Business strategy: Optimizing mind warfare

Roy Goni, Lecturer at School of Economy, Unika Atma Jaya University

Nobody likes uncertainty. That's why so many of us frequently consult with and rely on psychics as well as expert consultants to predict the future.

Sometimes their predictions help, albeit partially, but most of the time we are still left alone and helpless in the dark. Uncertainty is a reality of life and something we have to face on a daily basis. Similarly, the business world is filled entirely with uncertainties. Worse yet, mounting pressure and cutthroat competition is also unavoidable.

In today's "borderless" world, like it or not, fierce competition is an integral part of any kind of business. In almost all categories, local companies have to rack their brains in the rivalry against global players.

Take, for instance, the retail business. Here we find Hero, Matahari and Pasaraya are pitted against Carrefour, Makro, Sogo and Metro. In the courier service, PT Posindo has to face Fedex, TNT, UPS and DHL. In the beverage industry, it is Teh Botol and ABC against Coca-Cola and Pepsi, while local coffee brands such as Kapal Api, Ayam Merak and Torabika are up against their world brand rivals: Nescafe, Starbucks, Coffee Bean and Dome.

To survive, local companies have no choice but to find some innovative breakthroughs, as they seem to be rather unprepared to enter the global market. Hence, they have to opt for a defensive stance in their country against the invading multinational corporations. Being on the defensive for a while is not that bad, though such an attitude would render them losers in the long run.

It would be ironic if one day local companies had to pack up and leave since Indonesia is considered one of the major and lucrative target markets for multinational giants, who call it nothing more than a "consumption country".

Based on an analysis made by Prahalad & Hart in their book, The Fortune at the Bottom of the Pyramid, Indonesia is included in the fourth bottom layer in reference to its population size and income per capita of below US$1,500. It is not surprising, therefore, that Indonesia has long been flooded with hundreds of world brands and the past few years have seen the successful entry of various Chinese products into the market.

Local companies should probably take a lesson or two from the world famous chess master, Bruce Pandolfini. A familiar name to chess lovers, his books have enlightened many on how to become a better player.

Some of his thinking is analogous and quite relevant to the mindset recommended for business people.

"When you have several workable options, go for the best," he said. This is the first recommendation. Don't think too far ahead, because you would only be wasting your energy and time. In today's world, which is bursting at the seams with abundant information, it would only be unrealistic. So the real issue is how you think for right now, and most importantly being fully aware of the current situation to help you plan better. Just remember that good thinking is a matter of making comparisons.

The second recommendation is: "To win big, think differently". To win in a competition, it is often necessary to avoid playing by the rules.

One indicator is the marketing history of Japanese products, which were looked down upon and regarded as copycat products during their early days of entry into the U.S. market. But as years passed by, reality proved otherwise. Japanese brands, which were later followed by Korean products, like Toyota, Acer, Samsung, etc., were eventually well received and have become respected names. The obvious lesson here is never become a follower.

The third piece of advice: "Small advantages produce big results". A game of chess, says Pandolfini, is a game of small advantages. Relevantly, business executives should be reminded of the Kaizen principles applied by their Japanese counterparts. In today's tight business game, never think of making a rapid leapfrog. Start looking at the smaller details to uncover aspects that have been disregarded by your competitors. As the famous Japanese saying goes: "Pay attention to detail, observe carefully what the competitors are doing, choose the right segment, watch out for the competitors' maneuvers in reaction to your initial small steps."

The fourth piece of advice is "Mind games are a part of the game". Business decisions certainly involve mind games, not just gut feelings or pure intuition. For local companies, in order not to lose out to highly experienced multinational corporations, it is vital that they develop themselves into better players in the war of the minds by meticulously scrutinizing each and every step taken by the competitor, while simultaneously learning from past mistakes.

The fifth tip is: "Never let 'em see you sweat". That may sound simple but it is extremely important. Whether you are reaping in huge profits or suffering great losses, keep completely quiet about it. By appearing cool, calm and collected, at least you reduce the possibility of any competitors finding out the miserable state you are in. You will find this sort of mindset very useful in preparing your future moves and improving your next position.

Last: "Learn how to win, learn how to lose". In business, just like in life, which is full of uncertainty, there is always some kind of trade-off. Luck comes and goes. Losses occur in every type of business and everyone should always be prepared to turn them into lessons of experience.

So once again, just as uncertainty is real in every aspect of life, the key to coming out the winner is to enhance your endurance and maturity in mind warfare.