chapter Six

虚实篇
Weaknesses & Strength

Presentation Title UBMM 1011

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ZI’S ART OF WAR AND BUSINESS STRATEGIES
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Strength indicates your ability, capability, skills, resources or
preparation in the battle
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Weakness is a tactic that you can’t predict but it may cause you to
lose in the battle in one time

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 孙子曰：凡先处战地而待敌者佚，后处战地而趋战者劳。
Those who arrive first at the battleground will have sufficient time to rest and
prepare against the enemy and those who arrive late at the battleground will
have to rush into battle when they are already exhausted

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Arrive First Theory

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 If you can’t be first in a
category, you need to set up
Another New Category that
you can be First In

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 Most Powerful Concept
in marketing is owning a word in the prospect’s mind

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In business, being the first company to sell a new product may
provide long-lasting benefits or competitive advantages
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 For over a hundred years,
Pepsi has been trying to play catch-up in the cola beverage market,
but first mover Coca-Cola continues to dominate the market
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First, a company must have an opportunity to be first at something,
either through skill or luck

Second, the firm must be able to capture the benefits of being first

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When the first mover can establish their product as the industry standard,
making it more difficult for followers to gain customer acceptance

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 CASE STUDY – WALMART
The year 1962 was called the year of discounting.
Hundreds of discounting stores had popped up all
across the USA. In the same year, three big
companies started their discount chains in the big
city

Woolworths K-Mart Target

All three were giants and people were optimistic

about their growth.

And then one guy started a small ‘discounting store’

then, called ‘Walmart’ in a small town called Rogers,
Arkansas.

Nobody gave him any importance. He received no

First to locate discount stores in small media coverage.
towns
He was just one among those hundred small
discounting store owners waiting to be eaten up by
the three giants.
 CASE STUDY – WALMART

Within 5 years, Kmart had 250 stores with

sales of $800 million to Walmart’s 19 stores
with sales of $9 million.

By 1970, Target reached $200 million in

revenue with 24 stores — well ahead of
Walmart.

But…. five decades later, Kmart has 365

stores with sales of $25 billion to Walmart’s
11,718 stores with sales of $500 billion.

Target’s revenue in 2017 was $72 billion

CASE STUDY – WALMART

FINDING A NICHE MARKET

One of the formulas for positioning

your brand in the consumer’s mind is
to start in a small market. Focus on a
particular need, work on it, make your
product distinctive and dominate the
niche market.

Smaller the segment, the easier it is for

the entire company to focus and meet
customer needs, wants and desires.
Once you become a leader in the
niche market, you can move to the
larger markets.
 CASE STUDY – WALMART

ALWAYS LOWEST PRICE

At that time retailers were selling products

with higher margin — A retailer would sell a
product costing 80 cents for $1.20.

Sam, during one of his research works, found

that by pricing the product at $1.00, a retailer
could sell 3 times the volume and achieve
greater profits.

This tip changed Sam Walton’s idea about

retail and also his life. His motto became “We
Sell For Less — 20% less than the competition.’’
Discount everything that Walmart carries.
CASE STUDY – WALMART
Walmart began to view suppliers as ‘Business
Partners’. The vendor partnership program
was extended to other suppliers.

Walmart executives sat down with the

vendors, worked out the production and
various other costs, margins and planned
everything together.

Their ultimate aim was to reduce the cost of

the product to the end consumer.
Transparency improved and mutual trust was
earned by both parties. Both won and so did
the customers.

First mover may increase production

capacity, or broaden their product line,
signaling that there is not enough room for
followers to enter and profit
First mover has the opportunity to shape consumer preferences and first
company to offer a product of acceptable quality may earn brand loyalty

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Satisfied consumers tend to not spend time seeking information about other
products, and tend to avoid the risk of being dissatisfied if they switch

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 For example, the first entrant may invest heavily in attracting customers,
to try a new type of product. Later entrants would benefit from informed
buyers, without having to spend as much on education
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 故善战者，致人而不致于人
The person adept in warfare seeks to control and manipulate his
enemy instead of being controlled and manipulated

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If you can control your enemy’s grain & foods, control their raw
material or resources, or cut off their supply

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If all those are controlled and manipulated by your competitor,
How Are You Going to Survive?

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Apple is one of Samsung's biggest customers for
processors and memory chip previously

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Samsung is the world's biggest maker of some of the most
sophisticated parts that Apple craves

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 But the two firms compete directly in the mobile-phone market, and
have spent the better part of the past few years suing and countersuing
over the look, feel and features of their gadgets

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 Dependence on Samsung limits Apple's ability,
to control its destiny by constricting Apple's negotiating power,
and ability to use different technologies
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In August 2012, Samsung was court-ordered to pay $1.05 billion in damages
to the global IT giant for illegally copying some elements of the
iPhone and iPad in its Galaxy S-series smartphones

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Control Resource
Samsung is in a monopoly on small and medium size
OLED panels and memory worldwide

The OLED panel is already the standard of future high-

end smart phones.

Apple is very dependable on

Samsung OLED supply for their
display panel and memory
 能使敌人自至者，利之也；能使敌人不得至者，害之也。
He could cause his enemy to arrive on his own accord by luring him with
advantages. He could also deter his enemy from coming by creating
(potential) dangers and harm

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 Corporate
Suppliers

Bankers Competitors

Customers

if you can’t attract your enemies to come and cooperate or fight with you,
means that you are no value to them or in simple words,
you are nothing to them

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 Volvo, Renault and Peugeot formed an alliance to make engines for
their large car models because none of them have enough engines to
operate their own engine plant economically

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 Repsol + Burger King
Collaborating to increase revenue at gas stations
The objective is to reach 150 stations in a period of 5 years, with investment of
some €50 million. Repsol is planning on hiring approximately 1,500 new employees

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 This collaboration with BMW epitomizes our shared values and creativity,
technological innovation and style. This is a pure expression of the art of travel

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 One Belt, One Road (OBOR)

Business Cooperation, Build Jointly & Sharing Concepts

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In today’s business world, fighting alone is the past tense, you need
a team or support to help you to become successful

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 出其所不趋，趋其所不意
Attack places where the enemy must rush to rescue
Move quickly along routes where the enemy least expects

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 行千里而不劳者，行于无人之地也
An army can travel for a thousand miles without being distressed and
exhausted because it moves along places where there is no enemy

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 Don’t Use the Strategies that People
have Already been Accustomed to or Predicted

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To play in uncontested market places, instead of engaging with
competition in existing marketing spaces

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Netflix created uncontested marketing space by selling TV shows
over the internet which no one else was currently doing

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 By doing this they were able to break the value-cost trade off by
providing better value than cable TV at a lower cost than cable TV

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 There is ample opportunity for growth that is both profitable and rapid
In Blue Oceans,
competition is irrelevant because the rules of the game are waiting to be set

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 Based on the view that market boundaries and industry structure are not
given and can be reconstructed by the actions and beliefs of industry players

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A major U.S. airline which was established in 1967
The Largest Low Cost Carrier in the World

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It offers flexibility of bus travel at the speed of air travel
using the Secondary Airports

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Pets Garden

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1. Ideal location in the heart of KL city, MRT nearby
2. Perfect Combination of columbarium and memorial hall
3. Five to Six star magnificent columbarium
4. Fully air-conditioned
5. Five-star facilities - high class restaurant, florist, convenience store, resting areas etc
6. Over RM60 millions of perpetual maintenance Trust Fund
7. Excellent investment value
8. Zero interest installment

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 我专为一，敌分为十，是以十攻其一也，
If I can concentrate and unite my entire troop at one place while
those of the enemy are scattered at ten different places, then I can
use my entire force against one-tenth of his

能以众击寡者，则吾之所与战者，约矣
If I can use a larger and stronger force to attack a smaller and inferior
one, those enemies who engage in battles against me will surely be
defeated easily

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One - Tenth

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If you really can control and manage the core business well
then just move to the others
BUT, do not neglect your core business
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Nike is considered the premier athlete supplier for serious athletes

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 Their business model is simple:
Offer High Quality Sports Materials

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By focusing on their product line, they are able to produce high
quality products that meet customer expectations

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Give the athlete the equipment they need to succeed

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Nike has established itself not only as a leading brand for athletes,
but also as a leading fashion brand

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To remain a leader in the industry, Nike must constantly be innovating with
new and improved tools to help the athlete perform at their peak

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胜可为也。敌虽众，可使无斗
Victories can be created by us

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 故兵无常势，水无常形
In the conduct of war, there is no fixed situation and condition, just like water
has no constant shape and configuration

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 能因敌变化而取胜者，谓之神
The person who gains victories by adapting to the changing conditions and
situations of the enemy can be considered a legend in warfare

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 故五行无常胜
There is no guaranteed victory among the five elements of nature
(metal, wood, water, fire, earth)

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 四时无常位，日有短长
There is no permanency for each of the four seasons. There are days
which are short and days which are long

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 月有死生
There are changes in the shape of the moon throughout a month

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 In the business, if you can change according to the changing conditions and
follow the demand of the market, then you easily create successful business

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Google was an unprofitable company, fumbling left and right for a
stable revenue source

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 In 2003, the company launched its AdWords program which allowed
businesses to advertise to people searching for things on [Link].

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In 2008, Google reported to the SEC that, it had generated $21 billion
in advertising-driven revenue alone

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 In 2022,
Google’s brand valued at
819.57 billion U.S. dollars

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Facebook operated more like a “secret society”, going so far as to
require .edu e-mail addresses in order to join

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Facebook founder Mark Zuckerberg decided to open Facebook
to high school students in 2005

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By 2006, the service had opened to anyone 13 years old or older
with a valid e-mail address

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Until 2022, Facebook had achieved over 2.93 billion monthly active
users around the world

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 On 2015, Facebook became the fastest company which in the
Standard & Poor’s 500 index to reach a market cap of $250 billion

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The changes that were made unlocked new dimensions of
revenue and profitability

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 Making such changes requires both the foresight to know that,
existing strategies are ill-suited for future opportunities,
and the discipline to enact fundamental shifts in corporate focus

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Change might Not Guarantee You Success, but, if you do not dare to
change, it means that you will Remain as What You Get Now!

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