PROLOG

In the prior article titled “The Heart of the Matter” we had taken an internal look at the workings of our company in terms of mindfulness and our societal concerns. In this article we discuss Numorpho Cybernetic Systems’ (NUMO) proactive stance on our strategy for disruption, on how it is needed to let go of traditional concepts to build something in the new.

“To be born again, first you must die” is the famous statement in Salman Rushdie’s Satanic Verses where he contemplates the metaphorical changes needed for the redefinition of self. Similarly, a new business strategy in The Phoenix Encounter Method postulates to destroy part or all of the incumbent business model in order to build the next breakthrough, future-ready organization.

The aphorism for seize the day is part of the much longer “carpe diem, quam minimum credula postero”, which is often translated as “seize the day, put very little trust in tomorrow (the future)”. The ode says that the future is unforeseen and that one should not leave to chance future happenings, but rather one should do all one can today to make one’s future better. This is why folks typically embark on brownfield and greenfield initiatives to retrofit existing systems to the new. Not to downplay re-engineering, but we believe that for true disruption, bluesky thinking is needed as elucidated by Dr. V. “Paddy” Padmanabhan from the INSEAD Business School:

Our field research shows that 80% of executives fall into one or more of the following four segments of strategic leadership thinking: the complacent, the arrogant, the cautious and the overwhelmed. These types find handling or imagining disruption very difficult because they are stuck in the old traps of thinking and action that were encouraged and rewarded in their organizations. The unfortunate reality for these leaders is that they need to turn their mindsets and behaviors away from confirmation seeking and towards contradiction seeking. This is the hallmark of the fifth category of leaders we have seen in our research whom we call the dreamers and the doers. They are neither overzealous imagineers nor obsessive micromanagers. They are willing to envision a future where change is a constant and they know they do not have all the answers. They are explorers and navigators who are forward thinking, find uncertainty stimulating and outside viewpoints exciting. These are the leaders with the Phoenix Attitude.

This is an assimilation of concepts for Business Strategy gleaned from two philosophies: The Japanese Five Rings (Miyamoto Musashi), the Chinese Art of War (Sun Tzu) and a forward thinking model called the Phoenix Encounter Method that details a unique way for disruption and innovation. It will also define an operating model to follow thru three stages of creating a business anew, be it from scratch or rebuilding from total destruction.

In this article we will highlight the features of the two approaches to time tested battlefield tactics and where each one of them provides the right impetus. In summary, we will munge these two approaches together using the maturity stages detailed in the Phoenix Encounter method to provide a holistic approach to business strategy (called the Realm of Strategy) as a basis for a go-forward plan (a Modus Operandi) to enable the proper functioning of a business. Each aspect of the realm (the rhythm) will further be elaborated using the trigrams and hexagrams from the I Ching (Book of Changes) philosophy to effectively chart out the progression of the strategy through the stages of Groundwork, Battlefield and Breakthrough.

OVERVIEW

“A Journey of a thousand miles begins with a single step”…. Tao Te Ching

Strategy is about excitement, about intense planning and about learning from mistakes. Strategy is not only a dream and a vision; it is also the skeleton of the architecture for progress. It lays the foundations for the future of change, a bridge from the current to what has never been before. It is a long-term plan to reach the desired, future envisioned state and includes the company’s goals and objectives, the type of products/services that are planned to be built, the customers who you want to sell to and the markets that you serve to make profits.

The strategist must learn to anticipate the unexpected, and be able to avoid being surprised. A strategist operates in an environment of challenges and stress, requiring intuitive awareness, anticipation of an opponent’s path of action, and instantaneous and even anticipatory perception, decision and action. The challenge is that many people are able to function well in intense situations as long as the rhythms and conditions are predictable and obvious. Much of strategy involves reacting to surprise. This requires neutralizing or reversing the effects of altered conditions by which the opponent seeks to throw you off balance and gain an advantage when you are startled and hesitant.

The ability to anticipate, perceive and act under stress is central to strategy in action. It is not only defensive in nature, the strategist also needs to be able to impose stresses on the adversary and to seize advantage when openings are created. Conversely, the successful strategist must be prepared for surprises and be adaptable in the midst of stress. All strategists develop the ability to perceive the future as part of the present. Understanding people, both as individuals and as members of groups, is one of the most critical elements of strategy. When you know humans, what they value, how they act and why, and are able to function intuitively then you can see past other’s masks and illusions and perceive true intent. When you have studied in the way required of the strategist you can perceive the structure, rhythm and timing of the strategic context. Things that confuse others will be clear to you.

Knowing the competitors thoroughly is the first step towards success. Believing that one’s business model is absolutely unique and thinking one is impervious to competition can prove to be a grave mistake for any entrepreneur and eventually become their undoing. Competition in business is certain, and therefore, a thorough knowledge of competitors, their strategy, and successful moves is a must for entrepreneurial success.

If one were to consider the classic writings of war, one would probably include Sun Tzu’s “The Art of War,” considered by some to be the oldest military treatise on warfare, and Miyamoto Musashi’s “A Book of Five Rings,” espousing the doctrine of the samurai through kendo and Zen (The Way of the Sword). These books have gained popularity as having application to the business world.

In “The Book of Five Rings,” Musashi speaks of strategy and training through the use of the sword.  Kendo, the Way of the sword, had always been synonymous with nobility in Japan. Since the founding of the samurai class in the eighth century, the military arts have became the highest form of study, inspired by the teachings of Zen and the feeling of Shinto.  Musashi explains how to train with the sword, enter the fight, and discover the Way of strategy.

“The Art of War” contains nine chapters dealing with laying plans, waging war, attack by stratagem, tactical dispositions, energy, weak points and strong, maneuvering, variation in tactics,  the army on the march, terrain, the nine situations, the attack by fire, and the use of spies utilizing five constant factors that respond to the elements of circumstance – Why, Who, What, How and Where & When.  The gist of Sun Tzu’s thinking is planning and preparation with the goal of defeating an enemy.

As Confucianists tried to make the universe comprehensible by adopting ideas from a centuries-old work called the Book of Changes, or I-Ching, which saw the universe affected by the arrangement of numbers, seeing numbers not as mere human inventions for measurement but as having a power of their own. They believed that by studying combinations from eight trigrams and sixty-four hexagrams one could uncover any possible activity in nature. To round out their view of the universe, Confucianists adopted an explanation of the origins of the universe. It was more imagination. They believed that in the beginning all was vague and amorphous, that this was followed by emptiness and that emptiness had produced the universe. They believed that what was clear and light in weight had drifted upward to become heaven, and that what had been turbid and heavy had solidified and become earth. The combined essences of heaven and earth, they believed, became Yin and Yang and a great oneness. Together with Yin-Yang, the 5 element theory (Wu Xing) is of fundamental importance in Chinese philosophy. The 5 elements are : Water, Fire, Wood, Metal and Earth.

The subsequent sections will delve into both of these and the Phoenix Encounter Method to start detailing a comprehensive approach to business strategy.

THE FIVE RINGS (五輪書) CONSTITUTION

“One-thousand days of training to forge,
ten-thousand days of training to refine.
But a [Kendo] bout is decided in a split second.”

Used for centuries by Japanese businessmen and studied by many of Silicon Valley’s warriors of today’s wired world, The Book of Five Rings or Stories (no-Maki) by samurai swordsman Miyamoto Musashi has provided a powerful, practical approach to achieving competitive dominance.

After a long and illustrious career as a swordsman, establishing and refining his martial skills, followed by years of scholarly study, Musashi retired to the Reigandō Cave in 1643 to meditate and record his thoughts on the Martial Way in Gorin-no-sho. Musashi’s book is arguably one of the most influential and widely read martial art treatises. It is studied not only by martial artists for whom the manuscripts were originally intended, but by general readers in Japan and around the world who seek glimpses of the unforgiving world of samurai warriors. His discourse on strategy has become a guide for modern military leaders as well as corporate warriors attempting to make a killing in the stock market or find success in the competitive world of business. According to Mushashi, going deeply into the Way of Strategy produces a revelation of insight into all things, and a freedom in action unlike anything else. His teachings have even been adopted by experts in the field of sports psychology as a recipe for success in the modern sporting arena.

There are many myths about Musashi’s life. This one  of Musashi’s alleged aversion to bathing and how he went his entire life without soaking himself even after a hard day fighting. Apparently, Musashi claimed that one pail of hot water was enough to cleanse himself. Another explanation is that Musashi felt that being naked in the bath made him vulnerable to attack. Above all, Musashi’s duels are described with unbridled fancifulness. To call somebody a “samurai” in Japan today is to bestow the highest praise. The word epitomizes strength, selflessness, bravery,loyalty and honor. Musashi’s reputation as a peerless samurai champion is revered by the majority of Japanese. But, he is also reviled by some as representing the antithesis of the Way of the samurai. A common criticism is his alleged use of cowardly delaying tactics to irritate his opponents and to win by any means possible, however dishonorable.

Gorin-no-sho, literally The Five Rings refer to the idea that there are 5 universal elements, just as there are different physical elements in life, as described by the Greeks, Egyptians, Hinduism, Buddhism, Shinto, and other Eastern religions.

1. Earth – Chi (The Foundation) serves as an introduction, and metaphorically discusses the essential foundations needed. Here, Musashi documents the first half of his life. He also introduces military tactics and the metaphysics behind his school. He asserts that combat strategy is applicable to both generals and rank-and-file soldiers. He also includes a set of rules the warrior should follow if he is serious about mastering the Way.
2. Water – Sui (The Techniques) describes basic techniques and fundamental principles and flexibility to change. Here,  Musashi explains various aspects of individual combat, such as mental and physical posture, gaze, how to manipulate the sword, footwork and fighting stances. The content is pragmatic and provides aspects of sword work in detail.
3. Fire – Ka (The Competition) concerns with competition and different types of timing. Here, he expounds on such matters as how to choose the best site for dueling, how to control the enemy by taking the initiative and implementing stratagems not only applicable to one-on-one duels but also to large-scale battles involving thousands of men.
4. Wind – Fu (The Tools) describes alternative approaches. Here, he critiques other schools of swordsmanship and summarizes their weaknesses.
5. Void or Emptiness – Ku (The Review) is a short epilogue, describing, in more esoteric terms, Musashi’s Zen-influenced thoughts on consciousness and the correct mindset. “By knowing things that exist, you can know that which does not exist.” Here, he discloses the supreme level of all arts by referring to the allegorical void, emptiness or nothingness that the warrior must achieve in his own mind in order to find “liberation.”

Strategy is goal-driven. The ultimate test of the ability of a strategist is in the quality of the outcomes achieved. Musashi tells us that winning is the ultimate purpose of strategy.  The primary object is winning, defined as the best and most pragmatic outcome that can be achieved, including in some instances avoiding losing or at least being able to mitigate negative consequences. Being goal-driven seems simple but it is amazing how many people never focus clearly on realistic goals aimed at achieving what is referred to as pragmatic definitions of victory.

THE ART OF WAR (孙子兵法) MANIFESTO

“In the midst of chaos, there is also opportunity”

The Art of War remains the most influential strategy text in East Asian warfare and has influenced both Eastern and Western military thinking, business tactics, legal strategy, lifestyles and beyond. The book contains a detailed explanation and analysis of the Chinese military, from weapons and strategy to rank and discipline. Sun also stressed the importance of intelligence operatives and espionage to the war effort. Because Sun has long been considered to be one of history’s finest military tacticians and analysts, his teachings and strategies formed the basis of advanced military training for millennia to come.

The most important point of The Art of War makes is that information does matter, and an educated guess is better than a gut decision. Sun Tzu thought that generals should be adept at the “military calculus” of taking into account anything and everything that could affect the outcome of a battle.

The art of war is governed by five constant factors, to be taken into account in one’s deliberations, when seeking to determine the conditions obtaining in the field.

A. The Reason (Why?) The intent needs to be clearly articulated.

B. The Leadership (Who?) stands for the virtues of wisdom, sincerely, benevolence, courage and strictness. These are to be understood for marshaling of the its proper subdivisions, the graduations of rank among the officers, the maintenance of the infrastructure by which progress can be made, and the control of expenditure.

C. The Conduct (How?) causes the workforce to be in complete accord with the leadership.

D. The Environment (What?) signifies the infrastructure and the provisionings needed.

E. The Terrain (When & Where?) comprises distances, great and small; danger and security; open ground and narrow passes; the chances of life and death

By thinking, assessing and comparing these points, the correct strategy can be ascertained for a business. Habitual deviation from these calculations will ensure failure via improper action. Running a business matter for the state and must not be commenced without due consideration. Why, Who, What, How and When & Where (the Elements of Circumstance) enable the elucidations of questions to probe into the reason, value drivers, variabilities, capability gaps, best-practices, cadence and return-on-investment, and its circularity.

Even though strategy is goal-driven as defined in the section on The Five Rings, the process of setting goals is difficult, opaque, shifting and imperfect. Too often we get caught up in a conflict and forget that it is only a means to an end. Sun Tzu tells us how to recognize and concentrate on our goals. He explains what is involved in defining the terms of victory in the situation with which we are engaged. He also offers insights and approaches that increase the likelihood of our success and reduce the costs of the strategic campaign.

THE RHYTHMS IN STRATEGY

“Kill or be killed. You cannot be a samurai and think of saving the world.” – One of my own sayings

Both the Five Rings and the Art of War emphasize on a staged way for strategy – a certain set of rhythms that needs to be accomplished through diligence and practice. In the diagram below I have merged the two philosophies into a tapestry that looks at each of the 5 aspects of the ascensions along the horizontal (Art of War) and the vertical (5 Rings) dimensions so that the intersect form the rhythms of strategy. Each rhythm will consist of a facet indicated by A1-E5.

Included within each facet are define and design elements that are needed to be worked on for the proper functioning of the business. Each rhythm will also have interactions with adjacent rhythms – horizontal or vertical – these will correspond to the processes that need to be developed to transact between the facets for progressed evolution of the strategy. While facets will be ratified using principles of Design Thinking, Systems Engineering will be used to rationalize the interactions thus providing a holistic view for every aspect of the business.

In philosophy, there is the concept of Gestalt: that the whole is different/greater than the sum of its parts. The intent of the above tapestry is just that and to provide a holonomic view for the functioning of the organization and make it resilient to internal change and external forces that constantly try to disrupt the frictionless functioning of the mechanisms of the processes.

THE PHOENIX ENCOUNTER METHOD

Disruption is not new. Historically, larger armies have disrupted kingdoms, agricultural prowess has lead to new business opportunities and the industrial revolution has created a new wave of businesses and even mechanized war. The Industrial Revolution powered the economy for three hundred years, so it’s no surprise that the management approaches from that era have come to dominate the world of leadership – progressing the evolution from Industry 1.0 to today’s Industry 4.0 wherein robotic processes, smart devices, digital thread and digital twins, Augmented and Virtual Reality (AR/VR/XR) and the internet of things (IoT) is becoming the norm in all aspects of the business

But as the information age compresses time frames and unforeseen crises such as Covid-19 (that caught most businesses sleeping at the wheel) destroy existing organizational structures, the most critical leadership question is no longer how do we minimize error and maximize efficiency – but how do we reinvent the future when everything is constantly changing. How do we survive the present? Can we repair a car when it is driving? Can we adapt to an unknown future?

What is different with digitization is its pervasive nature – it has unlocked the flow of information and invaded every facet of our beings. Today, as the information age compresses time frames and unforeseen crises such as Covid-19 destroy existing organizational structures, the most critical leadership question is no longer how do we minimize error and maximize efficiency – but how do we reinvent the future when everything is constantly changing. There is even more need to rethink about strategies to include elements that we would have never considered before – and most times it means totally straying away from what we considered as norm.

Leaders are not born, but made. New methods of organizational leadership are needed. Complacency, arrogance, cautious and overwhelmed – the current modals for leadership will simply not cut it. To helps to develop cross altitude thinking and build awareness, The Phoenix Method suggests a mental agility to operate in three altitudes simultaneously:

1. 50,000 ft strategic,
2. 50 ft tactical,
3. 5 ft personal

The best leader flies across all these altitudes to scan for inefficiencies, challenges and constraints, ripping apart processes that are stagnant and do not have any perceived value. Dreamers hate doers and vice versa. An effective leader should manage the coexistence between imagineering and engineering, two essential facets that two sides of the same coin of business.

A JOURNEY IN 3 STAGES OF MATURITY

Run, run, run, run, run, run, run, run
Run, run, run, run, run, run, run, run
You better make your face up in
Your favorite disguise
With your button down lips and your
Roller blind eyes
With your empty smile
And your hungry heart
Feel the bile rising from your guilty past
With your nerves in tatters
When the conch shell shatters
And the hammers batter
Down your door
You’d better run
                                           – Run Like Hell, Pink Floyd

Crawl -> Walk -> Run are typically the three steps of maturity that any transformation entails. Strategy, the precursor to transformation can be envisaged to progress in three stages:

1. Groundwork – deep reflection and preparation
2. Battlefield – Methods and tools for expansive and integrative thinking to consider diverse possible scenarios and to generate wider set of options to respond. It is a combination of conventional and contemporary actions, both to protect the core and to transform
3. Breakthrough – A future proofing blueprint, embedding change and making it a repeatable process

In keeping with the theme of this paper, the following is the composition of the different rhythms that are needed to accomplish this

MODUS OPERANDI

It ain’t me, it ain’t me
I ain’t no millionaire’s son, no, no
It ain’t me, it ain’t me
I ain’t no fortunate one
                                             – Fortunate Son, Credence Clearwater Revival

In business unlike life, there are no accidents. This section will be the basis as I chart out my new venture from first principles, the master plan, the charter and the manifesto, the rudiments of the blueprint of form following function, and all the strategies entailed.

In business, modus operandi is used to describe a firm’s preferred means of executing business and interacting. This would mean implementing the Quintets: the 5 functional Ps (Plan, Pattern, Position, Perspective and Ploy) in the 5 facets of the business (Corporate, Business, Functional, Operational and Interactional/Experiential) utilizing the Rhythms to accomplish the results – of being, of interacting and of achieving purposeful goals in the progression of enterprise’s future.

SUMMARY

“Optimism, pessimism. F***k that, we’re going to make it happen.” – Elon Musk

My sanitized version: Doesn’t matter if the glass is half full or half empty, its time for a drink!

Business is an on-going cycle of art and science. Analyzing data that influences the imagination to create something new and then experimenting with the idea to see how and if it works in the market. It goes on with gathering information, creating from it and experimenting with it, a never-ending balance of art and science.

• Corporate Image is the vehicle for the Business to present itself to its stakeholders, how it perceives itself and how it communicates its values and personality in a visual sense. it is important for businesses to have a clearly defined and well expressed corporate image. The visual identity of the business impacts on marketing, PR, client relationships, stakeholders and investors.
• A Contemporary Workplace can enhance a corporate identity and a business can embed its identity into its workplace design. Art is a way of displaying company culture.

The combination of the Art of War and the Five Rings with the Phoenix Encounter Method gives a structured approach and actionable set of tools and processes to develop, enhance, practice and use strategic thinking skills. It helps to think in terms of possible diverse scenarios and options to respond or to innovate when there is uncertainty and lack of clarity.

It is also important to account for diversity. Globalization has made the world a smaller working place and nuances related to culture, the way of doing things and the approach will play a major role in enabling coordination, collaboration and cooperation between teams – (the combination of the three Cs that is now termed as coopetition to also include competitive forces). Companies like Tesla and Space X also use two or more separate teams to do the same task to foster healthy competition and prevent lethargy.

For far too long, strategy has been stuck in a static world. The Phoenix Encounter Method advances a methodology that recognizes that sustainable competitive advantage is a myth and offers an approach to rethinking strategy when advantages are transient, and competitors can come from anywhere. The method introduces not only dynamism, but emotion, mindset, and leadership into the creation of the next strategy. It’s a powerful combination to reshape your tomorrow using firestorm disruption, radical ideation, risk aversion and radical thinking.

As we move into Industry and Services 5.0 which also accounts for a human-centric approach to customer enablement, disruption of current mass manufacturing tenets will be prominent in creating customized and personalized products that are mindful of privacy, security, and ubiquitous access.

We are not interested in the status quo. In business unlike life there are no accidents. As we chart our venture from first principles, the master plan, the charter and manifesto, the essentials of the blueprint of form following function and all the strategies entailed, we will question the norm, do the different and constantly innovate. We are not afraid to fail as we believe that it will make us stronger.

The ideas are already flowing. Our world and this universe is our oyster and we are looking for a few good humans and even AI bots. We are futurists, not anachronistic. We are the dreamers and doers, and you are welcome to join us.

NITIN UCHIL Founder, CEO & Technical Evangelist

nitin.uchil@numorpho.com