Tuesday, October 28, 2008

Operating from a Position of Strategic Advantage

One of the most popular Chinese Strategy Classics is the 36 Stratagems. This essay focuses on
six categories of strategies that are based on the positions of all competitors

When one's has the advantage of time and resources, the professional strategist does not rush into the situation. He builds a detailed plan and uses the approach of "Advantageous Strategems".

"Conserving energy while the enemy tires himself out" (以逸待劳 or "Yi Yi Dai Lao")
It is an advantage to choose the time and place for battle. In this way you know when and where the battle will take place, while your opposition does not. When the opposition has expend their energy in futile quests while you conserve your strength. When he is exhausted and confused, you attack with energy and purpose.

"Looting a house on fire" (趁火打劫 or "Chen Huo Da Jie")
When a company is beset by internal conflicts, they are not able to deal with an outside threat. This is the time for the superior company to attack.


Big tech goes bargain hunting
If you're a corporate giant with billions in cash, there's good news in the fear spreading around Silicon Valley. All those startups with technology you coveted? Fire sale!!!
By Michael V. Copeland, senior writer
October 28, 2008: 6:14 AM ET

(Fortune Magazine) -- These are the days that bring out the power shopper in Larry Ellison. With so much chaos in the markets and panic in the boardrooms, the Oracle CEO sees right now as a fine time to stroll through Silicon Valley and buy pretty much whatever he wants.

"We are better positioned than our peers to do well in tough times," Ellison declared at Oracle's annual meeting in October. "Acquisitions we have been looking at for some time are more attractive."

He's not talking about buying anything with stock. Like every tech company's shares, ORCL has been clobbered - it's down 22% since January, compared with -36% for the Nasdaq. No, he's talking about cash. Oracle (ORCL, Fortune 500) has $13 billion - and Ellison is ready to spend. Some of that money will be deployed to repurchase Oracle shares. (The company's board recently approved a stock buyback of up to $9.3 billion.) But Ellison said at the annual meeting that he planned on keeping up his 12-company-a-year buying habit.

What's he feeding on? A diet of "small companies that are fast-growing," though he doesn't rule out big purchases. Two days before his speech, as markets were melting, Ellison put down an estimated $300 million to buy Primavera Software, a privately held project-management technology company.

Ellison, of course, isn't the only tech potentate sitting on a pile of cash. Cisco (CSCO, Fortune 500)'s John Chambers, HP (HPQ, Fortune 500)'s Mark Hurd, Microsoft (MSFT, Fortune 500)'s Steve Ballmer, and Google (GOOG, Fortune 500)'s Eric Schmidt, among others, all have billions at their disposal. Even the normally purchase-resistant Steve Jobs sounded a bit acquisitive during Apple's recent earnings conference call. (Other big tech names may not join in the shopping spree - Sun Microsystems (JAVA, Fortune 500) and Yahoo come to mind, both of which have had serious sales declines. IBM is still growing revenues and has cash, but it's also carrying $34.4 billion in debt.)

So who's going to get bought? For now, the quarry seems to be small private outfits with technology the big guys covet. Recent examples: HP's purchase of storage startup Lefthand Networks for $360 million; Intel's acquisition of networking-gear maker NetEffect for $8 million.

"The deal flow is as busy as I've seen it," says Michael Barker, managing director with Revolution Partners, a boutique investment bank. "Sure, you have some VCs who think their zero-revenue social-networking company is still worth $500 million, but mostly they understand that prices are coming down. If you are a buyer, you have carte blanche."

If you are a seller, you are over a barrel. VCs are loath to sell their best companies now, because they know it's a buyer's market. "In this environment it turns into a fire sale," says Jason Green, a VC with Emergence Capital, based in San Mateo, Calif. But those sales are happening anyway, as VCs comb through portfolios deciding which companies to hang on to and which to let go.

Two types of companies are destined for the sales bin. Type one: startups without revenue that will soon need another round of financing just to get by. Any number of the dozens of Internet video startups that launched in the past two years fall into that category.

Type two: later-stage companies with big burn rates that have been hoping to go public. Just scan the tech companies withdrawing IPOs, such as content-delivery company Synacor and software maker Varolii, for example. With both types of companies, the money they and their VCs were banking on has been squeezed off, so selling for cheap might be the only option.

Even facing that pain, there is no lack of sellers, says Ned Hooper, Cisco's head dealmaker. Hooper led Cisco's purchases of WebEx (online conferencing service) and IronPort (security software). And Cisco, which has a Valley-leading $26.2 billion in cash, is in the market for more.

Before 10 o'clock one recent morning, Hooper already had three eager bankers dial him up. He says recent calls tend to start the same way: "Hey, Ned it's been a while. I've got a great idea I want to run by you." Then they talk about Cisco buying their company. "If it's not nailed down, it's for sale," Hooper says. "It hasn't been like this since 2001."

Cisco has always been a buyer, in good times and bad, but it likes picking up companies during downturns, after they've had to learn some financial discipline. Hooper says that any purchase Cisco makes will have to be strategic (translation: add revenue). That, more than price, will determine Cisco's level of interest. "If you are three months from raising a round of financing and it's clear that is why you are selling, don't come to us," Hooper says. "We are not the buyer of last resort."

What's clear is that after several years of paying up for tech companies - of being forced into bidding wars with massive private equity shops and hedge funds dabbling in venture capital - the Valley's big tech leaders are glad to be back in demand and in control of the deals.

Case in point: Dan Warmenhoven, CEO of data-storage company Network Appliance. Over lunch in San Francisco recently, Warmenhoven clearly enjoys his fish and chips about as much as he relishes his new position of strength. NetApp may not have the massive coffers of Cisco, but Warmenhoven has $2.1 billion in cash at the ready.

He says he wouldn't mind picking up "something that adds to our toolkit." Like what? "Technology that would have cost me $100 million a year ago but might go for $11 million today. Deals like that." He checks a burst of incoming messages on his BlackBerry and says with a grin, "Look, the offers are coming in right now."


Monday, October 27, 2008

Preparation Precedes Performance

If you are prepared properly, you can create opportunities within the sphere of your opposition..

"... When the army has penetrated deep into hostile territory, leaving far behind many enemy cities and towns, it is in serious ground. ... In serious ground I would ensure a continuous flow of provisions. ... Take advantage of the enemy's unpreparedness; travel by unexpected routes and strike him where he has taken no precautions. ... Speed is the essence of war. Take advantage of the enemy's unpreparedness; travel by unexpected routes and strike him where he has taken no precautions. ..." --- Sunzi Art of War Chapter 11

October 26, 2008
So Spread Out, So Hard to Catch

TULSA, Okla. When Rice Coach David Bailiff prepared for Tulsa’s fast-paced no-huddle, spread offense, he noticed that the videotapes had recorded some of the action in midplay.

He wondered if the missing tape was a bit of gamesmanship. That was until his team lost, 63-28. Not only could Rice not keep up with Tulsa on the field, but the Owls’ video staff also could not keep up with recording the Golden Hurricane’s offense.

You think they’re starting their camera late, Bailiff said in a telephone interview, but then you realize that’s just how fast they’re going.

All season, opponents have been playing catch-up to No. 22 Tulsa (7-0, 4-0 Conference USA) and its offense, which entered the weekend ranked first in total offense (624.7 yards a game) and scoring (56.6) in the Football Bowl Subdivision.

In his first season as a starter, the fifth-year senior quarterback David Johnson has blossomed into a stealth Heisman Trophy contender and thrown for 2,397 yards. He led the nation in touchdown passes (31) and passing efficiency (212.8).

Under the energetic second-year coach Todd Graham, Tulsa could be on the verge of crashing the Bowl Championship Series, despite having the smallest enrollment of any top-division member (4,165). Entering Sunday’s home game against Central Florida, Tulsa is ranked No. 19 in the B.C.S. standings and is halfway to its goal of posting a 14-0 record and winning the Orange Bowl for the first time since 1945.

I’m going to have to study his offense and see what new wrinkles that we can put in, said Michigan Coach Rich Rodriguez, a spread-offense guru, for whom Graham used to work as a defensive assistant at West Virginia.

Of Tulsa’s remaining regular-season opponents, only Houston entered Saturday with a winning record. Tulsa’s toughest challenge could be at Arkansas on Nov. 1.

But that is only if the Razorbacks can figure out how to slow the Golden Hurricane offense, which tries to snap the ball in the first 10 seconds of the 40-second play clock. Tulsa has outscored their opponents by an average of 56.6 to 27.1 this season.

It just feels like the opposing teams have no chance, the senior wide receiver Brennan Marion said.

The up-tempo offense
, which Central Arkansas Coach Clint Conque called smoke and mirrors after losing to Tulsa last month, causes alignment mistakes and fatigue among defenses. The hectic offense has been known to leave opposing players gasping for breath. Tulsa has outscored opponents by 302-118 after the first quarter.

They have the fastest-paced offense I’ve ever seen, said Bailiff, a 27-year coaching veteran.

Tulsa’s dynamism can be traced to Graham, who was hired in 2007 after he coached Rice to its first bowl in 45 years in his lone season there. Before that, he was the Golden Hurricane’s defensive coordinator for three seasons under Steve Kragthorpe, who left for Louisville in 2007.

A plastic orange with 14-0 written on it and a Bible turned to Psalms sat on a desk in Graham’s office, and The Art of War was in a bookcase.

Graham, the son of a single mother with an eighth-grade education who raised five children, arrives for work at 6 a.m. daily, and sleeps twice a week in his office on a blue air mattress that his wife bought. He makes his secretaries answer the telephone, University of Tulsa, home of the champions.

His players often tease him for his telling them to do a handspring out of bed in the morning to ensure a positive attitude.

I’m fired up to be doing this, said Graham, 43, who has six children. Can you believe I get paid to do this? It’s a great job. I don’t want to be around the fellowship of the miserable. I am jacked that I get to work.

But even though Graham had recruited many of Tulsa’s players during his first stint with the team, they seemed unsure about his boundless enthusiasm when he returned.

In his first team meeting after being introduced as that coach, Graham stated that his goals for last season were a 14-0 record and an Orange Bowl victory. His words were met with awkward silence.

We were like: ‘This guy is crazy,’ the senior offensive tackle Rodrick Thomas said. ‘He’s rambling. He’s way too ecstatic and needs to calm down.’

With the innovative Gus Malzahn as a co-offensive coordinator, Tulsa led the nation in total offense at 543.9 yards a game last season. It also became the first team with a 5,000-yard passer, three 1,000-yard receivers and a 1,000-yard running back in N.C.A.A. history.

But instead of playing in the Orange Bowl, the Golden Hurricane whipped Bowling Green, 63-7, in the GMAC Bowl to finish 10-4.

Undeterred, Graham announced in a team meeting in January that his goals for this season were again a 14-0 record and an Orange Bowl victory. This time, his players nodded in agreement. As a reminder, the trophies from the university’s 1945 Orange Bowl and 2005 Conference USA championship were placed on the field during every off-season workout.

We bought in this year, Thomas said.

As chaotic as Tulsa’s offense looks, there is logic to it. Malzahn is required to design a game plan within Graham’s parameters, which are based on his 22 years of coaching defense.

If I just let him do whatever he wanted to, he’d throw the ball every play, Graham said of Malzahn, who had previously been Arkansas’s offensive coordinator.

Graham, who is sure to be mentioned for prominent coaching jobs after this season, requires establishing the run to set up play-action passing. Ideally, he wants an equal mix of passing and rushing plays.

Graham also mandates multiple formations with simplicity in plays, sets with multiple tight ends, the option and even the triple option out of the shotgun, as well as misdirection in rushing and passing. He also demands five plays a quarter to throw the ball deep outside the hash marks and continual changes in the spacing in formations.

We basically run on offense everything I hate to defend, Graham said. We’re going to be in the left lane, man. We ain’t in the right lane. We’re in the left lane, hammered down.

Even Johnson occasionally seems to marvel at the offense.

There’s a lot of stuff that I’ve never seen before, said Johnson, whose only major scholarship offer was from Tulsa. I don’t even how it’s going to work sometimes, but then it does. It’s just crazy.

Despite the lack of national attention relative to their ranking, Johnson and his teammates hardly seem to mind. He just seems glad that Tulsa is finally getting respect locally.

At a recent home game, Johnson recalled not seeing fans in the stands wearing Oklahoma and Oklahoma State apparel for the first time in his career.

As we keep winning, our sphere of influence is getting bigger, he said.

Trying to catch them, either on tape or on the field, is the challenge.

Copyright 2008 The New York Times Company



If you want your project team to maneuver like this, contact us at service[aatt]collaboration360[dott]com. We believe we can help you

Sunday, October 26, 2008

New Strategy Discussion Group Starting Soon

An associate will be starting an on-line strategy discussion group. It will cover serious strategy topics like Sunzi's Art of War, Jiang Tai Gong's Six Strategies, 100 Unorthodox Strategies, Dao De Jing, Game Theory, etc.

This group is designated for serious professionals who read and practice Chinese strategies 7/24.

The C360 group will be participating in this group. More on this group later in November.

The person responsible for this discussion group, will be sending e-vites soon.
If you are interested, please leave us your name, e-mail address and something about yourself and your interest in the art and science of strategy. We will direct your interest to the forum leader. You can e-mail the information at service(aatt)collaboration360(dott)com.


Sunday, October 19, 2008

Best Practices of Desktop Strategists

What are the Best Practices for most Desktop Strategists?
  • Use a standing table for planning and strategy development;
  • Read Sun Tzu's AoW and other Chinese strategy classics before game preparation or game time;
  • Use mind maps to secure an eagle-eye view;

  • Listen to Mozart and Bach Music while working

  • Understand the basics of project management. (There are some so-called strategists who do not know how to define milestones and organize project activities.)
  • Always focus on getting an eagle-eye view.

Wednesday, October 15, 2008

New Application for the C360 Strategic Assessment Process

Was working with a potential client. We showed him how to use our strategic assessment process for intelligence gathering.

While the grand process is the same but the operational process is quite different.

If you are interested in this topic, contact us at service(aatt)collaboration360(ddoottt)com

Sunday, October 12, 2008

An Endorsement for Our Strategic Assessment Process from Roger Ames

"a very contemporary, very intelligent application of Sunzi."
-- Dr. Roger T. Ames, author of Sun Tzu: The Art of Warfare and
Sun Pin: The Art of Warfare

Roger T. Ames is a Professor of Philosophy and the Director of the Center for Chinese Studies at the University of Hawaii. He is the editor of the journal Philosophy East & West.

Copyright: 2008 © Collaboration360 Consultants (C360 Consultants).
Copying, posting and reproduction in any form
(without prior consent) is an infringement of copyright

Sunday, October 5, 2008

A Page from the Strategic Assessment Book

Copyright: 2008 © Collaboration360 Consultants (C360 Consultants).
Copying, posting and reproduction in any form
(without prior consent) is an infringement of copyright

Each and every week, we will publish a page or two from the book. Appreciate your feedback.

Any questions on our Strategic Assessment process, you can contact us at service [at] collaboration360 [dot] com.


M.E. Hom
Chief Architect of Collaboration360.com