Final Reflections

Perhaps the most appropriate way to go about reflecting on what I’ve learned during the Chindia tour is to go back and examine the questions I had at the beginning of the tour, to compare my trip experience with previous travel opportunities, and to contemplate the questions I was asked at the end of the tour by the students at English Corner.

Before we even got on the first plane to Hong Kong, I had the pleasure of sitting next to a gentleman named Bob who I spoke to at some length about subjects ranging from options trading to engineering to meeting people in faraway places. At that time, I was struck at my inability to decide what “hat” I needed to wear: should I talk to him about the business concepts I’d learned about? Should I explore his history working as an engineer for Chevron? Should I try to explain to him how I defined my life spiritually and how it applied to him? After attending the Chindia tour, I’ve come to think that any one of those options would have been appropriate – it really just depends on what the other person is interested in and what my intended effect on them is. The welcome dinner in China really demonstrated this to me in a very visceral sense: one of the people I sat next to during dinner was interested in the companies we had visited and what we thought of the operating environment, so I put on my MBA hat and told him about how American and Indian business contrasted; after dinner, a native Chinese man asked about my work experience, so I put on my engineering hat and told him the fantastic story of Sea Launch; at the night club afterwards, a German graduate student asked me what I thought of all the people suffering in the world and how my business decisions would react to them, so I told him about my beliefs as a Christian and how they informed my choices and goals in life. My takeaway from these events is an understanding that it can be counterproductive to lock yourself into a concrete behavioral set when you meet someone; people are dynamic, fluid entities, and their perceptions and expectations can rarely be contained by a single paradigm. As a student, I have had the luxury of taking separate business and engineering coursework which rarely overlapped. As a working professional, I am going to be required to wear all of these hats interchangeably (and sometimes simultaneously) in any environment – to think on my feet and make ethical engineering decisions that still make economic sense.

In my high school and college career, I have had the pleasure of touring Europe a number of times with my choir group. Because of these experiences, I thought that I was going to have a pretty similar experience traveling with the business school – nothing could be farther from the truth. Up until this point, my idea of foreign and exotic cultures was places where they don’t play American music in the department stores (note: this is a fast growing trend in the world) – mostly countries like Poland, Hungary, and the Czech Republic. Arriving in India and China threw out any notion of familiarity and threw me into culture shock: immediately, I was presented with completely different character sets, left-handed roads, merchants grabbing at you trying to yank you into their stores, cricket, and construction at an ungodly pace. In my choir tours, our responsibilities basically consisted of learning a repertoire, showing up at the right place wearing the right thing, and giving whatever audience we had a good show. The Chindia tour required something very different from me: I had to listen very thoughtfully to (and try to understand) people who knew a whole lot more than I did about operating in the region; I had to assimilate what they were telling me and respond with thoughtful and insightful questions; I had to look and act my best, even when I was feeling terrible (I also had to occasionally put on a good show). From these firm visits, I think I’ve started to internalize the concept of “face,” and how important it is do doing business in this theater. I’ve learned that it’s crucial to show the other party that you are professional (both in action and in appearance) and competent, and I’ve also learned that it is essential to give the other party an opportunity to show themselves off – to let them save face.

The English Corner visit was a very nice capstone for the trip, not only because it was a window to see the future leaders of China, it was also an opportunity for the Chinese to put a face with the American name. I hope that through my interaction with them that I’ve put a good taste in their mouth, and that they now think that we really aren’t all that bad. What surprised me about them was that many of the questions they presented me with were articulate, detailed, probing, sometimes personal, and very well thought out. They seemed to know more about the events going on in my country than I did; the only thing they lacked was a view of the “situation on the ground” in the United States. They wanted to know how I had personally been affected by the global financial crisis – had my friends and I been able to find jobs? Did we have friends or relatives who had trouble with their houses? What were the schools like? What were some American perceptions of Chinese students studying abroad? Unfortunately, our largest exports to China seem to have shifted towards money, empty cargo containers, sensationalist news, and pop culture television. I tried to assure them that the country wasn’t full of skinheads, drug dealers, and beat boxers, and that there were a lot of people who welcomed foreigners in with open arms.

Although I probably won’t have a very good understanding of what I’ve truly assimilated until I’ve been working for a few years and get sent on an international assignment, I think I’ve gotten an inkling about what India and China mean to the world. They are both fast moving cultures and economies – thirsty for parity with the prosperity they see in the developed world. India I see as a country full of people who are convinced that they can do a job every bit as good as someone else can, but at a better price. It is a country of contradicting dualities, with everyone trying to push to the front of the line and achieve all they can in life. It is a country of overt emotion, strong family ties, and unbreakable tradition. China I see as a country united in its effort to show itself off as equal, if not superior to the developed world. Everywhere I looked, I saw great monuments and structures meant to wow foreigners. I saw newly constructed artistic buildings and sleek black government cars – they weren’t trying to emulate the west; they were trying to show the west that it had to emulate them.

Aside from these informational knowledge and perceptive takeaways, I believe that this experience has given me a better understanding of my own potential. It has shown me that I have what it takes to think on my feet to describe and get a bag of ice from a woman who doesn’t speak English. It has shown me that I can injure myself and feel awful on the inside but still put on an appearance that will close the deal. It has shown me that I can meet and feel comfortable around a group of people I hardly know and very quickly get to know them. It has underscored to me the importance of forming relationships, both professional and personal, and it has demonstrated to me how lucrative they can be, both monetarily and emotionally. I consider this tour to be a once in a lifetime experience, and I am confident that I can look back to it for the rest of my life for advice and insight on the situations that I will face every new day.

Book Review for The Art of War

The Art of War

Author: Sun Tzu

ISBN: 978-1-56619-297-2, 0-19-501540-1, 0-486-42557-6

By: David Caldwell

Sun Tzu's The Art of War is an ancient Chinese text which has been used for dozens of centuries for its keen insight into military strategy. Recently, it has gained momentum for its application to modern business. While the origins of the text are considered to be dubious by some, there is no denying its unwavering relevance to civil and military models up through the 21^st century – while the players and machinery may have changed, the principles of warfare seem inalterable.

The text of The Art of War was translated into French in 1772, and is rumored to have been used by Napoleon as well as American officers during WWII. It is divided into the following 13 chapters:

1. Laying Plans
   
2. Waging War
   
3. Attack by Stratagem
   
4. Tactical Dispositions
   
5. Energy
   
6. Weak Points and Strong
   
7. Maneuvering
   
8. Variation of Tactics
   
9. The Army on the March
   
10. Terrain
    
11. The Nine Situations
    
12. The Attack by Fire
    
13. The Use of Spies
    

Before going into detail about what specific proverbs could be applied to, it seemed appropriate to consider what the "enemy" represented in modern business. After an exploration into the text and some additional reflection, it started to seem less like the nebulous ideas of scarcity of resources, inaction, or perhaps unprofitability, but was perhaps more properly defined as a competing firm.

Within these 13 chapters, myriad advice relevant to modern business can be extracted; this information can used to assist in the understanding of the subjects of Management-Employee Relations, Gathering Information and Planning, and Operations and Competition.

Management-Employee Relationships

A significant portion of The Art of War describes how leaders should relate to their subordinates. Today's Management-Employee relationships are actually very similar to ancient and modern military relationships in many ways: Sun Tzu's teachings can be applied toward incentives and motivation, leadership qualities, treatment of employees, decoding and interpreting behavior, and Organizational Behavior and Delegation.

Sun Tzu explains how leaders should motivate their subordinates with two different kinds of incentives. Firstly, "there must be an advantage from defeating the enemy, they must have their rewards." (II:16) Also, in his Maneuvering chapter, he says "when you plunder a countryside, let the spoil be divided among your men; when you capture new territory, cut it up into allotments for the benefit of the soldiery." (VII:20) In the same way, modern employees should be able to taste the fruits of their labor and increased effort – this is usually carried out in the form of commissions, profit-sharing, and performance-based bonuses. Another way Sun Tzu suggests for motivating subordinates is with fear, usually from the external environment. "The further your penetrate into a country, the greater will be the solidarity of your troops, and thus the defenders will not prevail against you." (XI:20) "Throw your soldiers into positions whence there is no escape….[they] will put forth their uttermost strength….If there is no help…they will fight hard….they will do your will, without restrictions, they will be faithful." (XI:23-25) "Place your army in deadly peril, and it will survive….For it is precisely when a force has fallen into harm's way that is capable of striking a blow for victory."While it is generally frowned upon to try to scare your employees into performing better, it can be beneficial to put them in situations where they feel challenged – many employees appreciate and can latch onto challenges as opportunities to demonstrate their capabilities; the difficulties that they face will also have the added benefit of keeping their skills honed.

The qualities of a good leader are also expressed in The Art of War. Rather than simply listing off what kind of person a leader should be, Sun Tzu discusses the kind of relationship he should have with his subordinates: they should be treated with respect, but should also know that there are consequences of disobeying. "Soldiers must be treated in the first instance with humanity, but kept under control by means of iron discipline." (IX:43) Commands must also be "habitually enforced…[a leader] insists on his orders being obeyed." (IX:44-45) That isn't to say that there is no room for grace or interpretation in an organization; rather, it is important for leaders to follow through with what they say they will do and not give the appearance of being pushovers; otherwise, their subordinates are likely to "be likened to spoilt children…useless for any practical purpose." (X:26) Along with inconsistency, Sun Tzu lists the following as behaviors for his leaders to try to avoid: "recklessness, cowardice, a hasty temper, a delicacy of honor which is sensitive to shame, and an over solicitude of his men." (VIII:12) Instead, he smiles upon leaders who advance "without coveting fame" and who "retreat without fearing disgrace" (X:24) – this is something that can be applied directly to present-day managers: stories seem to all too often emerge about executives who have put their personal reputation and glory above their job, and their performance has suffered greatly as a consequence. Managers whose "only thought is to...[do] good service" are considered to be "[a] jewel of the kingdom." (X:24)

Along with having the correct motivations, leaders must be able to interpret the different behaviors of their subordinates in an effort to stop problems before they start – they should "carefully study the well being of [their] men." (XI:22) For example "the sight of men whispering together in small knots or speaking in subdued tones points to disaffection." (IX:35) This appears to be quite applicable, even in modern times. Fortunately, this is not a task that a leader necessarily has to accomplish alone. Sun Tzu alleviates this burden by demonstrating the different facets of Organizational Behavior and outlines proper methods for delegation. One of the pitfalls he points out is "employing officers…without discrimination, through ignorance of the…principle of adaptation to circumstances." (III:15) In the same way, "he will win who…is not interfered with by [their leader]." Along with repeated warnings against micromanagement, Sun Tzu points out the need for a consistency of purpose and direction within an organization. "He will win whose army is animated by the same spirit throughout its ranks." (III:17) In ancient times, soldiers' "combined energy" (V:21) was harnessed and directed with drums and banners; today, documents such as mission and vision statements provide employees with management's expectations and gives them an idea about how they are expected to carry out their duties. One particular note of interest regarding organizational inertia is mentioned in the Maneuvering chapter: "If you set a fully equipped army in march in order to snatch an advantage, the chances are that you will be too late. On the other hand, to detach a flying column for the purpose involves the sacrifice of its baggage and stores." (VII:6) Lockheed Martin followed this advice with the creation of Skunk Works – a small Advanced Development Program (ADP), independent of much of the bureaucracy. Skunk Works was responsible for the quick development of a number of revolutionary aircraft.

Gathering Information and Planning

In order to set subordinates in the same direction, Sun Tzu emphasizes the importance of setting goals for operations and clearly communicating them; while this is an integral step for organizational success, choosing the right direction can only be accomplished with a concentrated effort towards gathering information.

Right from the first chapter, Laying Plans, Sun Tzu lays out the framework (I:13) for "forecast[ing] victory or defeat" (I:14) by explaining the how important acquiring information is, whether it be by environmental observation or spies, and with the application of planning and preparation. He states that "many calculations lead to victory, and few calculations lead to defeat." (I:26) This concept is demonstrated in the two sources of competitive advantage: luck and more accurate future expectations. By reducing the amount of uncertainty about their environment and gaining more information about the true values of assets, managers are more likely to secure higher than average returns. This type of information is useful when facing an adversary of similar abilities, but it becomes essential when facing a more powerful adversary: "though the enemy be stronger in numbers, we may prevent him from fighting. Scheme so as to discover his plans and the likelihood of their success." (VI:22 – emphasis added) This type of advice can also be applied in modern times to running scenarios and creating decision trees to try to anticipate and plan for an adversary's responses. It also puts a special emphasis on studying the failures of other leaders: "let them be a subject of meditation," (VIII:14) that way managers can avoid repeating the same mistakes in the future. Perhaps a more difficult to apply section of The Art of War deals with the acquisition of information using techniques of subtlety and deception; in fact, there is an entire chapter devoted to the use of spies – something that is severely discouraged in modern business practices. While agents of infiltration may no longer be an ethical method of acquiring information, techniques such as headhunting have become commonplace in the highly competitive business environment. Also, the passage "all warfare is based on deception" (I:18) can be interpreted as keeping plans secret or allowing another party to infer something erroneous (such as in negotiations or in poker). The following is a rather beautiful passage which seems to sum up the concept well: "At first, exhibit the coyness of a maiden, until the enemy gives you an opening; afterwards emulate the rapidity of a running hare, and it will be too late for the enemy to oppose you." (XI:68)

While gathering information is a crucial step in securing victory, it is meaningless without application; it must be used in preparation. Proper planning should enable an organization's energy to become like "the bending of a crossbow." (V:15) In modern terms, this might apply to having prepared blogs ready in case of incident. It might also apply to having a special acquisition fund in place in case valuable resources unexpectedly appear on the market. Proper preparation may also enable organizations to make the most efficient use of its resources: "knowing the place and the time of the coming battle, we may concentrate from the greatest distances in order to fight."(VI:19) Simply hoping against confrontation is a recipe for failure in modern business; rather, "the Art of War teaches us to rely not on the likelihood of the enemy's not coming, but on our own readiness to receive him; not on the chance of his not attacking, but rather on the fact that we have made our position unassailable." (VIII:11) This helps to introduce the idea of each organization having control over its own defeat – rather than seeking opportunities to conquer, Sun Tzu advocates that organizations "put themselves beyond the possibility of defeat, then wait for an opportunity of defeating the enemy." (IV:1)

In order to assist in the gathering and preparation the appropriate information and plans, a focus on detail orientation and logistics is encouraged. Several times in his work, Sun Tzu breaks down the cost of raising an army into an almost microscopic scale (II:1). He also introduces concepts which bear close resemblance to modern-day supply chain management: "the skillful soldier does not raise a second levy, neither are his supply-wagons loaded more than twice;" (II:8) "an army without its baggage-train is lost; without provisions it is lost; without bases of supply it is lost." (VII:11) This reminds us today not to simply take off running after grandiose ideas without stopping to consider what is necessary in order to implement them. One more plug that Sun Tzu makes for being detail oriented is mentioning that "it is always necessary to begin by finding out the names of attendants, the aides-de-camp, and door-keepers and sentries of the [enemy] general in command." (XIII:20) While this has innumerable benefits towards spying and corporate espionage, it can also have a far more benign yet useful purpose: administrative assistants are the ones with the real power nowadays.

All this being said, as Sun Tzu elucidates in his chapter about Tactical Dispositions, "one may know how to conquer without being able to do it." (IV:4) Information and planning are nothing without the resources with which implement a strategy. Also, "when your weapons are dulled, your ardor damped, your strength exhausted and treasure spent….then no man, however wise, will be able to avert the consequences that must ensue." (II:4) That is to say, no one can completely predict and plan for the future – they must be willing to face it in real-time, sometimes unprepared.

Operations and Competition

Conducting ongoing operations and deciding on how to meet competition stands as the most intense focus of The Art of War. Sun Tzu covers a wide array of topics, including conducting operations efficiently, adaptation, spheres of control, causal ambiguity, negotiations and behavior interpretation, acquisitions, and principle-agent relationships. Fortunately, all of these topics have very relevant and applicable lessons for the business world of today.

A key tenant in Sun Tzu's strategy is expending the minimum amount of energy to accomplish goals while simultaneously forcing the competition to expend a maximum in pursuit of its goals. "The skillful leader subdues the enemy's troops without any fighting; he captures their cities without laying siege to them; he overthrows their kingdom without lengthy operations in the field." (III:6) As previously stated, information can be very helpful in enabling victory; it is essential, however, in ensuring that it is undertaken efficiently: "by discovering the enemy's dispositions and remaining invisible ourselves, we can keep our forces concentrated, while the enemy's must be divided." (VI:13) Keeping the source of one's own strengths hidden makes strategic advantages much more difficult to imitate; by creating a causal ambiguity among your core competencies, competitors will drastically lose their ability to assess and undermine your plans. "Amid the turmoil and tumult of battle, there may be seeming disorder and yet no real disorder at all; amid confusion and chaos, your array may be without head or tail, yet it will be proof against defeat." (V:16) In the same way that defeat can be avoided when an "opponent does not know what to attack," so also victory can be achieved when an "opponent does not know what to defend." (VI:8)

In the same way that keeping intentions and objectives hidden can be an invaluable skill in negotiations, it is important to also be able to distill signals from different behaviors. Sun Tzu shares some of his own observations in this area: "humble words and increased preparations are signs that the enemy is about to advance. Violent language and driving forward as if to attack are signs that he will retreat." (XI:24) "When envoys are sent with compliments in their mouths, it is a sign that the enemy wishes for a truce." (IX:38) In both these cases, Sun Tzu is anticipating that his rivals will make an attempt to deceive him to gain the upper hand. Interpreting non-verbal behavior can also be extremely useful in one's own organization. As Sun Tzu interprets "soldiers leaning on their spears" as "faint from want of food" and water gatherers "beginning by drinking themselves" as a thirsty army, so must a leader make an effort to interpret the behaviors of his subordinates to try to discover where hidden problems lie.

In all cases, whatever the competition may be trying to accomplish, it is vital for an organization to maintain its adaptability and choose appropriate market positions for different situations. "If our forces are ten to the enemy's one, surround him, if five to one, attack him, if twice as numerous, divide our army in two." (III:8) In the same way, modern businesses will need to perform a comparative analysis between itself and the competition to see if acquisitions, direct competition, multi-point competition, or some other strategy is appropriate. Sun Tzu also demonstrates when seeking to be a first mover is desirable: "whoever is first in the field and awaits the coming of the enemy will be fresh for the fight; whoever is second in the field and has to hasten to battle will arrive exhausted." (VI:1) "With regard to narrow passes, if you can occupy them first, let them be strongly garrisoned and await the advent of the enemy." (X:8) In the same way that businesses cannot expect for conditions to remain static over time, neither should they allow their competition to sit unchallenged to build up their strength; after all "an army may march great distances without distress, if it marches through country where the enemy is not." (VI:6) Therefore, "if the enemy is taking his ease, [you should] harass him, if well supplied with food, [you should] starve him out; if quietly encamped; [you should] force him to move." (VI:4) Facing an opponent on multiple fronts may actually require a fair amount of adaptation by the aggressing firm; it may be necessary to pursue different strategies (e.g. price or product differentiation) in order to combat the competition. Much to the chagrin of many engineers, there is very infrequently any "generic solutions" to problems: "therefore, just as water retains no constant shape, so in warfare there are no constant conditions." Business managers need to constantly be observing how the competitive landscape is changing and coming up with new innovative ideas for adaptation.

As mentioned earlier in the section about making preparations, it is ultimately organizations themselves which hold control over their own defeat. "To secure ourselves from defeat lies in our own hands, but the opportunity of defeating the enemy is provided by the enemy himself." (IV:2) Far too often, managers view their sphere of control as too restrictive and seek to expand and compete – even if there is no justifiable reason. In fact, a deal of empirical research has shown that acquiring firms gain little value when expanding and acquiring other companies. Sun Tzu advocates that leaders should be certain of victory before beginning the battle: "in war the victorious strategist only seeks battles after the victory has been won, whereas he who is destined to defeat first fights and afterwards looks for victory." (IV:15) At the same time, care must be exercised not to be too ruthless in combat; as an animal can act its fiercest when backed into a corner, "when your surround an army, leave an outlet free. Do not press a desperate foe too hard." (VII:36) Sometimes, being the first to a market can be a disadvantage for a company – this can occur when significant and costly research must be done to enter a field, but the results of the research are easily imitable. "In a position of this sort, even though the enemy should offer us an attractive bait, it would be advisable not to stir forth, but rather to retreat, thus enticing the enemy in his turn; then, when part of his army has come out, we may deliver our attack with advantage." (X:7) Sun Tsu drives home his exhortation not to act unnecessarily late in the text with the following passage: "move not unless you see an advantage; use not your troops unless there is something to be gained; fight not unless the position is critical. No ruler should put troops into the field merely to gratify his own [splendor]; no general should fight a battle simply out of [resentment]. If it is to your advantage, make a forward move; if not, stay where you are." (XII:17-19) In the same way, managers should not push for expansion just to stroke their egos; they should not expect that operations will function better simply because they are now in charge of them – this is the height of managerial hubris.

When the time is appropriate, however, for expansion, The Art of War lends a hand in how to conduct acquisitions. In his chapter on Waging War, he makes multiple references to "foraging on the enemy." (II:9, II:15) Today, this can take the form of acquiring not only a firm's assets, but also its competencies. While integrating a new acquisition into an existing management process can be expensive and time consuming, it does not necessarily need to be enveloping, especially in areas where the acquiring firm has little to no experience. "One cartload of the enemy's provisions is equivalent to twenty of one's own," (II:15) not simply because it is depriving the enemy of those resources, but because the capturing firm is saving on the resources that would have otherwise been spent on getting those resources to where they are needed. In the same way, a company pursuing a plan of international expansion may wish to retain a large number of Host Country Nationals (HCNs) and take advantage of their existing networks. Before pursuing new acquisitions or alliances, Sun Tzu warns that organizations should not forge alliances "until [they] are acquainted with the designs of [their] neighbors." Today, to ensure that new acquisitions and alliances will be worthwhile and profitable, companies must perform their "due diligence;" otherwise, they have no one to blame but themselves.

The final point for modern day managers to gleam from this text is to remember that they answer to someone, the same way a general answers to his sovereign in a principle-agent relationship. In the same way "the general receives his commands from the sovereign," (VIII:1), so managers are commissioned by stockholders to use their investments to the best of their ability. One very strange application from The Art of War to today's business practices arises when generals are called to countermand their sovereign's orders. In his chapter on Variation in Tactics, Sun Tzu states that "there are roads which must not be followed, armies which must not be attacked, towns which must be besieged, positions which must not be contested, commands of the sovereign which must not be obeyed." (VIII:3) This raises the question of when (if ever) it is appropriate for managers to go against the direction of their superiors in pursuit of what they believe is "the greater good." Sun Tzu offers a small clarification later in his chapter on Terrain: "if fighting is sure to result in victory, then you must fight, even though the ruler forbid it; if fighting will not result in victory, then you must not fight even at the ruler's bidding." (X:23)

Reflections

In today's society (and perhaps in the society of Sun Tzu thousands of years ago), we smile upon our agents behaving not simply as robots, but as rational human beings; this concept may seem very hard to swallow in a military setting, as soldiers are typically expected to do whatever they are ordered to, even if it results in their demise. Granted, there are certain exceptions to this rule in combat, nested in international law and treaties (e.g. in the Geneva Convention). Perhaps this then is the direction from which to consider the problem from the business perspective. For example, it might be appropriate for a manager to countermand his superiors if he were asked to undertake unethical activities, or perhaps in a situation where he knew that his compliance would result in significant monetary, property, or human loss. As mentioned before in the section on adaptability, there are no "generic solutions" for this issue; they must be judged on a case by case basis – it's the best tool we have.

One particularly interesting point to consider in this context is the concept of defeat in the modern business world – how does it translate to operations with a competing firm? Should the goal be to run rivals out of business or perhaps merely to prevent them from bankrupting your firm? There is a bit of detachment between the black and white activities of the past and the more nebulous structures of today's businesses. In many cases in ancient times, armies were not created for the purpose of maintaining order or providing security in case of incursion, they were a tool constructed to meet a very real threat, and generally their purpose was singular: to destroy the enemy. Businesses today appear much better suited for ongoing operations, with more of a focus on competition than survival. Perhaps the closest military analogue was the buildup of US and Soviet forces during the Cold War – both sides were in a perpetual struggle to gain the upper hand, but neither side so much as scratched the surface of their arsenal against each other for almost half a century – it is unclear whether the US demonstrated the quintessence or the antithesis of Sun Tzu's ideas relating to efficient combat in defeating the Soviet Union.

Although it may seem like a bit of a coarse fit in certain situations, The Art of War stands as a timeless tome of strategy and wisdom. Its persistent applicability, even across time and subjects, is uncanny. It is my prediction that it will continue to be found relevant to civil, business, and military minds for years to come. In his own words, Sun Tzu declares that "[The Art of War] is a subject of inquiry which can on no account be neglected." (I.2)

Citations and additional sources are arranged as follows:

• Management-Employee Relationships
  
  • Incentives and Motivation
    
    • Rewards (II:16, VII:20)
      
    • Fear (XI:20, XI:23-25, XI:44, XI:58-59)
      
  • Leadership Qualities
    
    • Treatment of Employees (IX:42-43, IX:44-45, X:25-26, XI:35-39, XI:57)
      
    • Behaviors to Avoid (VIII:12, X:24)
      
  • Skills required
    
    • Decoding Behavior (IX:35, XI:22)
      
    • Organizational Behavior and Delegation (III:13, III:15, III:17, V:1, V:2, V:21, VII:6, X:16, X:17)
      
• Gathering Information and Planning
  
  • Setting Goals (II:19,VI:27, VII:24)
    
  • Gathering information
    
    • Environmental Observation (I:13-14, I:26, VI:22-23, VIII:14, IX:18-23)
      
    • Subtlety, Spies, and Deception (I:18, IV:8-9, XIII:4-6, XI:68)
      
  • Being Prepared (V:15, VI:19, VIII:11, IV:1)
    
  • Detail Orientation & Logistics (II:1, II:8, VII:11, XIII:20)
    
  • Limitations (II:4, IV:4)
    
• Operations and Competition
  
  • Efficiency (III:6, V:19, V:20, VI:13, VI:17, VII: 14)
    
  • Causal Ambiguity (V:16, VI:8)
    
  • Negotiations & Interpreting Behavior (VII:28, IX:24, IX:29-31, IX:38, XI:18)
    
  • Adaptation & Market Position (III:8, IV:6, VI:1, VI:4, VI:6, VI:10, VI:31, X:8, X:10-11, XII:14)
    
  • Spheres of Control and Choosing Battles (IV:2, IV:14, IV:15, VI:11, VII:36, X:6-7, XII:17-19)
    
  • Mergers and Acquisitions
    
    • Making Use of Appropriated Resources (II:9, II:15, III:1)
      
    • Due Diligence (VII:12, XI:52)
      
  • Principal-Agent Relationships (VIII:1, VIII:3, X:23)
    

A copy of the text can be found here:

http://classics.mit.edu/Tzu/artwar.html

Book Review for Billions of Entrepreneurs

Billions of Entrepreneurs

Author: Tarun Khanna

ISBN: 978-1-4221-0383-8

By: David Caldwell

Tarun Khanna's book is broken up into three parts, entitled: "Foundations," "Enterprise," and "Future." Foundations deals primarily with the history of China and India in the international arena, describing the types of social policies they have pursued, and noting some key differences in the ways they have attempted to curb their social and economic problems. Enterprise introduces several case studies of multinational organizations that have attempted to move into the region, as well as how each country focuses on rural and urban development, and what their approaches to healthcare are. Future is actually a short look into the recent past, and an explanation of how corporations have been key to developing a Sino-Indian synergy in recent years.

Part I, "Foundations," details the recognition of both China and India entering into the world economy in the late 1940s, but doing so "in vastly different ways." (P. 21) Each chapter considers various aspects of how the two countries manage their citizens, and the natural outcomes that result. These very different choices of action are "based on deeply held beliefs about appropriate societal norms." Governance is described by Khanna by juxtaposing Indian and Chinese houses of parliament: the Rajya Sabha and Lok Sabha for the Indians, and the National People's Congress for the Chinese. Both houses' behaviors are described: the Indian's being laced with emotional disagreements and arguments over petty issues, and the Chinese' being orderly and virtually unanimous in their decision making. (P. 33) While Khanna separates them more and more with his descriptions, he also mentions that both fiery emotionalism and "dearths of audible dissent" do not allow either government's houses to "engage in meaningful debate." (P. 34) Along with behavior, Khanna describes training and research organizations in places such as the Shanghai Party Institute and the Parliamentary Research Service (PRS), "an independent nonprofit research initiative" (P. 36) for allowing policymakers to make fact-based, intelligent decisions for their constituents.

For the next part of his text, Khanna outlines how the Chinese and Indian governments came to the conditions they are at today – he is focused on "what legacy...each country inherit[s] and shoulder[s] as it opens up to the twenty-first century." (P. 39) Khanna begins by detailing the history of China, which has been based on order, harmony, and hierarchy since the Chinese civil war in 1949. This effort began with Mao Zedong establishing state control over banks, agriculture, and production - aligning the country with the Confucian tradition. Two of the more tragic externalities of this realignment were a massive man-made famine, and a bloody Cultural Revolution. After Mao's death, Deng Xiaoping brought with him a significantly new way of thinking: he began to transition towards a market economy by focusing leadership selection more on skills and abilities instead of party loyalty or "ideological purity." His actions perpetuated "an entirely new generation of educated, high-caliber bureaucrats whose success is still felt today." (P. 43) Khanna then details the history of India, which is defined by words like plurality, democracy, and decentralization. India has had a success in "includ[ing] several disparate historically disenfranchised groups" (P. 45) in government, but has done so "at the expense of useful collective action." Unfortunately, a government of this size and with this amount of autonomy required "several layers of horizontal and vertical chains of command," making policy implementation slow and cumbersome. Nehru believed that the economy needed to run under the control of the public sector in order to ensure that investment in critical, though unprofitable enterprises, like agriculture, would continue.

The Indian and Chinese financial situation is contrasted to demonstrate the conditions in each country's development. Khanna first brings up infrastructure creation: Why China can build cities overnight and India cannot." (P. 69) The city of Pudong in China, once a "marshy farmland" has undergone massive development by the Chinese government in an effort to "attract foreign governments and international financial institutions." (P. 71) Due to relaxation of regulations in the area and governmental incentives for development "Pudong's economic output nearly equals the total output of Shanghai ten years ago," though at the cost of (forcibly) displacing three hundred thousand farmers – something that would never fly in India. In India, a similar situation exists, but it was created under radically different circumstances: the Machimmar Village places "premier real estate" next to a poor fishing village. (P. 73) Unlike China, strong social forces prohibit the "[deprivation] of their slender means of livelihood." Under the law, "the object of all development is the human being." (P. 74) The main point that Khanna is trying to convey is that China is able to rapidly pursue development projects with little to no resistance, but that in India, respect for the individual overrides the desire for economic development.

The last section of Part I describes the history of China and India's stock markets, and the approach that each country has taken to try to correct perceived problems. In India's case, the Bombay Stock Exchange (BSE) had "little disclosure of transaction prices, serious paperwork problems, and an unreliable clearing and settlement system." (P. 94) It was also ripe with insider trading and scandals. To combat these problems, the government authorized the creation of the National Stock Exchange (NSE) to compete with the BSE. The NSE was created with transparency, separation from governmental influence, and technological modernity in mind. Soon, the NSE overtook the BSE in current trading, even prompting fear that "the BSE [would] go out of business and therefore hamper competition." (P. 99) India's story can be summed up as: "The government had tried forever to persuade BSE to reform….competition worked when regulation and threats did not." China's stock market, on the other hand, looks to be in a much less healthy situation. With prices on stocks all moving the same direction at the same time, it is very difficult for potential investors to distinguish a Chinese firm's performance from that of the market's. According to Morck and Yeung, "There was virtually no other country where the stock price data was as comprehensively meaningless as in China." (P. 105)

Part II, "Enterprise," moves from focusing on the government to examining the role of industry (both domestic and international) in China and India. Two chapters, "Infosys and TCL" and "Microsoft and Metro" tell of the struggles that individual firms face when trying to increase their market share in an international arena. Infosys, a small Indian company "founded in 1981 by seven engineers on a shoestring budget of $1,000" (P. 123) struggled to be taken seriously by American companies it was offering its services to. There was a perception from the CIOs that "an Indian company [couldn't] build the large applications they needed." Infosys managed to clear this hurdle by demonstrating world-class performance and adherence to GAAP and new NASDAQ regulations quickly. Microsoft faced a somewhat opposite challenge: although they were quickly becoming the dominant operating system on the planet, and were performing very well in their home market, they had immense trouble moving into China. Two factors inhibited their success: 1) rampant piracy, 2) it wasn't in the interest of Chinese government for Microsoft to capitalize on an opportunity that took away from the livelihood of its software shell developers. Originally, Microsoft sent Bill Gates to "Beijing to convince President Jiang Zemin that blacklisting his company's software was a mistake and that it was in China's interest for Windows to become the standard operating system, as it was in the United States." (P. 143) Unfortunately for Microsoft, anticommunist slogans embedded in the software and Chinese fears over Microsoft stealing state secrets was not enough to convince President Zemin. What followed was a slow, uphill battle: Microsoft had to make a number of concessions, including releasing its closely guarded source code and creating a joint venture with "the Chinese companies Centergate Technology and Stone Group." (P. 147) By maneuvering into a position that the government considered to be helpful to the Chinese, Microsoft was eventually considered a "friend of China." (P. 142)

The next section of the text began to describe China and India's relationship with its diaspora, "a dispersion of an originally homogeneous entity, such as a language or culture." (http://en.wiktionary.org/wiki/diaspora) Functionally, this term includes Non-Resident Chinese and Non-Resident Indians living in other countries. The text goes into detail about a transportation company, Fung Wah, founded by an entrepreneur named Liang Peilin. Peilin's business centered around transporting parents of Chinese students (i.e. diaspora) in the New York area. Originally shunned by the Chinese, the diaspora, "collectively referred to as huqiao huaren…'citizens living overseas,'" were lured back to China by Deng Xiaoping for their "wealth and investment." (P. 170) India's relationship with its diaspora has benefitted significantly from their economic prosperity, especially in the Silicon Valley area and in London. When India was in dire economic straits, the Non-Resident Indians quickly came to its aid: "The government had to prematurely close [an] issue because it rapidly exceeded its $2 billion objective by 100 percent." (P. 184)

The last two chapters of Part II describe Indian and Chinese strategies for managing the rural villages, both in terms of how workers should be organized, and how health care should be provided. Health care in India has developed largely independent of the state; one organization, SEWA, the Self Employed Women's Association, works hard to empower women throughout India, training them as "mobile doctors," pump repairwomen, and farmers, and teaching them how to save. (P. 199-203) Sadly, "despite its seven hundred thousand members…SEWA touches too few." (Page 207) Large-scale implementation in India was not as simple: "Gandhi and Nehru held opposing views. Nehru favored Soviet-style central planning and an emphasis on industrialization. Gandhi…advocated rural and small-scale industrial development, with an emphasis on the nation's half million villages." (P. 203-204) Bhim Rao Ambedkar, the framer of the Indian Constitution, feared that pursuing a gram swaraj, or "village republic" would be tantamount to reverting to India's ancient caste system. Khanna then describes how caste voting blocs had been used to sway elections in favor of anti-poverty candidates, such as Indira Nehru; however, Khanna points out that "an even brighter future lies in Indian corporations….corporate India is immune to the short-term temptations of pandering to caste-based divisions." (Page 207) This infusion of private capital is the power behind the issue of medical tourism mentioned in Chapter Ten. Working in an area that serves many more people than American hospitals, Dr. Devi Shetty explains that economies of scale are leveraged to provide cost effective healthcare to the poor, the well-to-do, and the price-conscious foreigner. He and other medical practitioners have begun to make extensive use of information technology in order to provide remote diagnosis. One again, "entrepreneurship…is an exception amid India's public-sector health failure." (P. 218) By underspending on preventative treatments, India's health system has doomed itself to endless "fire fighting." China's experience has been more successful in some areas, and less successful in others. Although standardization and transparency has been growing in the Chinese medical community, deregulation of healthcare following the economic reforms in 1978 has flooded the countryside with unlicensed and untrained medical staff. Additionally, the systemized protection of certain procedures has incentivized risky and unnecessary surgeries.

Part III, "Future," begins to deal more with the modern history of China and India's interactions with the eastern and western world. After a detailed description of involvement in Burma, a country now full of diaspora, Khanna explains how soft power has been historically developed in India: primarily through the country's massive film industry. Soft power in India through film comes primarily from a decentralized message of "its diversity [and] its entrepreneurial spirit." (P. 260) In fact, "the government was completely disinterested and uninvolved. Perhaps that was one reason for its resounding critical and financial success." (P. 262) This is strongly contrasted with China's "disciplined approach to attaining power" (P. 260) in the world. When films began to grow in popularity in China, it was not through artistic channels or for social commentary – almost all films were political in nature; full of propaganda, they espoused the notion of "growth first, freedom later." (P. 268) The development of Chinese soft power instead came through the export of some of its relaxation and focusing techniques, such as Tai Chi.

Films were not the first foray into the development of Indian soft power: Buddhism, a belief structure that originated in India, became hugely popular in China over a thousand years ago. The pilgrimages between the two countries were instrumental in the creation of commercial linkages. Unfortunately, in the 8^th century, there was a "perception that monks were exploiting the local citizenry. Emperor Wuzong…responded by ordering the general destruction of all Buddhist establishments, corrupt or otherwise." (P. 284) Modern Sino-Indian interaction, though beset by border disputes and policy differences, has moved forward strongly in recent days, especially in the region of software and hardware development. China lacked what was necessary to create a software industry on its own: "analysts argued that it was unlikely that a software industry would take hold in a country where intellectual property rights were not protected." (P. 287)

Part III continues with stating that of the many efforts of outside parties to change China, "China has changed them." (P. 295) He cites corporations as the dominant force for instituting change in China and India – by "helping citizens engage more fully in the world economy." (P. 295) This engagement came not through giving away money, but by finding ways "to allow people in Chinese society to productively participate in its business ventures." (P. 297) In order to develop the talent necessary to thrive while abroad, CEO of GE Healthcare China, Chih Chen, realized that it was necessary to develop people horizontally: to "hire one person with double the pay but expect that person to do the work of three," (P. 299) rather than using the traditional Chinese paradigm of only vertical movement within a profession. He further crafted GE corporate language in Chinese revolutionary rhetoric that "seasoned Chinese veterans could relate to and understand." (P. 299) While GE has had success in marketing its products in the Asian market, product development outside the U.S. was described as a "disaster." "The Indian mind-set was never focused on reliability. We shipped fifty units to Brazil, Indonesia, and China. Forty-nine came back with problems, and the fiftieth was lost in transit." (P. 305) Software development in India was much more successful. International operations have begun to be self-sustaining abroad: "as many multinationals have localized, there are fewer expats coming and going." (P. 307) This requires dramatically less time and resources to interact with the local governments.

The text ends with a quote by an executive regarding GE subsidiaries in China and India: "The ability to set up parallel groups of highly skilled engineering talent in both countries is invaluable. It raises the efficiency of product development and fits in with a competitive culture within GE….Each country manager is charged with leveraging the collective strength of all GE units in the country." (P. 310-311) This underscores a broad trend: countries that allow foreign corporations to expand into their local markets are happy to have them, not because of the products they sell, but because of the "company focus on providing employment and transferring learning in the process." (P. 311) Competition with indigenous vendors may be seen as an incursion. To operate globally, companies must realize that they will only find success by realizing that host countries have a self-interest, and that this self-interest must be considered and appealed to when considering international expansion. Khanna concludes by noting that "the crucial lesson of companies…is that enlightened self-interest need not be a zero-sum game. That is the key to resilient bridges between East and West." (P. 312)

Oscars

So how about that Slumdog Millionaire?

What’s a Caste System?

I came across a rather depressing piece while browsing the internet: an exposé about an Indian worker named Rewa Ram, entitled "My life cleaning Delhi's sewers." The article describes the job of one of India's lower castes: the untouchables, or "Dalits." While just reading about Ram's experience is enough to induce nausea, he says "I am not educated, I come from a very poor family of untouchables. What else can I expect...At least I have a government job and I am able to feed my children. I get into this hell every day but then this is my job…I live smelling death, but it is fine." Ram's response seems of indicative of a glass ceiling above the lower classes. When I started to think more in depth about what kinds of influences were keeping the Dalits down, I realized that I had almost no understanding of the caste system or social stratification – it's just not something that I've ever had a lot of exposure to. This is why I'm so excited about getting to go to India to learn about their society first-hand.

Related to the previous article, I stumbled across another piece that caught my interest: a Fora.tv video about The Privatization of Water. While I don't claim to be any sort of environmental advocate, one part of this video caught my attention. Alan Snitow talks briefly about how much more expensive bottled water is than municipal water sources, but American consumer guilt isn't what he's interested in. At 00:35:45 into the talk, he mentions that the "real problem [he] sees with bottled water is best seen in other parts of the world." Specifically, he observes than in India, the middle and upper classes drink bottled water because there is a perception that the municipal water supply is unhealthy. As a result, the only support for improving public water systems comes from the country's poorest citizens – essentially limiting their access to clean, affordable water by robbing them of any sort of political clout.

Snitow chastises the privatization of water sources all over the world by companies such as Nestle, Coca Cola, and Pepsi. This grates harshly against my experiences with business and education – until now, I've been a staunch believer that private industry was the best way to get many things done; after all, competition brings out the best in people, right? When I'm talking to my friends about a poor performance or a substandard service, I often jokingly say that "it's good enough for government work!"

To reconcile these two conflicting ideas, I'll have to think back to our Macro Economics course (GSB 533) last spring, in which Dr. Marlow taught us that when governments create restrictions and incentives in markets, they may achieve certain social objectives, but it won't be as efficient an allocation of resources to their highest value uses as if the government had embraced a laissez-faire attitude. I appreciate that at the end of the day, we didn't learn whether governmental intervention was right or wrong, but that it was up to us to decide what we thought was the most important, and to act accordingly to pursue those goals. As it pertains to Rewa Ram, it's up to the Indian government to decide whether or not it wants to resist foreign and domestic investment in municipal replacements at the cost of efficiency, or if it wants to embrace them at the cost of its most destitute people.

Capturing Memories, the New Fashion Way

Capturing pictures and video on trips seems to be one of the best ways to immortalize the experience. During the last four trips I've made abroad, I've tried to snap as many as I could – each time improving my technique, equipment, and post processing. This trip to China and India will be no different.

Firstly, I'm considering purchasing a DSLR camera to try to catalogue the experience. Initially, I was planning on waiting until I had graduated and landed a job (this, could afford it) to pick one up, but an experience like this may only happen once in a lifetime. I've had a chance to play with one of my friend's Nikon D80s and a Canon Digital Rebel, and I heartily enjoyed both of them. I even found a large amount of satisfaction playing with the pictures I took with post processing.

Secondly, since purchasing a new GPS equipped mobile phone, I've been having hours of fun plotting routes, geocaching, and listening to Jane, my British-voiced navigator, tell me to "take the motorway." A capability of this handset that I took a quick liking to was an ability to geotag photos – essentially printing latitude and longitude coordinates in the metadata of a picture. While this works fine and dandy if you don't care about having high quality pictures or if you have an unlimited data plan (with which to upload your shots), it just won't do the job when I travel abroad. However, after some extensive research, I've come up with a solution:

1: Bring my phone along, but put it on airplane mode for the duration of the trip (so as to avoid expensive international calls and data charges).

2: Tell my phone to log its location using a program called GPS Tracka (note: GPS Signals are sent down from a constellation of satellites, and are simply received by a GPS receiver – thus negating the problem of needing data service.

3: Take lots of pictures, either with my current Canon SD 600 or one of the above options.

4: Tag the pictures with the GPS data collected from Step 2, using two programs called COPIKS Photomapper (for large scale, up to the minute location information) and GeoSetter (for small scale, up to the second location information).

5: Upload the photos to any location-supported picture website, such as Picasa or Flickr (hurry up, Facebook!).

Well, that's the plan; with any luck, when I get back, I'll have a huge map chocked full of pictures of new and interesting places that I've visited, just like this one!

Book Review for The Post-American World

The Post-American World

Author: Fareed Zakaria

ISBN: 978-0-393-06235-9

By: David Caldwell

Fareed Zakaria's book The Post-American World traces the history of the United States' and Western World's dominant position in the world, details its current strengths and weaknesses, and predicts an outcome that he believes will continue to increase prosperity in America for years to come. Zakaria begins his work by describing exactly what he means by a post-American world: a place where the United States has not fallen into disarray and dysfunction, but rather a country surrounded by and accepting the "rise of the rest."

Zakaria begins by noting that "this is a book not about the decline of America but rather the rise of everyone else." (Page 1) He highlights several countries with up-and-coming economies and high growth rates that he believes will begin to challenge and compete with the United States economically in the near future: countries like China, India, Russia, Brazil, and Mexico. He then goes on to observe that many of the "biggest and bests" in the world are beginning to pop up outside America. He does acknowledge, however, that many of these countries that appear to be growing quickly still harbor "hundreds of millions of people living in desperate poverty," (Page 3) though their respective countries' growths have gone a long way to decrease the amount of people living under a dollar a day.

One of the more insightful and helpful parts of Zakaria's text was Chapter 3: "A Non-Western World." In this section, he gave a brief history of different nations' approaches to expansionism, development, technology, and leadership. Geography seemed to be one of the predominant factors in the advancement of the Western world beyond the Eastern. As the text explains, China had a very large and powerful merchant and military naval force; however, limited financial returns and external land-based threats largely caused them to abandon their sea-fairing expeditions – even going so far as to destroy the very plans (technology) that allowed them to build their great fleets. Additionally, Zakaria addresses the fallacy that "China and India were as rich as the West right up until the 1800s," and that the West's advancement was "largely accidental—the result of 'coal and colonies.'" (Page 52) He addresses this fallacy by observing that these large Eastern countries may have had an enormous GDP at the time, but that their GDP per capita and economic growth were vastly inferior to the West's.

Many of these advantages stemmed from technological innovation and application; inventions like reliable clocks and cannons were introduced to China, but the Chinese "saw little value in [them]." "China could consume modern technology, but it could not produce it." (page 56). By placing so much authority in a central ruler who had "closed [his] mind to the world," the Chinese stifled their economy's growth rate. Granted that the Eastern countries of the day were able to produce feats of grandeur and opulence, such as Beijing's Forbidden City, the Taj Mahal, and eventually a Soviet space program; however, Zakaria identifies these special projects as successes—but isolated successes." A country with unlimited control over manpower and taxation can assemble just about anything – it doesn't mean, however, that the project will be profitable or very useful for its citizens. Zakaria quotes economic historian David Landes, who "concludes that China failed to 'generate a continuous, self-sustaining process of scientific and technological advance'….even when there was knowledge, there was no learning." (Page 60) Another factor in limiting the economic growth of the East was that "Asian rulers largely fit the stereotype of the Oriental tyrant….their rapacious rule consisted of demanding taxes and tributes and building palaces and forts while neglecting infrastructure, communications, trade, and discovery." (Page 62) Commerce, as we know it today, could not exist: "no one had much of an incentive to build wealth, since it was likely to be confiscated."

Perhaps one of the strongest forces to contribute to the success of modern America was the success of the older Western nations – specifically the accomplishments of colonial England – their exports of the English language and culture primed the world landscape for large scale American trade interaction. Unfortunately (for Britain), they were unable to sustain their colonial ambitions indefinitely, eventually reaching economic ruin due to events such as the Boer War, World War I, and World War II. Europe was in tatters by the 1940's; America, largely insulated from the violence and rich with new technological advances, political clout, and a populace hungry for an end to rationing, leapt ahead of the rest of the world in production: "when the rest of the industrialized world had been destroyed …America's share rose to 50 percent [of global GDP]." (Page 181) Since the end of World War II, Zakaria states that the United States has been virtually unchallengeable militarily. An important point to note, however, is that "American military power is not the cause of its strength but the consequence." (Page 182)

Looking to the future, Zakaria believes that advances in technology, especially those related to Nanotechnology, Biotechnology, and Engineering, will continue to flourish on American soil, but that manufacturing and services will continue to transition abroad to locations of lower prices. One of the factors that Zakaria points out as being responsible for these shifts is in education. Large amounts of educational inequality exist throughout the United States – usually highly correlated to socioeconomic status. One of America's great redeeming qualities with reference to education is that "other educational systems teach you to take tests; the American system teaches you to think. It is surely this quality that goes some way in explaining why America produces so many entrepreneurs, inventors, and risk takers. In America, people are allowed to be bold, challenge authority, fail, and pick themselves up." (Page 193) In fact, countries that have scored better than the United States on diagnostic tests have begun to send officials to visit U.S. schools to "learn how to create a system that nurtures and rewards ingenuity, quick thinking, and problem solving." (Page 194) America, still the melting pot of many nations' peoples, is using its diverse workforce and entrepreneurial spirit to move ahead economically.

With the most powerful military force in the world, a strong but slowly growing economy, and a population of free-thinkers, it seems difficult not to think of America as a hegemonic figure in the world; after all, they pursue more unilateral military and economic actions and win more Nobel Prizes than anyone else in the world. Zakaria concludes his book with Chapter 7: "American Purpose." Although Zakaria states that the United States will most likely stay militarily dominant in years to come, he concedes that the "rise of the rest" will require it to focus more on soft power. He then offers six guidelines for America to follow:

1. Choose. The United States needs to decide whether to pursue regime change or policy change when dealing with the countries it finds to be hostile.
   
2. Build broad rules, not narrow interests. The United States cannot treat every nation it has relations with as a "special case." They should also realize that "if it has its own exceptions, so do other countries." (Page 239)
   
3. Be Bismarck not Britain. The United States should try to "have better relations with all [other countries] than any of them [have] with each other." (Page 241) America requires an appearance of legitimacy and trustworthiness if it wishes to deal with other nations profitably and equitably (See point 6).
   
4. Order à la carte. The United States should be willing to use small "work-arounds" to handle different types of security and diplomatic issues. America should stop acting unilaterally as "the world's policeman," and allow organizations and countries to handle some situations. The United States would be more effective if it acted in a moderator.
   
5. Think asymmetrically. The old military style of fighting wars army against army is obsolete (at least for the United States). America needs to recognize the ease with which smaller, less sophisticated forces can be effective – to solve these issues, more tools, such as nation-building and intelligence gathering for foreign countries should be used, and partnership with "foundations, universities, charities, and private individuals" (Page 247) should be explored.
   
6. Legitimacy is power. Lacking legitimacy has proved to have disastrous consequences for the United States in recent years: popular support, both at home and abroad, has dropped to very low levels, producing animosity from the people we are supposedly "helping," and denying us financial and military support from the international community. More effort should be expended to try to align the interests of other countries with our own via "attentive diplomacy." America needs to erase its image as "Mr. Big," and try to transform the world with its ideals.
   

Upon completing Fareed Zakaria's book, I was encouraged to find that he considered many of the problems apparent today from a historical perspective. It seems lately that most policy-makers have memories that only last for about 6 months, and that they are only convinced with short-term solutions and 10 second sound bites. Zakaria spent a good deal of his text going back to explain how the East and West had different environments and ruling styles had contributed to differing growth rates. Perhaps it was taken for granted, but I felt that not enough of the text was devoted to the events after World War II and the rise of globalization (1945-1999). I strongly appreciate how current events in 2008 were mentioned in the book – recent events tend to not be addressed in most publications. (As an aside, I have decided to subscribe to Fareed Zakaria's Video Podcast for his take on current events.

As far as scope is concerned, I was pleased to see how well The Post American World dealt with international relations, but I was disappointed that Zakaria didn't focus enough on domestic issues in the United States. Nowhere was there any mention about ongoing social issues or monetary policy. I am encouraged to hear that Zakaria wishes to expand our toolbox for dealing with problems, ranging from increasing international legitimacy to partnering with private enterprise. I do think it would be helpful if he tried exploring how to get all of our "ducks in a row" domestically before advocating that we try to export our processes and methods. After all, a business solution to the problems he's presented makes no sense if "no one [has] much of an incentive to build wealth, since it was likely to be confiscated" – most likely with differed taxation.