This post is in continuation to the thought processes started by Gautam's post. This is based on my observations of the corporate world, especially some of 'non-numerical' part of it.
Many people (and organizations) tend to look at the corporate world and the markets they operate as a war-zone or a sports arena. Some very interesting parallels make both these fields a seductive analogy. Stiff competition, for one. Strategy (or at least what is assumed to be strategy, in all three fields-business, sports and war) for another. From the brash, 'Art of War' spouting executive, to the Change-is-only-constant-self-proclaimed-guru, other fields are routinely looked upon for inspiration and emulation. As I shall try to show, these analogies are fraught with pitfalls.
1. War:
Peter Drucker observed that when the first joint stock companies were starting up, they did not have too many organizations to look up to. They chose the most inspiring and complex organization of the times, the military. Wartime tools and techniques were found to be very useful for business, right from Linear Programming Techniques, Assessment Center methodologies, to products like microwave ovens. Given this history, it is very easy to get inspired by war and see markets as arenas. However, here are the differences which make the analogy a little shaky:
- War is typically between two major actors. In business, there are multiple (and sometimes unlikely) competitors, multiple 'theatres' of operation, multiple products. So, for example, the insurance industry in India may face direct competition from the BPO industry, as far as talent in the lower levels of management are concerned.
- The aim of war is to vanquish the opponent. Today's businesses are too complex to aim for that. Coke, for example, can't really hope to vanquish Pepsi. Competitors have to collaborate to capture one market and compete on other fronts, something which does not happen too often in wartime scenarios.
- The intent of business and war are inherently different. Businesses focus on growth as measured by profits or other contribution to society. War on the other hand, is focused on territorial expansion or access to resources, which are, quite often, ends in themselves.
2. Sports:
We all like being sports-persons; and what better way to look at what we do everyday than as sports? We seem to do it all: 'training' to succeed, facing competition head-on, both internally and externally, getting 'coached' by seniors for bettering performance, celebrating our successes by doling out trophies…so how is it not sports? Well, here's why:
- The impact of decisions taken in business, especially at middle to senior levels, is seen over a much larger period of time, and managers tend to look at many more factors before taking decisions. Roger Federer, for example, gets immediate feedback about a majority of his decisions, while a branch manager at an insurance company knows the impact of her marketing scheme only at the end of, say, two months. Only at the end of those two months will she know the correctness of her understanding of the market, on which her scheme was based.
- Similar to war above, competition in business is different from that in sports. The German football team need not worry about the Dutch hockey team competing against them, but ITC may have to worry about Khadi Gram Udyog Commission when it comes to procurement. (as an arbit example)
There's another interesting trend nowadays, looking at mythology to derive business truths. Devdutt Pattanaik, who is the 'Chief Belief Officer' at Future Group, exemplifies this trend. I am all for getting inspired by mythology, but again, I fear that people may carry it too far, getting seduced by similarities and failing to appreciate important differences between mythological situations and present-day realities. For example, while Mahabharata (my favourite mythology) had very complex situations, they were set in a time where rights and duties were very clearly, even rigidly defined and tacitly understood by that society. Kshatriya Dharma, for example, had a clear set of norms, which was implicit. Today, using that to define corporate citizenship, for example, may be inappropriate, unless we understand those implicit assumptions well.
