Posts Tagged ‘relevance of military strategy to business’

By Richard Martin

We need to talk about the economic impacts of the Ukrainian invasion on Russia and, by extension, China. Key strategic takeaways:

1) Russia is heading toward an autarkic situation, with trade limited to China and other countries in the Axis of Lies. In essence, it is in the process of becoming a huge North Korea.

2) Russia needs Ukraine for its resources and productive capacity (Lebensraum).

3) China is crucial to Russia to provide markets, access to capital, and a conduit for advanced technology and outside innovation.

4) The United States must lead the West in cleaving China and Russia apart and play them off against each other, as was achieved with the Opening to China strategy of the 1970s.

5) The United States and Canada should stop tilting at windmills – literally and figuratively – and ramp up production and export of hydrocarbons, especially gas, to supply Europe, Japan, and other friendly and like-minded nations.

Most Western countries have imposed a raft of economic and financial sanctions on Russia since the invasion began on 24 February 2022. These are in addition to the sanctions that had been imposed since the annexation of Crimea in 2014.

Depending on the country, measures run the gamut from cutting Russia off from the Swift payment network, seizures of financial and real assets of regime members and oligarchs, embargoes on oil, gas, and petroleum products, trade interdicts, massive tariff increases, banning of Russian civil aviation, and other less prominent sanctions too numerous to mention.

So much for state-level sanctions. Transnational companies have also announced they are pulling out of Russia or will do so imminently. Many of these have decided to liquidate their investments in Russia, or simply abandon them and take massive write-downs on their assets. The most prominent of the latter are some of the biggest oil and gas companies in the world, such as Shell, BP, and Exxon.

On the other side of the equation, the Russian government has been banning foreign media outlets while threatening draconian prison sentences on anyone contesting the official Kremlin line on the invasion. This includes foreigners, and some of the most credible and courageous news organizations are being forced out or cowed into more insipid coverage.

To add to the informational chaos, Netflix, Facebook, TikTok, and other social media platforms have either ceased operating in Russia or have been banned. Putin and the Kremlin has threatened to completely cut off the country from the Internet. This will give the Kremlin full rein to poison the minds of Russians and indoctrinate younger generations even more than is already the case. Russia has adopted a strategy of information chaos with the goal of generating cynicism and nihilism internationally and complete obedience internally. When combined with autarky and complete top-down control of the economy and country, Russia is well on its way to realizing its brand of fascist nightmare.

While all this is happening, China, Russia’s non ally “strategic partner,” has continued to supply resources and maintained trade with Russia. In my estimation, this relationship will only get closer. I assess that Russia is headed for autarky, with China constituting Russia’s principal market for raw materials while providing access to technology, high tech manufacturing, and investment capital. Chinese companies have already started circling abandoned or divested Western enterprises like vultures. The pickings should be reasonably good for China.

This puts the invasion of Ukraine in a different light. In effect, Russia needs Ukraine as Lebensraum (living space). Yes, I use that term in the very specific sense of Nazi Germany. As many commentators have pointed out, Ukraine has tremendous resources, including agricultural, industrial, and other economic capacity, actual and potential. Whether Russia can fully exploit that potential will depend on the technical, financial, and industrial support the country receives from China in addition to what it can muster internally.

This assessment suggests a few inferences. First, to be successful, Russia’s invasion of Ukraine must end in its conquest and incorporation into the Russian economy and sphere of influence. I believe that is the ultimate war aim of Putin and the Kremlin and will lead to the near complete reconstitution of the Russian/Soviet Empire. This would explain Putin’s willingness to sacrifice so much military combat power and his readiness to destroy civil infrastructure and housing. We should be on the lookout for deliberate preservation of industrial and other productive assets by Russian forces with a view to restarting production as quickly as possible post-occupation or conquest.

Second, China has a crucial role to play in assisting Russia in its ultimate intent of reconstituting its territorial empire and in sustaining Russian autarky. China can give Russia access to markets and innovation. There is also considerable opportunity for China to act as an indirect channel for technology and sales of commodities and raw resources. Western powers, starting with the United States, should find a way to cultivate improved relations with China, like what was achieved in the 1970s with Nixon-Kissinger opening to China. As unpleasant as that may seem, the West has no choice but to cleave China from Russia to relieve the pressure on Eastern Europe and give some chance of success to Ukraine’s resistance.

Third, Western nations with significant hydrocarbon resources (i.e., oil and gas), must replace Russian supplies as quickly as possible. There are two aspects to this approach: A) The need to ramp up production in the US and Canada, especially of gas, and develop the supply chain to get the gas from the ground to LNG terminals quickly and effectively; and B) The imperative to develop alternate sources of oil and gas for the free world, such as the Iran, Venezuela, and other locations, as repugnant as that may be. During the Cold War, Persian Gulf oil was essential for the prosperity and security of Europe and the Far East. Now is no different.

© Richard Martin

Richard Martin was an infantry officer for over 20 years in the Canadian Army. He is currently an entrepreneur, strategic advisor, and information warrior focusing on extracting valuable information and signals from chaos and noise.

By Richard Martin

© Rotislav Sedlacek | 123 Stock Photo

My study of military history has taught me that most soldiers and warriors throughout history have gone willingly, if not enthusiastically, into battle. They followed their comrades in arms, and they followed their leaders. They participated in behaviour that was downright counter to their survival and the wish to live a long and prosperous life. In many cases, they fought to defend themselves, their families, and their lands against hostile depredations. But in many other cases, perhaps most, soldiers and warriors have fought for conquest, glory, pride, courage, status, recognition, and booty.

 

On the other hand, the Canadians who have served and sacrificed for peace and security around the world present something of an outlier in this respect. Since the Boer War at the turn of the 20th century, Canadians have largely fought or operated oversees, taking on the forces of countries that have threatened Canada and its allies directly and indirectly, or endangered world peace and security. Over 116,000 have given their lives in these missions, and countless more have sustained debilitating mental and physical wounds. Of these, 158 Canadian soldiers died in Afghanistan between 2002 and 2011. Often forgotten is that approximately 130 Canadian soldiers have died in peacekeeping missions.

It’s only by talking to combat veterans that we can gain a true appreciation for the sheer difficulty of combat and what is involved in military leadership. I was on a battlefield tour when serving in Germany. A Canadian veteran of the D-Day campaign had been a platoon commander during an operation to capture and secure Carpiquet Airfield, near Caen, Normandy. His recall of the engagement was of crawling uphill under the enemy’s grazing fire. Rationally, he knew full well that he had fought on an airfield, and that his memories of crawling uphill must be mistaken. On the other hand, he couldn’t shake the persistent impression of having to struggle against gravity. When he eventually visited the battlefield after the war, he could see that the ground was basically flat and even. It was an airfield after all. But still, the memory stuck with him, and it was only decades later that he could picture the fight in a more objective manner.

The leadership challenge in combat is singular. That soldiers under your command will follow you is not necessarily given, despite the weight of military discipline. Charly Forbes, a veteran infantry officer with the Régiment de Maisonneuve during the Second World War and the Vandoos in Korea recounted his baptism of fire. He had just taken command of a depleted platoon in a company that had been decimated only days before by friendly fire from Allied bombers. He had to lead his platoon to take out a German machine gun that was holding up the battalion’s advance. He did his combat estimate and came up with a simple plan and briefed his men. On his signal, they would run on the flank to assault the machine gun nest while his own machine gunners would lay down covering fire. As he gave the signal, he leapt up and rushed toward the German MG. After a few yards, there was so much withering fire that he had to take refuge in a shell hole. That’s when he realized that there was only one of his soldiers with him. Unflustered, the private said, “It’s okay sir; we’ll take ‘em out,” and the two of them completed the mission.

What does it take to lead soldiers and partake in combat? What makes your troops want to follow you? What makes you want to lead them in this dangerous and, frankly, irrational behaviour? It seems daunting, but it has been done since time immemorial. Coercion and punishment are always possible, but they only work to a certain point. In the final analysis, the best troops are the ones that want to fight, that have morale and cohesion, and who are willing to follow their officers and NCOs until the mission is done. This is what most sets apart the Canadian soldier, sailor, or airman.

© 2017 Alcera Consulting Inc. This article may be used for non-commercial use with proper attribution.

By Richard Martin

Source: Canadian Armed Forces

Leadership is the art of influencing others to get things done in the manner and to ends desired by the leader. The biggest challenge comes not in figuring out what to do, or even in how to do it, but rather in communicating your intent and actually getting people to implement it and achieve desired results.

Companies–small, medium, and large–can have this problem, even those with sophisticated, complex operations and processes. I call this the “disconnect problem”: There is a break between what goes on in a leader’s brain and what happens on the ground to achieve the mission and vision. The resulting gap leaves the organization open to distorted information transfer, mutual incomprehension, corrosive conflict, and other forms of friction.

How can a leader overcome this disconnect problem, and get from her intent to her desired outcomes? There are a few basics that have to be respected. First, there must be a clearly articulated mission with a concrete vision of the end state or desired outcome. This aim must be articulated into supporting objectives which are in turn broken into specific functions and tasks.

The resulting work hierarchy then becomes the framework for assigning responsibilities, authority and accountability, along with the resources and supporting structures and systems to get the job done. It isn’t enough to browbeat people or simply set goals and make compensation depend on their satisfactory achievement. This is a necessary but non-sufficient condition for attaining the aim.

When I went through leadership and command and staff training the army, we had to learn how to “assign troops to tasks.” We were taught–and realized through experience–that things only get done when you have a reasonably good understanding of the mission and effort involved, but also when the work is actually assigned to real people, along with the weapons, vehicles, equipment, ammunition and combat stores to achieve assigned tasks. Otherwise, it’s all just wishful thinking.

Are you just browbeating people into implementing your intent, or do you have a clearly articulated plan, with specific assignment of responsibilities and enablers? If the former, then start now to be more specific in transforming your intentions into actionable direction on the ground. If the latter, then refine your approach and ensure that all levels in your team are doing the same. Also, seek to apply “troops to tasks” to all areas of endeavour within your organization.

© 2017 Alcera Consulting Inc. This article may be used for non-commercial use with proper attribution.

By Richard Martin

There has been a lot of chest thumping and ink spilled in recent days about the announcement that Airbus and Bombardier Aerospace have agreed to transfer control of the new C Series airliner business from the latter to the former.

There are important implications from this transaction in terms of politics and economic policy. My goal here, however, is to focus on the readiness and strategic implications for the two companies involved. In a nutshell, both Bombardier and Airbus saw a window of opportunity open and jumped through it at the right time.

© Sergey Ilin|123RF Stock Photo

For Bombardier, Airbus brings financial, commercial, and industrial know how and credibility. If you want to be a global player in the market for commercial airliners, then you have to have a global network with a strong backbone, including the robustness and resilience to batten down the hatches during storms, absorb shocks, and bounce back when the weather turns. Bombardier, while technically able in terms of innovation and development, didn’t have the wherewithal to compete against the big boys: Airbus and Boeing. As a business decision, this opportunity makes eminent sense and I’m sure will be a long-term success.

For Airbus, the opportunity was just too good to pass up. Airbus acquires a brand-new design with huge commercial potential, especially in Asia and the Far East. Talks between Airbus and Bombardier had apparently been ongoing for two years or so, but had broken down more than once for undisclosed reasons. The biggest advantage for Airbus, though, is that the tie-up with Bombardier’s C-Series deals a blow to Boeing. Airbus no longer has to continue developing an aircraft in the same size-class as the C-Series, while acquiring new capabilities and geographical reach.

The big loser in this manoeuvre is, however, Boeing. The latter was evidently trying to destroy the C-Series by lobbying for punitive tariffs on the planes if sold in the US. However, Airbus already has facilities in the US to assemble the aircraft. Delta Airlines, Bombardier’s lead customer for the C-Series in the US, has already declared that they will wait for the planes that are assembled in Airbus’s Alabama factory.

The biggest difference between Boeing and Airbus when faced with Bombardier’s competition is the fact that Boeing chose to view the C-Series antagonistically, as a threat, whereas Airbus viewed it positively, as an opportunity. The same goes for Bombardier. Claims and counter-claims of “illegal” government support are overblown. No one is blameless in that regard, and Boeing is probably the most hypocritical of all.

Regardless, from the standpoint of business strategy and business readiness, Airbus and Bombardier have shown that exploiting opportunities are just as important, if not more so, than trying to prevent or mitigate threats, as important as these may be.

© 2017 Alcera Consulting Inc. This article may be used for non-commercial use with proper attribution.

Here’s the link to my April 2017 column on Defence Leadership or download as PDF.

Here’s the link to my June 2017 column on Defence Leadership or download as PDF.

 

 

By Richard Martin

© Alexskopje | 123RF Stock Photo

The recent spate of natural disasters (hurricanes, earthquakes) have shown once again the need for readiness and resiliency for operational and business continuity. I’ve also been working with a client organization to review and upgrade its continuity programme. Here are some basic principles to keep in mind.

  • Readiness for business continuity is a leadership responsibility. It is a strategic concern and must be led by senior leadership and executed by the entire organization and its “chain of command.”
  • Business continuity is part of contingency planning and preparedness to respond and recover after prevention has failed. In other words, it’s part of your risk/threat mitigation strategy.
  • Insurance is needed to help recover and rebuild after a disaster or a crisis, but it can neither prevent nor mitigate the impacts as they unfold. That is where the entire preparedness and readiness programme come into play.
  • There are three phases to business continuity planning and management: preparation, response, and recovery. The preparation phase should always be in effect, and not just an afterthought.
  • Business continuity planning (BCP) must be conducted on a cyclical basis, for instance every year. It must be aligned with other normal management processes such as annual budgeting and capital planning so any required investments can be identified and adequately resourced.

© 2017 Alcera Consulting Inc. This article may be used for non-commercial use with proper attribution.

by Richard Martin

© Kheng Guan Toh

I’ve been answering questions lately (from my daughters, among others) about the threat of war, specifically nuclear war. This obviously comes from the worries about North Korea’s nuclear capabilities and intentions, as well as American ones.

Although this concerns military strategy and geopolitics, the underlying analytical approach can be applied to any consideration of threats, whether a generic SWOT analysis, or the evaluation of a specific security or competitive menace.

Threat analysis goes beyond risk analysis. Risk is the product of the probability and impact of a negative event or cause. Risks are usually categorized under three headings: natural, technological, and human. Focusing on the last, there are criminality, security, labour conflict and many other sub-categories of human originated risks. The problem, however, comes in evaluating the likelihood of a human risk. If we are considering only generic risks, we can talk about probability and impact in abstract terms. For instance, what is the probability of a criminal act? We can use statistics about, say, white collar crime in corporate settings as a starting point for assessing the risk. There are statistics describing the probability of certain acts in certain situations along with average impacts (including their statistical distribution).

But how can we assess a specific threat where there is no historical or statistical data to illuminate the analysis? That’s where military-style threat analysis can be very useful. Military threats are broken into two parts: capability and intent. Capability is self-explanatory: What can the potential or actual enemy do? What are the quantitative and qualitative characteristics of his forces? How many tanks can he deploy? How many aircraft? In the case of North Korea, how many nuclear bombs, of what type, and through what means can they be delivered? I discussed this at length in early September with Dr. Sean Maloney of RMC, an expert on nuclear history and strategy.

While there is uncertainty in capability assessment, at least we’re dealing with tangible realities. Intent is a completely different ballgame. How do we know what the enemy will do? How will he react to our own threats or efforts at conflict resolution? These are imponderables and we must consider a range of scenarios to determine the inevitable commonalities that arise in each, so we can prepare for them. We must also examine the action-reaction cycles that occur because of the moves and countermoves by both sides.

An analogous approach can be used in analyzing and assessing business threats, even though the stakes are obviously of a completely different order and importance. Whether you’re trying to assess your competitors’ next moves, or your market’s reception of your new product, you can learn a lot by considering the threat as both capability and intent. This allows you to disentangle what is possible (given assessed capabilities) from what is probable (given assessed intentions) over a range of scenarios. The insight gained can then be incorporated into your own strategy and contingency planning.

© 2017 Alcera Consulting Inc. This article may be used for non-commercial use with proper attribution.

by Richard Martin

Copyright: Tomas Griger

After the magnitude 8.3 earthquake in Mexico last week, an acquaintance of mine was fretting about how these natural disasters couldn’t be a simple coincidence.

Of course, that acquaintance was referring to the apparently large number of violent systems in the South Atlantic this hurricane season in combination with an earthquake. I’m not sure what these phenomena have to do with each other. How are weather and geology supposed to be connected? Perhaps in the very long term, on the scale of eons. But over days or hours? Not likely.

Humans have a propensity to see causality and correlations where there is just coincidence. Most things happen for no reason at all. It’s easy to see patterns where there are none, especially in nature. If you see linkages where there are none, you can drive yourself crazy with anxiety and paranoia. Things happen. Sometimes they bunch up in time and place. Other times they are more or less spread out.

The trick to being prepared isn’t so much to predict specific causes or events, it’s to prepare for generic outcomes and effects. If you’re in a hurricane or seismic zone, you can’t predict when or where events will occur, but you know that they will occur with a certain frequency and power. For instance, every decade or two, there is a major hurricane in your zone. Every year there is at least a major tropical storm. Geological risks are much harder to characterize, but if you are in high-risk seismic region, then you have to prepare for the worst case.

Of course, preparedness and resiliency are largely a function of wealth. Storms, earthquakes and other natural events are a lot costlier in wealthy regions, but relatively less destructive of life and limb. In poor regions, the relationship is inverted; there are many more deaths and the destruction, although extensive, costs much less. However, the time to rebuild and recover are a direct function of wealth. The greater the capital resources, the faster and easier it is to absorb the costs of reconstruction and resiliency.

These factors also play into the perceptions of coincidence, causality and correlation. We must keep things in perspective when assessing probabilities and impacts. Human destruction is greater in poor countries and increases toward the past. Material destruction was less in the past and is continually increasing. This isn’t because of some connection between events. Rather, it comes from the increased investments in infrastructure, housing, and transportation networks. What was the damage along the Gulf Coast or in Florida prior to people building houses right on the water?

My name is Richard Martin and I’m an expert on applying readiness principles to position companies and leaders to grow and thrive by shaping and exploiting change and opportunity, instead of just passively succumbing to uncertainty and risk.

© 2017 Alcera Consulting Inc. This article may be used for non-commercial use with proper attribution.

by Richard Martin

Here is an easy to use four-step to help in readiness for anything, any time.

Step 1: Mobilize

  • Confirm situation and mission
  • Do time estimate
  • Activate team and support network
  • Prepare equipment, dress, “ammunition”
  • Inform “troops”

Step 2: Reconnaissance

  • Terrain (market)
  • Objective (client, goal)
  • Enemy (competitors)
  • Weather (context, conditions)

Step 3: Plan

  • Aim, factors, options, decision, plan
  • Tactics: frontal, flanking, bypass manoeuvres
  • Exploit/protect centre of gravity
  • Economize and mass for optimal impact
  • Pit strengths against weaknesses, exploit gaps

Step 4: Deploy

  • Brief team, supporters, colleagues
  • Initial and final rehearsals
  • Update plan, develop contingency plans
  • Final preparation – material and psychological
  • Morale – How is your will to win?

© 2017 Alcera Consulting Inc. This article may be used for non-commercial use with proper attribution.