Category: Strategy

Lacking Costs & Decision-Support,, Brilliant in All Other Respects

June 30, 2007

Bob de Wit

I have left this book at five stars despite its lack of a focus on the totality of the costs picture, and the urgency of decision-support, because I want to cross-fertilize this book into the national, military, and law enforcement strategic regimes (largely non-existent, hence the need), and I consider it to be world-class in all that it presents.

First the gaps: neither “costs” nor “intelligence” (nor “decision-support” appear in the index to this book, which is both a commentary on the content, and a commentary on the index, since I do see the words elsewhere in the book.

“True costs” or “natural capitalism” is emerging as the single most important strategic concept for both political and business leaders. Up to this point corporations have been allowed to privatize profit and externalize the bulk of their “true costs” to the individual taxpayer. That is coming to an end. The public now has a digital memory, the World Index of Social and Environmental Responsibility (WISER) is calculating and posting the true cost of everything (e.g. a T-Shirt from Bangladesh has 4,000 liters of virtual water they do not have to export), and Amazon is positioning itself to provide point of sale “true cost” to the individual buyer via cell phone scan back on the bar code: water, fuel, sweatshop, and tax avoidance content at the point of sale. Revolutionary. It will change the marketplace and who wins, who loses in business, nearly overnight (ten years).

On decision-support, other than refer to my short list of a handful of really important commercial intelligence guides, I will simply note that Ben Gilad, one of perhaps ten really great international commercial intelligence practitioners, says in his first seminal work, “Business Blindspots: Replacing Myths, Beliefs, and Assumptions with Market Realities (Infonortics UK, 1996) that:

“Top managers' information is invariably either biased, subjective, filtered, or late.”

This tallies nicely with my own findings over a 30 year career in national and military intelligence: Washinton, certainly, London, Paris, Beijing, and other capitals probably, are operating on 2% of the relevant information. They are ignoring 95% of the information that is not secret, not online, not in their language, and not being collected by either their intelligence agencies or their Cabinet departments, which specialize in staffing stakeholder policies divorced from reality and focused on grabbing budget share.

It merits comment that this book comes to us from The Netherlands, the unheralded owner of much of US real-estate and much of the world's structured knowledge. Consequently, the authors are not suffering from American naivete, they have avoided the traditional shortcomings of most textbooks in English (myopia, avoidance of complexity, generic presentation from one author) *and* they fully int3egrate the vital importance of understanding cross-cultural differences, the international context, and the value of international cases that do NOT follow normal US “rules of the game” including authorized “reasonable dishonesty.”

This book a monster at 950+ pages, is of great value to non-business strategists, the few that are emergent, and below I list some other relevant books from the national side that may be helpful to business leaders and academic theorist-practioners.

I am creating and loading an image of their Figure 1.6 on Strategy topics, paradoxes, and perspectives because in that one image they capture the enormous value of their book and their process. For that image, and the first half of the book on the process, this is a very high value acquisition worthy of deep study.

Other strategic books that I favor, in relative order of importance:
Modern Strategy
Strategy: The Logic of War and Peace, Revised and Enlarged Edition
Strategy: Second Revised Edition (Meridian)
The Art of War by Sun Tzu – Special Edition
Boyd: The Fighter Pilot Who Changed the Art of War
High Noon 20 Global Problems, 20 Years to Solve Them
Blessed Unrest: How the Largest Movement in the World Came into Being and Why No One Saw It Coming
Ecological Economics: Principles And Applications
The New Craft of Intelligence: Personal, Public, & Political–Citizen's Action Handbook for Fighting Terrorism, Genocide, Disease, Toxic Bombs, & Corruption
Preparing America's Foreign Policy for the 21st Century

Unforutnately, some of the best books, such as “The Art and Practice of Military Strategy” edited by George Thibault, are published by the National Defense University in limited edition and not listed on Amazon nor available for purchase via normal channels. This is a useful illustration of the concept of “gray literature”: very often the most important information is freely available, but not through the traditional channels. The height of strategy, apart from knowing yourself and not wearing blinders, is to know all that can be known about your environment and the other players, not just that which is convenient to know, or that your generally self-preserving subordinates want you to know.