Skip to 0 minutes and 11 secondsThe Art of War, one of the oldest military manuals written by the Chinese general Sun Tzu in the year 400 – 320 BC. Great generals and top CEOs have one wish in common, they both look for territories or in business terminology, market share and according to Sun Tzu’s manual, an army should not go to war unless it is certain it has an advantage over the enemy. This famous quote from Sun Tzu can be construed in business vocabulary as, management should not only know their internal capability but also the resources and competences of their competitors. The great Chinese general and warrior Sun Tzu further expands, a territory must be conquered as quickly as possible and unnecessary bloodshed should be avoided.

Skip to 1 minute and 13 secondsSo, the lesson for the top business managers is, management should always avoid unnecessary waste of their time and resources.

Sun Tzu: the battle for competitive advantage

In this video, Ali Ehsan draws parallels between Sun Tzu’s Art of War and the boardroom. Top CEOs, like successful generals, are looking to increase their territories or – in business terminology – market share.

With the increased integration of markets in the global economy, however, sustaining competitive advantage over the long term has become much harder for businesses, as the competition is adapting quickly and closing in at a fast pace.

CEOs and their teams find themselves on a continual learning curve, setting new rules to try to maintain their lead. They have learned to be flexible and adapt to consistent market changes without conceding advantage, trying to stay a step ahead of the competition by improving their core competencies.

Regular benchmarking of best practices gives firms short-term advantages in the areas of effectiveness, design, production, sales and delivery. However, this is no longer sufficient to sustain the competitive edge as others might achieve the same productivity in a short space of time and take the lead position.

Strategic positioning is a company’s attempt to preserve their unique qualities while introducing new operational activities or performing existing activities using new methods.

Your task

Can you think of any companies that have strategically re-positioned themselves in order to strengthen their place in the global economy?

Share your examples with fellow learners.

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This video is from the free online course:

Macro Environmental Analysis and Business Strategy: An Introduction

Coventry University