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Economy of Force as a Strategic Weapon

Three Critical Competitive Competencies

Sep 8, 2009 Paul Larson

Organizational strategy is the science and art of employing all available resources to accomplish the goals of the enterprise.

The principle of economy of force is an essential part of that strategic vision and this military concept translates very well into the business world. For over several thousand years, military strategists have analyzed warfare and developed some fundamental principles which, when properly applied, lead to success. Using the principles of economy of force, a business can effectively determine where, when, and how to deploy its resources.

Economy of Force as a Strategic Weapon

In the military, economy of force means to allocate minimum essential combat power to secondary efforts. If the translation to a business context is not done well, there can be some danger here for a business though. Sometimes a business can get so focused that it gets tunnel vision.

Economy of force, if applied properly though, can ensure that the secondary projects, programs, systems, customers, etc. get sufficient resources to guarantee success. The need here is to build into the plan the necessary evaluation process to ensure that the 360-degree risks are addressed. Three simple questions can help in this process. They are:

Which customers should be targeted and which not?
What should the targeted customers be offered and what not?
How can this be accomplished most efficiently?

In war there are never enough soldiers, supplies, munitions, or just plain will. If those things were abundant then war would not be an art and generals not so necessary. It would be a science rooted in math and logic and much less skill and understanding would be necessary to manage it.

Three Critical Competitive Competencies

No army has enough forces to accomplish everything. Neither Alexander the Great, Hannibal, nor Genghis Khan had enough men, weapons, ammunition, food, and reserve forces to achieve all of their objectives. The same holds true for business leaders where even those highly regarded as being uncommonly successful never had enough resources to accomplish all of their goals.

Just like in war, technical developments can create huge advantage. The purpose of the technology is to create even more economy. Information technology has moved to the forefront today because information equals economy. When markets are understood completely resources can be concentrated with much less waste.
Developing people is another key to achieving economy. When they are educated, experienced, skilled, they can act without supervision in adapting to competitor innovation and delivering the goods to the customer.
Flexibility and adaptability of strategy is another. If a firm has only one predominant way of competing in the market then competitors can gear up their defenses against that strategy. If instead there are multiple options supported by the agility to move to and from them then the competitive picture is much more difficult for a competitor to combat.

Economy of force compels leaders to choose how they will dole out the forces available to them. These forces or resources are time, employees, and money. For some operations it is necessary to deploy many resources, which means few resources will be available elsewhere.

For example, if a company wanted to expand into two new market niches this year, it might first want to spend six months intensely developing the first niche concentrating its time, money and staff there. Then it could determine if the niche is far enough along to manage itself. Perhaps it might be necessary to move staff to this area or hire someone to manage this new niche. At that point it could decide to continue with the second niche in the same fashion.

The copyright of the article Economy of Force as a Strategic Weapon in Business Management is owned by Paul Larson. Permission to republish Economy of Force as a Strategic Weapon in print or online must be granted by the author in writing.

In the Military, Economy of Force Allocates Power