Sun Tzu meets Michael Porter: Military Strategy vs Business Strategy

John Kay LSE

What are the similarities and differences between business strategy and military or geopolitical strategy?  This is the question John was invited to answer in a lecture at LSE on June 9th to a select audience, mainly of people involved in military and geopolitical strategy.

John agreed that all kinds of strategy are based on crafting a match between the capabilities of the organisation and the environment in which it operates.  However, picking up Sir Laurence Freedman’s definition of strategy is ‘the art of creating power’, John offered two alternative translations into business strategy – ‘the art of creating profit’ or ‘the art of creating value’.   Arguing for the latter, he suggested that power was in essence zero sum – one person’s gain was typically another’s loss.  But the success of one business in creating value was not to the detriment of others in creating value – although it might be to the detriment of their profit.

Teasing his politically-minded audience, John asked whether the economic definition might not also be more appropriate for the modern state, referring to his piece on ‘Denmark as No1’.

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