. As each stone is placed on the board multiple situations wax and wane in importance. Focusing on one area of the board, to the exclusion of others, is detrimental to the strategic flexibility needed to cultivate winning potential. Weiqi players therefore focus on multiple wheres — exploring opportunities and threats across the entire board. This is the approach to strategy that took root in the East — it is one that ‘distrusts a single strategy that focuses attention on one situation at the expense of others’ — and explains Honda’s seemingly cavalier approach to entering the US market with ‘no strategy other than seeing if they could sell something’. It was their aversion to focusing on a singular where — a rigid, singular aim — that gave them the strategic flexibility to adapt when their situation changed in unexpected ways.[12] This rejection of singular wheres also explains why Fujifilm — responding to the rapid decline of their core market — sought out multiple markets to attack.[13] Unlike their US rival, Kodak — whose singular focus on digital cameras failed to save them from bankruptcy — Fujifilm’s focus on multiple wheres enabled them to cultivate the potential needed to not only survive a crisis, but thrive.
Fig.20: Multiple wheres in play on a weiqi board
Focusing on a singular where — a single aim — is a risk no strategist can afford to take. Detailed plans created to deliver a set outcome may provide a comforting sense of certainty and control but, as both Clausewitz and Sun Tzu highlighted, this is illusory in a world that is rife with uncertainty. Yet it was only Sun Tzu who argued that one doesn’t need certainty in order to act effectively — one simply needs to be less uncertain than ones rivals and exploit the subsequent mismatch. We achieve this by making orthodox moves that develop our capabilities to adapt to “shifting conditions and circumstances in a world where chance, uncertainty and ambiguity dominate”[14], whilst simultaneously making unorthodox moves that confuse our rivals and add to their uncertainty — diminishing their ability to adapt and thereby creating a relative advantage over them. This is why a “prescribed plan and action are the last things a general should seek in warfare”[15] or an executive should seek in business. Plans create the temptation to only see the world as we’re trying to make it be, rather than how it really is. When situations shift we may mistakenly ‘double-down’ on these illusions due to a misdirected Clausewitzian determination to ‘see it through’. Slowly we divorce ourselves from reality and become increasingly vulnerable to attacks from more skilful rivals. It’s why “nothing is more dangerous than becoming immobilised” by a rigid plan — a singular where — that can “make conduct inflexible and prevent an actor from the variation from which all potential stems”[16].
Difference #3: Natural Genius vs. Genius Nurtured
“As a prolonged and complex game, Go players focus on building or creating rather than chess players’ emphases on removal and destruction”.[17]
Clausewitz made strategy in the West “an activity in its own right, separate from politics”[18] and this led to strategy becoming an ‘art-form’ practiced in isolation from any concerns about implementation. The subsequent division of many western organisations into ‘thinkers’ (who make plans) and ‘doers’ (who implement plans) therefore feels natural to many — after all, we “have heads with which to think and bodies with which to act” — and this orthodoxy has become “so deeply rooted in the very philosophical basis of western society that it seems indisputable”.[19] The separation of ‘strategy creation’ from ‘strategy execution’ has also given rise to an “industry [of] management consultants, strategic planning staffs, and business school academics”[20] that have grown up around businesses in the West and to whom many outsource their thinking on complex challenges — such as adopting new technologies, developing new products, or entering new markets. For such challenges are fraught with uncertainty and seeking the counsel of ‘strategic geniuses’ — those thought able to peer through the ‘fog’ and identify the ‘decisive point’ the organisation needs to focus on in order to succeed — is considered a smart course of action that many leaders choose to take.
Whenever the plans of ‘thinkers’ fail the blame is laid at the door of the ‘doers’ for poor execution, (as shown in the case of Hewlett-Packard earlier).[21] But any plan that can be derailed by poor execution could not have been much of a plan to begin with as “every failure of implementation is, by definition, also a failure of formulation”.[22] Yet the elevation of the ‘strategic genius’ (despite this concept remaining a ‘black box’ in western thinking) usually renders them immune to criticism. The more their plans fail the more the organisation looks internally at what its ‘doers’ did wrong. In fact, these same thinkers are often asked to remedy the ‘execution gap’ that’s been exposed and so another single-action remedy, like a cultural or agile transformation, is proposed, sold and launched. The beneficiary of these remedies is rarely the organisation paying for it (and certainty not the ‘doers’ whose time is often wasted by yet another large initiative) but the management consulting industry itself who promise that they will, finally, make your ‘doers’ capable of implementing the great plans these ‘thinkers’ have devised for them.
Unlike the West, strategy in the East was not seen as a separate activity but as part of the entire affairs of state incorporating the political, diplomatic and logistical fields. Strategy is not limited to achieving victory on (or before) a battlefield, it is concerned with the aftermath of war as well. “In this broad framework, the art of war is, in essence, the process of diplomacy”.[23] Strategy in the East became an integral part of what everyone should be doing, requiring a ‘whole of board’ focus. People must explore moves they should make (seizing opportunities, guarding against threats) but also be aware of how capable they are of making such moves. This is why Fujifilm’s CEO warned his people ‘not to rely on outside consultants’[24] as strategy can not be outsourced to others, it must come from within. This requires an organisation with frontline people who can both ‘think’ and ‘do’ so they respond in a timely and effective manner to changing conditions, like the Honda executives who beat the British in the US motorcycle market by learning and exploiting emerging opportunities more quickly and effectively than their rivals.[25]
This is where the “ancient Chinese notion of genius [is] at odds with Clausewitzian genius”.[26] In the eastern tradition ‘genius’ is meant to be ‘teachable’. Sun Tzu’s ‘Five Factors’[27] — purpose, climate, the terrain, commands and regulations — is a framework for teasing victory from conditions and is learnable to anyone. Victory comes from developing better awareness about the current situation and making moves so you adapt to changing conditions better. Awareness-adaptiveness therefore are the mutually reinforcing capabilities that develop cultivate superior potential. And, when the timing is right, one unleashes this potential in an unstoppable torrent, impossible to resist. Effective strategy is not a singular plan conceived of in advance by a ‘strategic genius’ possessing other-worldly insight and determination. Effective strategies are multiple, next-best moves made by frontline people responding to challenges and opportunities they face in ever-evolving conditions. What looks like a plan only emerges in hindsight.
A “new” approach strategy for an uncertain world
The Russian-British theorist and historian Isiah Berlin famously made a distinction between hedgehogs and foxes[28]: Hedgehogs, he argued, are those who know and do one big thing; while foxes are those who know and do many small things. Western strategists, culturally shaped by the work of Clausewitz, are akin to hedgehogs: They seek to identify a single ‘decisive point’ to attack and create a plan of action to bring all their acquired power into play, while displaying the rugged determination needed to carry the day. Eastern strategists, shaped by the influence of Sun Tzu, are more akin to foxes: Opportunists actively seeking to learn how situations are evolving rather than relying on a pre-conceived plan. They know that business, like war, is a ‘democratic game’ as other players have a large say in how conditions will unfold, so they focus on active problem-solving (and active problem-making for rivals) and adapt as they go.
Understanding the eastern approach to strategy — awareness and adaptiveness, orthodox and unorthodox, cultivating potential — doesn’t come naturally to those versed in western approaches. Yet, the Art of War provides an elegant framework for making ‘strategic masters’ of us all — contradicting the western idea that ‘strategic genius’ is something you are either born with or not. Sun Tzu’s message is one of democratising strategy — providing a path to strategic brilliance that each of us can develop by learning how to harness the potential in the conditions around us. Knowing these ‘Five Factors’ can help you make moves that can be as powerful as a river racing down a mountain, “capable of arriving [at the sea] at multiple and thus interchangeable outcomes”[29] — impossible to resist. The next book therefore will start exploring these factors in the context of the modern business world, laying out a path to strategic mastery.
1 On China. Kissinger (2011) p45
2 On China. Kissinger (2011) p47
3 Learning from the Stones: A Go Approach to Mastering China’s Strategic Concept, Shi. David Lai (2004) p.28
4 Science, Strategy and War: The Strategic Theory of John Boyd. Frans P.B. Osinga (2007) p.311
5 Military Power. Biddle, S. (2004) p63
6 We will explore the idea of one of these, John Boyd, in depth in the final book.
7 A Treatise on Efficacy. Jullien. (2004) p177
8 DaoDe Ching (chapter 57)
9 https://victorhanson.com/the-lessons-of-wellington/
10 Learning from the Stones: A Go Approach to Mastering China’s Strategic Concept, Shi. David Lai (2004) p.28
11 Learning from the Stones: A Go Approach to Mastering China’s Strategic Concept, Shi. David Lai (2004) p.28
12 See chapter 6.
13 See chapter 5.
14 Science, Strategy and War: The Strategic Theory of John Boyd (Strategy and History). Frans P.B. Osinga (2007) p45
15 Deciphering Sun Tzu. Derek M. C. Yuen (2014) p. 162
16 The Mind of War. Hammond p198 quoted in Deciphering Sun Tzu. Derek M. C. Yuen (2014) p. 89
17 Learning from the Stones: A Go Approach to Mastering China’s Strategic Concept, Shi. David Lai (2004) pp.28–9
18 On China. Kissinger (2011) p.48
19 Rise and Fall of Strategic Planning. Henry Mintzberg (1994) p406
20 The Honda Effect. R.Pascale. (1996) California Management Review, Vol 38, №4 p80
21 See chapter 1.
22 Rise and Fall of Strategic Planning. Henry Mintzberg (1994) p59
23 Learning from the Stones: A Go Approach to Mastering China’s Strategic Concept, Shi. David Lai (2004) p.3
24 See chapter 5
25 See chapter 7
26 The idea of genius in Clausewitz and Sun Tzu. Lukas Milevski (2019) https://www.tandfonline.com/doi/full/10.1080/01495933.2019.1573076
27 See chapter 8
28 https://www.amazon.com/Hedgehog-Fox-Tolstoys-History-Second/dp/069115600X
29 Deciphering Sun Tzu. Derek M. C. Yuen. (2014) p. 82
Introduction to Book One — Why Best Practices Are Holding You Back
Chapter 1 — Forget Strategic Plans!
Chapter 3 — Pal’chinskii’s Principles
Chapter 4 — Ashby’s Law of Requisite Variety
Chapter 5 — FujiFilm: Innovating Out of a Crisis
Chapter 6 — Honda B: Miscalculations and Mistakes
Chapter 7 — Honda-Yamaha War of Natural Selection
Chapter 8 — The Eastern Approach to Strategy
Chapter 9 — The Western Approach to Strategy
