Certain To Win

Chet Richards book Certain to Win: The Strategy of John Boyd, Applied to Business ISBN:1413453767

• cf OODA, Strategic Agility
• http://www.dnipogo.org/richards/ctw.htm
• Table of Contents http://www.dnipogo.org/richards/table-of-contents.htm
• http://venturehacks.com/articles/certain-to-win

Excerpts

CHAPTER I: Nor the Battle to the Strong

Why Study War?

“Much strategy,” ancient commentators wrote, “triumphs over little.”5 You would be hard put to demonstrate this by looking at business strategy today. That phrase can mean almost anything

One problem may be that some who study military strategy fail to deal with the nature of business

I propose to resurrect business strategy by returning to a form of conflict that is simpler in the abstract, war.

War strategies, however, rest on a deeper foundation of people working together under stress and uncertainty, and good ones shape the terms of the conflict to their liking before combat begins

The Blitzkrieg

CHAPTER II: Visible Figures Alone

CHAPTER III: Sting Like a Bee

Why Some Sides Always Seem to Win

John Boyd was famous for browbeating his audiences with the mantra, “People, ideas, and hardware—in that order!”

The reason for this reversal, in business and in war, appears to be that these smaller organizations were able to avoid or negate the larger’s advantages in size and strength. Somehow they had managed not to become systems in the eyes of their larger opponents. This might lead one to suspect that in any competitive endeavor, if you can be modeled (“sand-tabled,” as Boyd referred to it) you aren’t using strategy at all, and you can be defeated.

Key Attributes of the Blitzkrieg

Blitzkrieg strategies do not aim to execute the same maneuvers as other forms of warfare, such as charging across no man’s land, only more quickly

talk at length with many of the practitioners of the Blitzkrieg. Amidst all the war stories, a pattern became clear: The roots of success in 1940 lay in the German system for dealing with people; it was cultural, rather than technical. Here, I am using “cultural” in the sense of “business Culture,”

Boyd extracted the four concepts shown below as the primary reasons for the Germans’ success

Key Attributes of the Blitzkrieg • Einheit: Mutual trust, unity, and cohesion • Fingerspitzengefühl: Intuitive feel, especially for complex and potentially chaotic situations • Auftragstaktik: Mission, generally considered as a contract between superior and subordinate • Schwerpunkt: Any concept that provides focus and direction to the operation.

Einheit: Mutual Trust

Schwerpunkt: Focus and Direction

main focus

The distinguishing characteristic of an effective focus is that all other activities of the organization must support it and that the people conducting these activities understand what the main effort is and know that they must support it. Conversely, subordinates are expected to use their own initiatives to exploit opportunities, even if it means setting aside a previously issued order, whenever they can further the accomplishment of the focusing-and-directing mission

CHAPTER IV: What Strategy Is and What It Can Do for You

Why Strategy?

On Your Own Terms

When discussing the notion of grand strategy, Boyd concluded that: What is needed is a vision rooted in human nature so noble, so attractive that it not only attracts the uncommitted and magnifies the spirit and strength of its adherents, but also undermines the dedication and determination of any competitors or adversaries

Goals and Visions

These higher purposes are sometimes called “overarching goals”97 or “unifying vision”98 . Some businesses have this sense of purpose

There is a risk in all this. You are not the church or the Red Cross or even the government. Your purpose as a business is not to bring enlightenment to humanity but to, as Toyota puts it, “take our destiny into our own hands.” It is hypocritical to pretend otherwise

Boyd’s climate contains an element, the Schwerpunkt (focus and direction) that companies can employ to gain the benefits of “vision.” They should just go easy on the saccharine “vision statement.”

Strategy

Once we have an idea of where we want to go, we can talk about a strategy to get us there

every strategist should collect definitions

Strategies and Plans

plans are poor tools for dealing with uncertainty, ambiguity, and confusion

Plans are what we intend to do to get from Now to where we want to be in the Future. To build a specific a plan, we have to make assumptions about what the future will bring. In other words, we have to construct a scenario

In real life, unpredictable actions by customers and competitors ensure that things don’t often work out exactly according to plan.

Therefore, we might consider an alternative scenario, and an associated (back-up) Plan B

Similarly, we might have alternative goals, Future1, Future2, Future3

If you keep this process up, you will discover two things. First, you will spend a lot of time trying to map out the future

There is a way to preserve the benefits of planning while avoiding the prophetic nature and the complexity of formal decision models and which will also help you exploit the chaos of the real world. You can use strategy to give this process a shape that the human mind can work with. What type of strategy will do this? The basic idea revolves around the notion of “focus and direction”

Strategy, then, includes selecting the view of the future we want, creating devices to harmonize all the plans and actions designed to achieve that future, and on relatively rare occasions, shifting to an alternate future

A Definition

then we have Boyd’s definition:

Strategy is a mental tapestry of changing intentions for harmonizing and focusing our efforts as a basis for realizing some aim or purpose in an unfolding and often unforeseen world of many bewildering events and many contending interests.101

Creating Strategy

This raises the questions of how to create a strategy and what does the “tapestry” look like? This is not a “how-to” manual. In fact, even attempting to create a step-by-step approach would contribute to rigidity and defeat the real purpose of strategy

What a Business Strategy Should Do

Keep our focus on the customer, with an eye to the competition and the rest of the strategic environment

Provide our team with a continuing stream of options

A Concept of Strategy for Business

much of the Art of War concerns preparing a culture that is certain to win. Pre-war activities and decisions also form part of the level of conflict known as grand strategy—pumping up our morale and attracting the uncommitted to our side.

Since in business, “attraction” is the only tool we have to influence customers, there is no essential difference between “business strategy” and “business grand strategy.”

The Chinese, in their commentary on Sun Tzu, summarized the practice of strategy as a way to respond to changing conditions and create timely options. The strategy is in the responding and creating (what OODA loops do), and not in the options (e.g., plans & tactics) themselves

Armed with this view of strategy, a few military leaders began to explore alternatives that eventually led to the Blitzkrieg

A Strategy of Agility

Quick OODA loops will allow you to better track your environment

While these are effects of agility, they represent the passive component

To turn this into an active tool of strategy, you should ask yourself where these needs and wants come from. Too often they represent successful attempts by competitors to shape the marketplace

such “discovery of customer wants” does not provide the basis for strategy; it represents a failure of strategy.

Another reason why discovering customer “wants” may not generate much in the way of useful strategy is that what customers often want is magic

So in business, we look to agility to have a two-fold purpose: Keep the competition off balance while also leading both us and the customer into new ways of conceiving the product or service. This is what “shaping the marketplace” means

The best Japanese carmakers routinely use their superior OODA loop speeds both to find and to shape what customers really want, whether the customers know it or not. The Japanese even have a name for it: miryoku teki hinshitsu, which roughly translates as “What the customer finds so beguiling or fascinating that he cannot live without it.”105 It is an abrupt change in the customers’ attention, from the quality and value they expected to something special and delightful that took them by surprise

Notice that ‘shaping the market” is different from a “first mover advantage

Entropy and Other Strange Effects

There is a well-known name for this detachment from reality that strikes the less agile side: the fog of war

superior agility by one competitor magnifies friction in the slower side

How to Tell It’s Working in Business

Joseph Juran’s classic description of what happens to a company that is starting to lose: “Lacking victories over their competitors, and unable to defend themselves from their bosses, they lash out at each other, making unity of purpose even harder to achieve

Your competitor

becomes even more “Theory X,” instituting rigid, explicit controls,

Some Strategic Traps

Another, and more insidious strategic effect of complex methodologies is that they can turn the attention of the company inwards

Lessons Learned

Our last strategic trap

fighting the last war

Why did your product fail? In a way, it’s a fruitless question since most new products fail

CHAPTER V: A Climate for Winning in Business

Provide Focus and Direction

Goals

goals, as often as they are used, have their pros and cons

Goals, as we all know, can be motivators. Cypress Semiconductor, a communications-oriented company founded in 1982, used to have a computer that tracked the thousands of self-imposed goals that its people fed into the system. Cypress founder T. J. Rodgers identified this automated goal tending system as the heart of his management style and a big factor in the company’s early success

Frankly, I find this philosophy depressing, not to mention a temptation to focus inward

Rod Canion, founder of Compaq Computer Corporation, must have agreed, “We set directions rather than goals

There is no substitute for knowing what you’re doing. In business, numbers bounce up and down all the time

An Alternative to Goals

The subtitle of one of the few papers on the Toyota Development System reinforces this bias: “How delaying decisions can make better cars faster.”142 This is entirely consistent with the Schwerpunkt concept, where all activities must support the focus of effort, even if this means not (sub-) optimizing their own performance

Through their years of training and working together, the members of a well-functioning Toyota Production System facility have learned how to flow down the top level focus to the individual cells and other elements of the system in a way much more sophisticated than simply optimizing the performance of each

Flowdown

Can You Have More Than One?

in the Marine Corps, the commander designates one unit and its mission as the Schwerpunkt. As we have seen, all of the other units in that command must support the Schwerpunkt

In business, the situation is not so clear, since a focus will generally be a concept rather than a business unit

If there is no guiding concept for the whole operation, it becomes the job of top management to ensure that the focuses of the individual elements do not conflict. If this proves impossible, then management should divest or realign, based on the idea that the ultimate foundation for competitiveness is mutual trust, which is impossible to achieve in a company where units work at cross purposes

Schwerpunkt: Summary

It has to give real and actionable guidance in situations where there is no formal direction

It must contribute to an outward focus, towards the customer and the marketplace

How to Get It

When you are talking to people about what needs to be done, will they perceive a concept so simple and strong that it will motivate them and guide everything they do?

How to Kill It

To make the idea work, you will need a strongly developed intuitive competence for making these types of decisions. A good way to kill it, therefore, is simply not to use it, which guarantees that you will not develop the skill to use it.

A Graphical Representation

Pulling It All Together

One mechanism for achieving this harmony is known as Einsickern in German

The basic idea is to start a number of things going and reinforce the ones that succeed. This seems reasonable, but a closer look at its strategic roots suggests that it is not enough.

Typically in maneuver warfare, a commander will set out an aggressive reconnaissance, a strong force in front of the main body that probes and tests the enemy. When it finds or creates a gap, the units that are not in the reserve (which belongs to the commander and awaits his orders) will sense the new situation and begin to exploit in accordance with the commander’s intent. The Schwerpunkt has shifted, but in an implicit and organic way.

Implementing Boyd’s Organizational Climate

it will grow naturally if the senior management sets the proper conditions. He defines the two essential elements necessary for running any human organization along maneuver conflict—rapid OODA loop—lines as:

Leadership

Appreciation

during the appreciation phase, Balck was closely observing von Mellenthin, but was also careful not to influence von Mellenthin by even the smallest gesture. During the leadership phase, he was trying to ensure that he did influence von Mellenthin as strongly and as quickly as possible

The main idea of appreciation is to learn what’s really going on in your organization without causing the organization to react to your observing

Orientation, as Boyd insisted in all his briefings, is what guides and shapes the OODA loop. “Orientation is the Schwerpunkt,” he insists

Make implementing this culture the Schwerpunkt. This means that all the other activities of the company must support implementation. Personnel policies, outsourcing decisions, accounting methods—all activities must be evaluated not only on their own merits, but also on how they affect unity, cohesion, trust, mission concepts, intuitive competence, and so forth.

For a small company or team, it can be something as simple as gathering everybody together once a week for an hour to discuss and brainstorm these ideas. Place yourself at the Schwerpunkt of cultural change

How Long Will It Take?

it took 28 years (1945-1973) to create and install the Toyota Production System

It takes three years or so to earn a black belt (first degree) in the martial arts and four to six years beyond that to earn third degree

It is no less difficult to learn to fashion an elite, highly competitive company

CHAPTER VI: Surprise and Anticipation: The Real Principles of War, as Applied to Business

CHAPTER VII: What You Really Do with OODA Loops

We’re Not Holding Anything

One often reads that the purpose of quick OODA loop speed has to do with “responding rapidly to changing market conditions” or some such. If after reading this far you still have this notion, then I have failed. Boyd’s concept of strategy is vastly more powerful

With a strategy this powerful, your aim is not to respond to but to create the market conditions that you want

markets, like so many systems involving humans, are “complex

they are not predictable

Complex systems do exhibit patterns, however, and places like the Santa Fe Institute

A good place to start is Stephen Wolfram’s book, A New Kind of Science

I’ve Got It, Now What?

It depends on what type of conflict you want to shape

If your business involves manufacturing, use the Toyota Production System

There is also a Toyota Development System

To the best of my knowledge, these are the only three implementations of maneuver conflict principles so far

If your business does not fall into one of these categories, you will have to do some of the adapting yourself

Regardless of the specific business you are in, here are some ideas you may find useful

Keep Your Focus on Shaping the Marketplace

But You Probably Won’t Win Just by Doing the Same Old Things Better Than Everybody Else

Make Time the Focus

Growing Ideas

Tom Peters is, without any doubt, the management author most closely aligned with Boyd’s philosophy

One source of techniques applicable to industries outside the Toyota systems is James Womack’s and Daniel Jones’ Lean Thinking. It is a strange and difficult book, weak in terms of underlying strategy, but so full of ideas that everybody should study it.

The weakness in the book is that there is no recognition that the TPS is based on a deeper set of principles that do apply to other human activities

One book that does acknowledge that something basic forms the underpinning for competitive strategy is Competing Against Time, by George Stalk, Jr., and Tom Hout.

How Do We Know That It’s Working?

The most accurate indicator that you are starting to do maneuver conflict is that long established tradeoffs get broken

As Close As Can Be to a Formula

APPENDIX