offerbook 3

The Big Idea

This book lays down 14 strategies for competitive advantage - 6 attacks and 8 defenses, the success of which depends on
mastering the rules of timing (when to perform each type of strategy); method (how to implement it); and alliances (whether to do it alone or in alliance).

Chapter 1 - You can win with ten or lose with a hundred: two examples from the field of war

On January 22, 1879, 5,000 British forces stationed at Isandlwana were massacred by 24,000 Zulu army warriors. In the afternoon of the same day in Rorke's drift, 100 British army men had defeated 4,000 Zulu warriors. The British forces were established at a camp at Natal, and an officer, Major Dartwell, left the camp and hunted Zulus. Along the way he encountered a Zulu army of 1,000. The British army sent the company of Chelmsford to help the forces engaged in the
on-going battle, but little did they know that the 1,000-man Zulu army was just a pawn of the Zulu to divert their attention away from their real target, Isandlwana. While the concentration of the British was the on-going battle, The Zulu attacked the
British camp and massacred everything in it.

Chapter 2 - The reason for victory and defeat - and the lessons for business

The factors that led to the triumph of the Zulus over the British can be summarized in four variables:

Knowledge of the enemy
Focus
Choice of terrain
Surprise

The same principle can be applied in business.

Fight where it suits you. Choose the terms of engagement. Be the company in control and not being controlled. Choose the nature of the battleground and the kind of terrain in which to hold a fight.

Surprise
In battle, the enemy must not have information about one's plan of action. The key in winning battle is to catch the enemy in the open and unaware. In business, if a company is caught unawares by a new and timely strategy implemented by its rival, it will take time for them to react and recover, and it demoralizes competition.

Chapter 3 - Attack: the six strategic movements

Attack vs. defense
A move can be called an attack if someone enters a new geographical area, a new industry, and/or new segment within the same industry and geographical area (Entry), and this movement occurs with an initiative to gain profits or synergy (Unprovoked).
ATTACK = (1) Entry + (2) Unprovoked
There are six possible ways to attack an opponent:

1. Guerilla
2. Bypass
3. Flanking
4. Frontal attack
5. Undifferentiated circle
6. Differentiated circle

The first four types are concerned with entry into a single segment, while the remaining two refer to entry into two or more segments.

Chapter 4 - Defense: the eight strategic movements

The difference of defense from attack using the formula stated above (attack= entry + unprovoked) is when one of these two elements is absent.
Essentially, there are eight (8) defensive strategies:

1. Signaling
2. Creating entry barriers (fixed and mobile)
3. Global service
4. Pre-emptive strike
5. Blocking
6. Counter-attack
7. Holding the ground
8.Withdrawal

Chapter 6 - Organizational alliances

The term “organizational alliances” is a broad one that encompasses various types of association.
To keep the cost of an alliance in control, there must be a detailed plan of objectives and strong management.
There are thirteen types of alliances:

Protocols (agreement on the standard characteristics of the products)
Exchange of members of the board of directors
Consortiums
Private and brand agreement
Dual marketing
Vendor/buyer agreement
Commercial agreement
Franchise
Licensing
Joint venture
Exchange of minority holdings
Acquisition
Merger

Chapter 8 - Conclusion: the eight rules to follow to deserve success

1. Defense is stronger than attack

2. There are four (4) criteria that must be satisfied before attacking

3. There is a natural sequence in choosing a defense

4. There is a natural sequence for choosing an attack