36 STRATAGEM [Document subtitle]

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What is Reverse
Psychology

And reverse psychology is that by pushing for the opposite of what you want,
the other person will choose to engage in the behaviour that you actually desire

While it can be seen as a way of managing another person's behaviour, reverse

psychology can also be used as a form of manipulation.2 The person who is the
subject of this tactic generally doesn't realize what is happening and may not be
fully aware of the other person's true motives.

Examples of Reverse Psychology

 Marketing and sales strategies often utilize reverse psychology to encourage

people to buy goods and services.3 For example, a salesperson might make a very
high sales pitch and pressure the customer to buy something. However, what the
salesperson is really trying to do is to get the customer to respond by offering to
take a much less costly deal.
 Parents often use reverse psychology to get their kids to do what they want them to
do. For example, a parent might tell their child not to pick up their toys in their room
in the hope that the child will actually do the opposite.
 In love relationships, people also use reverse psychology to get their partner to behave in
particular ways. For example, one partner might suggest that they wish their partner would
clean up the garage but that they know they probably won't have time to do it. The partner
might then react by cleaning the garage to prove their partner wrong

Outwit your Competition with these 36

Business Stratagems
Winning Strategies
Winning Strategies
1: Fool the Sky to Cross the Sea
Mask your real goals, under the ruse of a fake goal, until the real goal is
achieved. Use a deceptive strategy that will mask your real goals, and
eventually mislead your competition. The key is to appear “non threatening”
until it’s too late for your enemy to respond
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2 : Besiege Wei to rescue Zhao

Distract then destroy. Sometimes, competitors are so strong, they seem
impossible to defeat. However, there’s always a gap in the armour, or a
weakness that can be attacked instead. Indirectly attack something that he holds
dear, or go where the competition is not present

3 : Kill with a borrowed knife

Use someone else’s resources or strengths to defeat your competitor. You can
trick an ally into attacking your enemy, collaborate with a third party, or use the
enemy’s own strength against him. The idea here is to cause damage to the
enemy by getting a third party to do the deed

4 : Relax while the enemy exhausts himself

Never let your competitor dictate where the battlefield is. Let your enemy come
to you, by choosing the time and place of battle yourself. Encourage your
enemy to expend his energy in futile quests, while you conserve your strength.
The idea is to have your troops well-prepared for battle; when the enemy is
exhausted and confused, you attack with energy and purpose

5: Loot a burning house

When the enemy is weakened (by internal conflict or troubles), attack it without
mercy and totally destroy it to prevent future troubles. Be on the look out for
companies who are in trouble, then turn their misfortune to your advantage. You
can also sow dissent in their ranks, feed them false information or use other
means to distract them, before attacking. Corporate takeovers and acquisitions
use this strategy, buying corporations when they are weak. In effect the
acquiring company gets a good buy. Most loan sharks, pawn shops are aware of
this principles. Buying repossessed properties is another good example

6: Clamor in the east, then attack in the west

In any battle, the element of surprise can provide a huge advantage. The idea is
to create a diversion, get the enemy to focus his forces in a location, and then
attack elsewhere where his defenses are weak. For example, you can make them
believe that you are penetrating a market which is of little interest to you. When
they focus on that market, launch a new product in your true target market
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Confrontation Strategies
7: Create something from nothing

In short, lie, or create an illusion of something’s existence. For example, fake

attacks twice or thrice, and when your competition no longer perceives this as a
threat, execute your “real” attack, follow through and conquer.

In 756, a General named Ling Hu Chao of Qin was attacking the Yonqui, and
the latter was running out of arrows. General Chang Sun, who was defending
the fortress, ordered straw mannequins to be lowered. General Chao’s troops
fired thousands of arrows to these mannequins, and the arrows were duly
collected by Chang Sun’s troops. When this was repeated a second time, the
enemy ignored the mannequins. The third time, real warriors were lowered, and
launched a successful attack against the enemies

8 : Pretend to take one path, while sneaking down anothe

Deceive the enemy with an obvious, “standard” approach that takes a long time,
then surprise him by taking a shortcut and sneaking up to him. This is an
extension of Strategy 6 above; but using convincing, physical baits as a decoy to
draw the enemy’s attention. Many martial arts fighters do this by faking a strike
at the body, but hitting the head of the opponent at the last minute

9: Watch the fires burning across rivers

When your opponents are fighting in the same battle field, monitor the situation
but delay joining the fight. If you are the “small player”, never join the fight of
“market leaders”. Wait until your competitors have exhausted themselves, then
move in and pick up the pieces
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10 : Hide a knife behind a smile

Never appear competitive, but project an image of neutrality or even

friendliness. Charm your competitors to gain their trust, and strike when a
favorable opportunity presents itself. Before the Soviets took over Afghanistan
in 1979, they give Afghanistan military aid and even sent military advisors to
train their army. The Soviets learned about and gained control of the Afghan
military, and eventually invaded Afghanistan

11: Sacrifice the plum tree to gain the peach tree

12: Take the opportunity to pilfer a goat

Be ready to exploit an opportunity when it presents itself. As you focus on the
tasks and goals at hand, maintain a peripheral vision to look out for
opportunities and threats along the way. Oftentimes, the window of opportunity
is small and specific. Take advantage of any opportunity that presents itself,
however small, and avail yourself of any profit, however slight. Likewise, look
for your competitor’s mistakes and make them work for you. Look for niche
markets that your competitor may have overlooked or neglected

Direct Attack Strategies

13 : Beat the grass to startle the snake
Frighten and startle the enemy to see how they will react. Do something unusual
or unexpected (“beating the grass”) to provoke a response from the enemy
(“startle the snake”), so he gives away his plans or position, or is disoriented.
For example, you can announce that you are launching a new product or
marketing strategy and observe how your competitor reacts.

14: Borrow a corpse to resurrect the soul

Revive something from the past, and re-invigorate or re-use it for another
purpose. This can be an old idea, an old technology or a method that has been
forgotten. Adapt them, you can even infuse it with modern technology and
make it useful for your own purpose. Ideas or inventions which may have been
too expensive or too risky before, may become viable today with the application
of new technology or changes on market economics
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15: Lure the tiger out of the mountains

Lure your competition away from his position of strength. Never attack when the
enemy is uphill and where his position is strong. Entice him to come down to your
home territory, to your place of strength. It is always wise to bring your
competition out of a situation that favors him, to a position that favors you. In
politics, this is often used by inviting diplomats to negotiate in the host country, to
get that homeground advantage. Try to get your competition to abandon a market
where he has a stronghold, then seize that abandoned market when your
competitors loses the stronghold.

16 : To catch something, first learn to let it go

A cornered enemy will often mount a final desperate attack. Instead, give your
enemy an option to escape, so he’s focused on escaping rather than fighting you.
When his escape plans are foiled, his morale will be further weakened, and it will
be easier to defeat him

17: Toss out a brick to attract a jade gem

Use a small bait to catch a big fish. Bait someone by making him believe he can
gain something (“toss out a brick”) and obtain something valuable from him in
return (“get a jade gem”). Attract a competitor to move to a position which is
advantageous to you, or capture a market by giving away something inexpensive
for free.

Many Fastfood companies do this by bundling their products into value meals,
where customers are made to think they can save more from the value offers, but in
reality they end up buying more. McDonalds’ Happy Meals feature toys of famous
movies which appeal to children. Kids want the meal because of the toy, and
parents end up buying the toy, the kids’, as well as thier own meals

18: Defeat the enemy by capturing their chief

Defeat your enemies by capturing their leaders or thinkers. When an army is strong
because of a strong general, they will be significantly weakened (or may naturally
disperse) once the general is removed. In business, this can be applied by poaching
key leaders of your competitors (who may even bring over his key people). This is
a better approach than a direct confrontation with your competitors
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Chaos Strategies
19: Remove the firewood under the cooking pot
Eliminate the source of your enemy’s strength. Whenever you are faced with an
enemy who has enormous strength and power, direct engagement becomes
impossible. In this situation, find out first the source of his power, then eliminate or
undermine them there – Literally take the fuel out of their fire.

20: Fish in troubled waters

Create confusion and use this confusion to further your own goals. Do something
unusual, strange or unexpected can distract or disorientate your enemy focus, then
attack while he’s confused and vulnerable.

21: Slough off the cicada’s golden shell

When you think you are at the brink of defeat, and escaping is the only option,
create an illusion. Mask yourself – become inconspicuous, or masquerade as
something/ someone else. During the Chinese conquest, many generals escaped
death or capture by creating false impersonations.

In business, when you think that your business needs to expand or needs to change
direction, you can do this by keeping your old company but secretly transferring
your assets to expand or form another company. This way, you can quietly amass
your resources or rebuild your strength under the radar.

22: Shut the door to catch the thief

Once you have captured your enemy, never allow a chance for them to escape;
bring the battle to conclusion and leave no room for your enemy to strike back.
Before you move in for the “final kill”, first cut off your enemy’s escape routes,
and cut off any routes through which outside help can reach them. For example, a
price war may be damaging in the long run, but can be used to bankrupt a
competitor that’s running low on resourcesm

23 : Befriend a distant state while attacking a neighbour

It’s easier to invade territories that are close to your yours. If you have two battles
to fight, make sure you fight the one nearest and if possible befriend the one
farthest. Build and use strategic alliances to gain the upper hand. This is very much
applicable today. You can observe that countries tend to fight with their nearby
neighbors, and countries farther turn out to be great alliances.
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24: Obtain safe passage to conquer the Kingdom of Guo

Borrow the resources of an ally to attack a common enemy. During the Vietnam
War, the Americans used their bases in the Philippines, while the Vietnamese
moved to Cambodia to avoid air strikes. In modern times, we establish good
relationship with people from whom we need help. Business use alliances,
middlemen and networking to access better deals at a lower cost cost.

Advancement Strategies
25: Replace the beams and pillars with rotten timbers
By removing the enemy’s key support, you weaken them and disrupt their battle
plans. This could involve disrupting the enemy’s formations, interfering with their
methods of operations, changing the rules in which they are used to following
etc. To replace the pillars you’ll need manipulation, long term planning or even
“intelligence” to penetrate the enemy ranks. Some business have been known to
“plant” employees in a competitor company so they gain access to crucial
information. Others just woo their competitor’s key people by offering an enticing
salary and perks.

26: Point at the mulberry tree while cursing the locust tree
Point at one to scold the other. Sometimes, it’s hard or undesirable to directly
discipline, control, or warn someone due to their position or status. Use analogy
and innuendo instead.
From the business point of view, sometimes it easier to attack the competitor not
by competing head on but by attacking their very powerful leader and destroying
his personal worth and credibility. Exposing a scandal, or even spreading rumors
against their CEO will hurt the company’s image and reputation.

27: Feign madness but keep your sanity

When you are strong, pretend to be weak so your foes will not take you seriously.
Hide behind the mask of a fool, a drunk, or a madman to create confusion about
your intentions and motivations. Make your enemies underestimate you, so they
become lax and unassuming. Once they drop their guard, you may attack.
Many car companies practice this strategy. When a competitor unveils a new car
model, the other competing company watches from a distance. The next thing we
know, this once “weak” company launches a better model the following year.
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28: Remove the ladder when the enemy has ascended to the roof
Burn bridges after crossing them. Lure your enemies to follow you towards a
rugged terrain, then trap him by cutting off the escape routes. However this
strategy must be used with caution as it can easily backfire. When retreat is
difficult, your enemy’s soldiers may fight to the death, making it difficult for you
to retaliate. Make sure you have the winning advantage like ample supply of
weapons and a stronger contingent. In business, there’s the concept of management
by crisis, or using a “burning platform” to force actions that would not otherwise
be taken under normal circumstances

29: Deck the tree with bogus bossoms

By tying silk blossoms to a dead tree, you create the illusion that the tree is
healthy. Using artifice and disguise, you can pretend to be more than you really
are, and make your enemies assume you are big and powerful.
Companies that appear larger than they are elicits trust, and many marketers
practice this strategy by making their products appear more than what they really
are, to create an impression of a well established company.

30: Make the host and the guest exchange roles

If you cannot defeat them, join them. Befriend your enemies by working with them
and learning from them. Initially, pretend to be a guest to infiltrate your target and
be accepted. Study their vulnerabilities from the inside and develop dependency.
When you have gained enough strength and control, attack.

Defeat Strategies
31: Use a woman to ensnare a man
The “Beauty Trap” is about using a woman to distract the enemy or get valuable
information. This can work on three levels. First, the leader becomes so distracted
by the beauty that he neglects his duties and lets down his guard. Second, jealousy
and conflict can be sowed if the desired women starts courting another men. Third,
conflict and strive can spread if other females are become jealous or envious.

32: Fling Open the Gates to the Empty City

The “Empty Fort Strategy” is about not showing your fear or concern. Even if you
are truly vulnerable, make the enemy think twice about attacking you. Appear
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willing and ready to fight, in such a way that makes the enemy suspect it’s a trap or
ambush. Act calm when your enemy expects you to be tense.

33: Let the Enemy’s own spies sow discord in the enemy camp
Use their spies against them. Rather than capture the spies, use the spies to spread
misinformation and sow discord. Undermine your enemy’s position by secretly
causing discord between him and his friends, allies, advisors, and troops. While he
is preoccupied settling internal disputes, his ability to attack or defend is
compromised.

34: Pretend to injure yourself to win the enemy’s trust

Inflicting self-harm is a common way to gain attention and sympathy. First, your
enemy may let down its guard, thinking you are no longer an immediate threat.
Second, your enemy may actually rush to your aid if they believe the injury was
caused by a mutual enemy. In the modern day, companies use this strategy by
admitting to a mistake to soften public opinion, or filing bankruptcy to avoid
mounting debts and taxes (while collaborating with stronger companies to revive
the company).

35: Chain together the enemy’s war ships

This is the tactic of combining tactics – have several stratagems operating in
tandem, so you can confuse the enemy by combining stratagems, or keep them on
their toes by rolling out one after another. However, be careful to ensure that if one
strategy fails, it will not cause a chain-reaction to break the whole scheme.

36: If all else fails, retreat

Don’t fight a losing battle. If it becomes clear that your current course of action
will end in defeat, choose to retreat and regroup. Escaping may mean a loss of
dignity, but unlike surrender or compromise, you’ll still have the chance to strike
back when the odds are once again in your favour. In business, it’s sometimes
wiser to cut losses and make a comeback later.

36 Ways to Win: Learning Deceit, ominance

and Psychological Warfare from Ancient
China
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Revealing what Sun Tzu was too delicate to say

we would like to review one of the most interesting works of ancient Chinese
literary tradition, the so-called Thirty-Six Stratagems. Why delve into it here?
Simply put, to gain a complete picture of what Ancient China can teach us
about how to succeed in any competition or conflict. The literaly work has a
puzzling background that still provokes debate, yet nevertheless it presents us
with something precious: a detailed panorama of Chinese views on strategic and
tactical thinking

According to Sun Tzu, the undisputed author of the The Art of War, supreme
excellence in conflict consists in defeating the enemy without a fight. If a
violent altercation must be had, one should seek to “win” first and then go
into battle

War is a game of deception. Therefore, feign incapability when in fact capable;

feign inactivity when ready to strike; appear to be far away when actually
nearby, and vice versa. When the enemy is greedy for gains, hand out a bait to
lure him; when he is in disorder, attack and overcome him; when he boasts
substantial strength, be doubly prepared against him; and when he is
formidable, evade him. If he is given to anger, provoke him. If he is timid and
careful, encourage his arrogance. If his forces are rested, wear them down. If
he is united, divide him. Attack where he is least prepared. Take action when he
least expects you. Herein lies a strategist’s subtlety of command, which is
impossible to codify in hard-and-fast rules beforehand

The above quote from The Art of War (translated by Lin

Wusun, Long River Press, 2003) is known in Chinese
tradition as the 12 laws of ‘ 诡道 ’/guǐ dào’ or ‘the way (art)
of deception’

The origin of the 36 Stratagems is not known for certain.

Semantic analysis demonstrates inconsistency between parts
even in a single phrase, implying that they were compiled by
multiple authors or editors. Some researchers even connect
the treatise to the secret anti-Qing society called Hongmen –
the Qing being the last dynasty of Imperial China of
Manchurian origin, beginning over a thousand years after the
time of the Qi. This might then explain why no early copies
have been identified in private or public collections.
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1st Stratagem of 36: Deceive the

Heavens to Cross the Ocean /
Hide In Plain Sight
Mask one's real goals from those in authority who lack vision
by not alerting them to one's movements or any part of one's
plan.

The best victory is achieved by breaking the enemy without a

fight. Therefore, ‘commanding superiority’ by no means implies the
use of crude physical force. Rather it is a case of applying ‘open’
deceit without fear of being exposed. Think of a murderous game of
cat and mouse that is nearing its closure. The last move made by
the cat is still decisive. If the deceit becomes apparent, this may
hinder success; nevertheless, one feels confident in success. It might
seem as if we are beginning at the end, but this is not so – In a
sense the author of the Stratagems may be said to have placed one
of the easiest manoeuvres at the start, since victory is already at
hand in the given scenario.

Openly act as if you intend to do one thing to create a false

sense of control in your adversary. Secretly do the opposite so
that when your opponent realizes what is happening it will be too
late for him to retaliate

As an alternative, openly do one thing multiple times, creating

a constant state of false alarm until your adversary no longer
takes notice. After your opponent starts to ignore you then
attack at will.

Historical note
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The actual proverb 瞒天过海 / mán tiān guò hǎi/ has been known
since the late Ming dynasty (1368-1644). Most likely it refers to
the story of the general, Xue Rengui, who tricked the Tang Emperor
LI Shimin, who had a fear of open water, into crossing the sea to
fight the Korean kingdom Goguryeo. Rengui lured the emperor into
a palace where the master feasted for several days. The ‘palace’
turned out to be a ship in disguise that brought the emperor to the
other side of the sea without him even realizing it.

The stratagem exploits the gap between what we see and how
we evaluate a risk. People habitually believe the level of threat
coming from a situation will remain the same once it has been
established what is going on. It seems unnecessary to maintain the
same level of alertness. Failure to discern what is a threat and what is not is what makes
one easy prey for a deceiver

Application

In history, we find interesting cases of deceit like this one. Far away
from China, in the pre-Ukrainian state known as Kievan Rus,
Princess Olga (920-969 C.E.) lost her husband Oleg during his
campaign against the Slavic tribe of Drevlan. Princess Olga later
besieged the capital of Drevlan. The city begged to surrender,
offering a rich ransom to make up for its transgressions. Olga had a
simple request: three sparrows and three pigeons from every
household of the city. Drevlyans were perplexed but relieved. Olga’s
request was satisfied. The next day, princess OIga ordered her
detachment to bind a piece of smouldering touchwood covered in
cloth to every dove and every sparrow and set them free. Birds flew
back to their nests and doves to their cotes, sparrows to their eaves.
The city was set on fire all at once and swiftly fell to Olga, who
showed no mercy towards the killers of her husband

Mal, ignorant of Olga’s fury — and the fact that she’d already killed
twenty of his men — sent a group of decorated chieftains.
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When the Drevlian chieftains arrived, Olga offered them her

bathhouse to freshen up after their journey. But when they entered,
Olga bolted the doors and burned the entire building to the ground.
No one escaped alive.

And Olga still demanded vengeance, but she had to act fast.

Before Mal and the Drevlians realized the bloody fate of their
dignitaries and chieftains. So Olga of Kiev traveled north to the
Drevlian capital, outrunning the news of her brutal vengeance
killings.

When she arrived, Olga hosted a funeral banquet for her husband and
invited the Drevlian soldiers to show good faith. But as soon as the
Drevlians got drunk, Olga’s loyal soldiers pulled out their swords and
slaughtered 5,000 men.
Olga Of Kiev Decimated The Drevlians In Their Capital

At that point, the Drevlians feared Olga of Kiev would not stop until
she wiped out their entire tribe. So the survivors pleaded with Olga to
accept their tributes and return to Kyiv.

Olga considered their offer, then declined. Instead, she laid siege to
their capital for over a year until they begged for mercy. And when
they could take no more, Olga gave them an offer of peace.

“Give me three pigeons and three sparrows from each house,” Olga
said, according to the Old East Slavic chronicle of the Kievan Rus
known as the Tale of Bygone Years. “I do not desire to impose a
heavy tribute, like my husband, but I require only this small gift from
you.”
Now Olga gave to each soldier in her army a pigeon or a sparrow, and
ordered them to attach by threat to each pigeon and sparrow a piece of
sulfur bound with small pieces of cloth,”
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That night, Olga told her soldiers to release the birds. When the flocks
landed back in their thatched nests in the Drevlians’ houses, they lit
them on fire.

“There was not a house that was not consumed, and it was impossible
to extinguish the flames, because all the houses caught on fire at
once,” according to the Kievan Rus chronicle.

“The people fled from the city, and Olga ordered her soldiers to catch
them. Thus she took the city and burned it, and captured the elders of
the city.”

Olga divided up the captives. Some, she slaughtered. Others, she sold
into slavery. And the lucky few were allowed to rebuild the town.

In business, an infamous example of using the Hide In Plain

Sight strategy is the story of a Japanese manufacturer of food flavour
intensifier who dramatically increased sales by changing the diameter
of the outlet in their product’s bottle – the product appeared to be the
same, but the experience of consumers was changed. Then there is
the ‘Planned Obsolescence’ phenomenon in appliances and hi-
tech devices. Makers of mobile handsets purposely block users
from updating the OS on their old phones. This prompts users to
change their devices. Furthermore, enticing customers with insanely
cheap prices up front while soft-pedaling surcharges is another
widespread deception used in business.

My personal experiences of being subject to a Hide in Plain

Sight strategy are numerous. Many years ago, when I was the head
of a procurement office in China, I was frequently lured into a trap
based on a ‘cheap’ price. Chinese have a saying 一 分 钱 ， 一 分
货 which means ‘You get what you pay for’ or ‘Every extra penny
deserves its value’. Chinese manufacturers readily cut the price to
strike a deal. The deceit is in the changing of unspecified
characteristics of a product. For every discounted cent, an artful
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manufacturer downgrades your product by a degree. Everything

that is not in your technical specifications will be his playground. He
might decrease the size of one part here, save materials by reducing
the weight of another part there. Many Chinese industries are built
on extensive cooperation, so the product’s ‘modifications’ are fairly
easy to do. An unsuspecting client might feel the glow of pride after
a shrewd business deal, only to realize that the resulting product is
slightly different from a previous shipment or from the provided
sample. In reality, these ‘modifications’ are often unnoticeable. Your
supplier will make sure they don’t stand out. Hence, the deceit is
hidden in plain sight.

2nd Stratagem of 36: Besiege Wei to

Rescue Zhao
Instead of taking a defensive position during enemy's attack,
deliberately cause problems elsewhere, especially where your
enemy is most vulnerable.

When the enemy is too strong to be attacked directly, attack

something they cherish. The idea is to avoid a head-on battle with a
strong enemy, and instead strike at their weakness elsewhere. This
will force the strong enemy to retreat in order to support their
weakness. Battling against a tired and dispirited enemy will give a
much higher chance of success.

The proverb 围 魏 救 赵 / wéi wèi jiù zhào / refers to a well-known

story from Warring Kingdom Period (457-221 B.C.E.) about the
confrontation of two brilliant military strategists, Sun Bin and Pang
Juan, who both excelled in the Kingdom of Wei. As the two
generals struggled for dominance, Pang Juan eventually had Sun
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Bin slandered, tortured and sent into exile. Sun Bin ended up in the
Kingdom of Qi, where he was able to find refuge

Later the Kingdom of Wei declared war on the Kingdom of Zhao

and sent Pang Juan to lead the army. Pang Juan besieged the
capital of the Kingdom of Zhao; Zhao then pleaded for help from
the Kingdom of Qi. The king of Qi gave orders to send his troops.
Sun Bin advised differently. Instead of an immediate clash, Sun Bin
advised waiting until the Wei troops would be weakened by the siege
and then launching an attack with a small force on the relatively
undefended capital of the Kingdom of Wei. He further advised
making an ambush with the main forces on the returning army of
Pang Juan to finish them in one decisive blast.

Sun Bin was successful in his deceit – Pang Juan was first hurried by
Zhao forces from behind and

then decimated by Qi’s main forces in the ambush set by Sun Bin.

This stratagem deals with the importance of prioritization,

concentration and division of force. One should aim an attack at
the enemy’s most vulnerable side. There is no point in fighting
limbs when the heart is exposed. Strike at the heart to make the
whole system unbalanced. Then on can move to destroy a
disjointed body – even its strongest limbs are in its weakest
position. If there are no evident weak spots on the enemy side, then
rearrange your forces to make your adversary believe the offensive
is coming from a place other tha

n where you are actually preparing to strike.

Application

Similarly to the first stratagem, Besieging Wei to Rescue Zhao is

not a unique discovery of Chinese strategists. Military thinkers used
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this strategy countless times through the centuries. Napoleon

exploited this strategy by distressing the Caribbean colonies of the
British Empire in an attempt to lure the British fleet out of the English
Channel so that he could then cross the sea and invade Britain. By
striking at the foreign colonies in the New World, Napoleon was
twisting the knife in the weakest spot he could find; he had already
blocked continental trade for the British Empire. By creating
additional troubles for Britain in the New World, the leader of the
French believed the additional pain would induce a ruthless
reaction. Unfortunately for Napoleon, this strategy did not work.
Napoleon wanted to neutralize the British Empire for a good reason
– it posed the greatest threat to French ambitions. As time passed,
Britain would play the central role in the downfall of the great
French emperor.

In business, PR and marketing, specialists have harnessed

an Besiege Wei to Rescue Zhao strategy for the by influencing
family purchases through their ‘weakest links’ – the impulsive tastes
of their kids. Elsewhere online casinos may offer ‘free’ cash bonuses
upon registration, something that strikes right at gamblers’ weakest
point, prompting an urge they can hardly resist.

Another business example of using the stratagem Besiege Wei to Rescue

Zhao comes from my own experience. When facing an unexpected
challenge from a new and brazen competitor who came to the
market from a related field – but had previously never operated in
this niche – my previous company decided to avoid confrontation
on its own turf. Instead, it outsourced, procured and started
merchandising the competitor’s strategic product at knock-off price.
At the next industrial show, the two CEOs arranged a meeting and
decided to bury the hatchet. Each company would withhold its
marketing activities from other company’s profit-making areas.
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Over 12 years spent in China, I have encountered this strategy in the

repertoire of many Chinese partners in negotiations. Identifying
flaws in cooperation on your side, a Chinese partner would rarely
openly express discontent. Instead, they will leave this card as a strategic
option for future negotiations to cut your claws, when you try to move to attack your
opponent.As a general rule, you may find yourself disarmed by this
blow as your opponent presents the card right in the middle of
negotiations and you have no time to properly prepare your
defence. This is a powerful tool in negotiations that usually brings
about a final success.

3rd Stratagem of 36： Kill

With a Borrowed Sword
Attack using the strength of another when in a situation where
using one's own strength is not favourable. For example, trick an
ally into attacking them or use the enemy's own strength against
them. The idea is to cause damage to the enemy via a third party .
Convince your enemies that they have spies within their own
camp, especially those who pose the biggest threat to you. Make your
enemies dismiss or destroy those ‘spies’ to ultimately weaken their
own positions

The proverb was first used in a theatrical play of Ming dynasty

times (1368-1644 C.E.). It has been cited in numerous literary
works, including all-time Chinese classics like The Dream of the
Red Chamber. Indeed, this deceit is one of the best-loved
strategies in China. It has different variations depending on
connotations. For instance, that means ‘use barbarians to
subjugate their own kin’, was a strategy for dealing with
barbarians around the Middle Kingdom. Another proverb, literally
19 | P a g e

means ‘two peaches killed three warriors’ and offers a great

explanation of the principle of killing with a borrowed sword.

During the Spring and Autumn Period (approx. 771 to 476

B.C.E.), there were three fearless generals in the Kingdom of Qi.
They become so arrogant that they eventually started to pose a
threat to the court. The prime minister Yang Yin decided to
eliminate this threat at an early stage, and so organized a deceit. He
proclaimed that the two best generals would be awarded two
peaches. The generals started to argue and brag about their heroic
deeds. One claimed to have defeated a whole squad of soldiers with
his spear; another declared that he had caught a wild pig and a
tiger alive with his bare hands. Each grabbed one peach, leaving the
third general without a chance to engage in the
competition. Infuriated with anger, the third general pulled out a
sword and challenged the two other generals to a duel. To
everyone’s surprise, the other two generals became ashamed of
their hastiness and pursuit of fame. Not being able to bear the
disgrace, both slit their throats on the spot and died. Having watched
this, the third general also cut his throat. Yang Yin had achieved what
he would have been unable to do in open confrontation

Discussion

There are two basic principles of using the Kill With A Borrowed
Sword stratagem – make the third party fight for you, or disrupt
integrity in your enemy lines, making them fight internally.

In the first case, one should set up circumstances conducive for

the confrontation for his enemy with the third party

In the second case, disinformation is in the core of the

deceit. Nothing hurts as much as a betrayal. This is where rational
thinking usually steps aside, giving way to unbridled emotions. The
20 | P a g e

vestige of doubt unleashes all hidden insecurities, creating havoc

in your enemy’s lines. If the deception is carefully applied, there is
nothing like this strategy to achieve a victory over your opponent

Britain actually paid 1 000 000 pounds to their allies (Austrian and
Russian Empires) for every 100 000 men sent to fight against
Napoleon. More than once the Russian Empire fomented
coreligionists’ nations in the Balkan Peninsula to fight the Ottoman
Empire. One of the hardest blows that precipitated the
disintegration of the Soviet Union was its military intervention in
Afghanistan, where local mujahedeen were actively supported and
trained by CIA in the activity known as Operation Cyclone, the
longest and most expensive covert CIA operation ever undertaken
(1979-1987). In the 20th and 21st centuries proxy wars have
become a common instrument of geopolitical strategizing

4th Stratagem of 36: Await the Exhausted

Enemy at Your Ease
It is advantageous to choose the time and place for battle while the
enemy does not. Encourage the enemy to expend their energy in
futile quests while one conserves their strength. When the enemy is
exhausted and confused, attack with energy and purpose.

Avoid striking first when the enemy is strong. Engage him in a way
that exhausts his energy. Make him fruitlessly chase you, make
him fight in precarious situations. Clash with your enemy only
when he is exhausted

The stratagem was first mentioned in The Art of War by Sun Tzu,
who wrote,
21 | P a g e

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. Therefore, the clever combatant
imposes his will on the enemy, but does not allow the enemy's will to
be imposed on him’.

Chinese sources often attribute extensive use of this stratagem to

none other than the Chinese Red Army in its fight with the
Kuomintang. Communist forces expertly used feints and
misdirection to wear out the enemy forces, then moved to meet
them at the spots where they had strategic advantages, letting them
finish the enemy.

The key element of Awaiting The Exhausted Enemy At Your

Ease is perseverance. Waiting means patience and self-
control. As you lead the game, or ‘impose your will’, make sure
your enemy loses his steam, mentally and physically.

Allocation of this stratagem to the Stratagems When Commanding

Superiority category implies that one should utilize it when in a
position of power. However, the aforementioned example of the
Chinese People’s Liberation Army demonstrates that the weaker
side can also selectively use this method for its own good. However,
it’s also worth reiterating that despite being outnumbered in
general, the People’s Liberation Army usually went into direct
confrontations only when it possessed an advantage in place and
numbers

In the history of warfare, exhausting the enemy by attacking service

corps and supply lines, destroying bridges and infrastructure and
leaving the enemy without food or other necessities is a common
practice. However, there was a time in history where wearing out the
enemy had become a final goal, not a means of reaching strategic
22 | P a g e

advantage. World War I, with its critical technological advancements

in warfare (machine guns, grenades, gas) made conventional rank-
and-file, side-by-side formation for infantry completely useless and
suicidal, driving armies into trenches. This turned out to be a
completely new type of warfare for which armies were not ready.
Decisive military victory in the field became almost impossible.
Instead the war would have to “end by the exhaustion of nations
rather the victories of armies”, according to Winston Churchill. The
world was dragged into a universal war of attrition that took
millions of lives and led to the collapse of four empires (Ottoman,
Austro-Hungarian, German, and Russian).

In business, predatory pricing to weed out competition is one of

the favourite methods of deploying the stratagem. When one of
the competitors has a decisive advantage in the economy of scale,
or holds strategic advantage in a technology or process, he may
decide to force his competition out of the field by dramatically
decreasing prices. Such a predator watches his competition make
futile attempts to compete in price, eventually leaving the market or
getting swallowed by the market leader.

In China, I regularly fell victim to the Await The Exhausted Enemy

At Your Ease stratagem. There are several tricks that are extensively
used by Chinese counterparts to exhaust you before and during
negotiations. The most obvious one is the business dining culture
with obligatory drinking. According to Chinese tradition, everyone
at the dining table should honour a guest with a glass of beer, wine
or baijiu. Of course, you don’t want to insult anybody. The next day
you wake up feeling washed out and head to the negotiations. The
other trick is deliberate procrastination in the discussion of some
important issues that were scheduled in advance. Various excuses
23 | P a g e

are used to leave the discussion to the last moment when you are
already running out of time and readily accept any conditions.

5th stratagem of 36: Loot

a Burning House
Take advantage of the situation when your enemy is in distress.
Strike your enemy when he is down. . If the enemy is in its weakest
state, attack them without mercy and annihilate them to prevent
future troubles. A burning house falls into commotion and tumult.
Thus a thief can seize the chance to loot the property in the house
when the doorkeeper and house guards are busily engaged in
putting out the fire. The ifiom therefore means to take advantage of
someone’s misfortune to do him harm.

In war, a burning house symbolizes a nation that is suffering a major

crisis or is on the decline. By attaching such a nation, one can get
twice the result with half the effort. Thus the strategy advocated the
universal principle of striking at the enemy’s weak points and in this
sense relates to several other strategies. For instance, when one
chooses to set fire to the house before looting it unopposed instead
of squaring with the house guards.

The idea embodied in the proverb can be traced back to the 12

laws of employing ‘ways (art) of deception’ in The Art Of War
by Sun Tzu – ‘when (the enemy) is in disorder, attack and overcome
him’

The classic example of using the strategy of Looting A Burning

House from Chinese history is a story of confrontation of
the Kingdom of Yue with the Kingdom of Wu during the Spring
24 | P a g e

and Autumn Period (app. 771 to 476 B.C.E.). After a defeat, the
king of the Kingdom of Yue, Gou Jian, was taken as a hostage to
the king of the Kingdom of Wu.

Gou Jian was kept hostage for the next ten years, playing the role of
an obedient and submissive servant. Finally, he was allowed to
return to his kingdom, but still surrendered to his master and
rendered yearly tribute. Gou Jian patiently waited for the Kingdom
of Wu to decay, as the king of Wu had become debauched,
arrogant and short-sighted. As time went on, the Kingdom of Wu
was shaken by conspiracies and plots that lead to the execution of
some key advisors to the court. Moreover, the kingdom was struck
by famine. The timing was right. So when the king of Wu went on a
journey, Gou Jian finally made a strike on the crippled state,
overtaking it easily. The king of Wu begged clemency but was only
offered execution or suicide as a way out of his misery.

There are two ways of distressing your opponent, by directly (but covertly)
conducing to his misery, or by watching opponent’s misfortune from a distance before engaging
your enemy in an open fight.

The stratagem clearly violates a taboo: That of not attacking an

obviously vulnerable target, or not shooting a sitting duck,
something stigmatized in all cultures. Nonetheless, it is practised
in politics, business and interpersonal relationships – not to mention
warfare, where no holds are barred

The stratagem is also known as a‘winners always take it all, while

losers are always in the wrong’ that is echoed in another Chinese
proverb

‘if you win you are a king, but if you lose you will be a thug’.
Therefore, it requires the practitioner of this strategy to act from a
25 | P a g e

position of strength, to hush up possible voices of indignation and

protest.

Application

More than once China became not a practitioner but a victim of

the Loot a Burning House strategy. After the First Opium War or
the Anglo-Chinese War (1839-1842), which brought the Qing
dynasty to its knees, more Western Countries joined in, rushing
to Loot the Burning House in a conflict known as the Second
Opium War (1856-1860). Imperial Japan invaded the Northern-
eastern part of China in 1931 to form a puppet state, Manchukuo,
amid a civil war between Kuomintang and the Chinese
Communist Party.

In its most predatory form, pawnbrokers, loan sharks and stock

market vultures are the examples of practitioners of the Loot a
Burning House stratagem. Sometimes corporate takeovers and
acquisitions use the same principle. Poaching the employees of a
troubled company is like the looting of a burning house.

Wenzhou (Zhejiang province, China) was one of my regular

business destinations between 2007-2013. In early 2011 the
business climate in Wenzhou was quite worrisome. Starting from
April 2011, enterprises from various industries began to shut down on
a massive scale, while their executives fled the country (more than 90
reported cases). This unprecedented local economic crisis attracted
much attention from the central government. It became known as
the ‘Wenzhou private lending crisis’. The crisis was prompted by a
flow of borrowed grey market capital into the local economy. With
tightening regulations on borrowing markets in the banking system,
enterprises sought capital elsewhere, and private lending became a
quite widespread phenomenon. At some point, private lending was
26 | P a g e

equal to 1/5 of the total loans of the banking sector in Wenzhou. Up

to 60% of local enterprises engaged in private lending.
Nevertheless, the hunger for capital was not quenched, and so the
interest rates went crazy. According to the monitoring data of the
Wenzhou City Center, the annual comprehensive interest rate of
Wenzhou private lending in 2010 was 14.22%. But in the first half of
2011, the lending rate of social financing intermediaries skyrocketed
to 40%. The annual interest for short-term loans could be as high as
100% and more. It cost the government some time and effort to
bring the financial system back to normal.

he Wenzhou private lending crisis had a lot of underlying causes,

one of which was speculation on the real-estate market (commercial
and residential) of heads of the private companies, who directed
borrowed capital into real estate project. This created a huge
bubble when some people invested in real estate while other
people invested in the people who invested in the real estate.

Thirst for easy money made people blind. But not all of them. Some
managed to increase wealth at the time when the crisis hit the
hardest. As Warren Buffet famously advised, “be greedy when
everyone else is fearful”, and so some shrewd business people
nailed some great deals on commercial equity or manufacturing
equipment for knockdown prices at a time when everything was
falling apart.

6th Stratagem of 36: Feign an Attack

In The East and Attack in The West
Make your enemy misunderstand your movements. Deceive
him into believing that you are striking from one side, while in
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fact launching an assault from another side with all possible

force.

One of the famous historical cases of using Feign An Attack In the

East And Attack In The West strategy in China is the conflict between
a rising Han Dynasty (206 B.C.E.-220 C.E.) that came to power after
the first Chinese imperial dynasty of Qin (221-207 B.C.E.), and a
contending state of Wei at the early period of Han’s unification of
the country after Qin’s collapse.

The General Han Xin of Han was appointed to vanquish the

Kingdom of Wei. In order to invade Wei, General Han Xin had to
cross Huanghe River, where Wei had deployed a massive defensive
line. In order to distract the enemy, Han Xin feigned a false crossing
of the Huanghe where he sent all his ships, set up a military camp
and created the illusion of bustling activity. In the meantime, the
main forces of Han Xin were crossing Huanghe at the section of
river that was so unfit for crossing that the enemy did bother to set
up a defense there. After the crossing of the Huanghe, Wei was
vanquished with ease.

History of warfare is full of cases of the Feign an Attack in the East and
Attack in the West stratagem. Operation Desert Storm, when Iraqi forces
were drawn to the coastline of the Persian Gulf, preparing to repel
the invaders, while the main strike of US forces was made through
the desert, is a great example of such an approach.

In business, making an opponent to misinterpret one’s moves may

be the single most important factor of making a temporary strategic
By veiling the true contributor to
advantage.
success and attributing it to something
different, a company effectively dangles a red
herring across a competitor’s path. For instance, if
one’s advantage is having excellent customer service, there is
nothing like making a competitor think that high performance is
28 | P a g e

due toextensive advertisement’

an ‘ or a
‘competitive pricing’.

By focusing your opponents’ attention on one aspect of

competition, one enjoys much freedom of movement in other
aspects.

In strategic negotiations, Feign an Attack In the East and Attack

In The West has been one of the most favourite stratagems
deployed by my Chinese partners during the time I have spent in
China. Chinese partners rarely get straight to the point of
conversation, as Europeans do. In strategic negotiations when stakes
are high, one must be prepared for certain twists in conversation.
Your reactions and responses will be observed to figure out how to
approach to the actual point of the meeting. Exaggerating one
problem is the usual method to get more benefits with regard to
another problem, which may be the actual point of negotiations.

7th Stratagem of 36: Create

something out of nothing
Make your opponent believe you have that which you don’t have
or that you don’t have that which you have. Mingle both ideas to
completely puzzle your enemy.

In the world, all things are born in being, and being is born in non-
being

The meaning of this famous line is that each thing did not exist
before coming into existense. Therefore, it originated from
nothing. And, so nothing is (or has the potential to be)
everything.
29 | P a g e

The classical explanation of this stratagem in Chinese tradition is a

description of a siege of the city of Yongxiu in the era of Tang
(756 C.E.) by the rebellious warlord Lin Houchao. Defending
General Chang Shun and his detachment were in short supply of
ammunition, so the general ordered the fashioning of 1000 straw
dolls of human height. They dressed them in black clothes, attached
them to ropes and lowered them down at nightfall onto the city
walls. The enemy decided that it was the city’s defenders coming
down the walls. A hail of arrows fell on the straw dolls. Chang Shun
ordered the puppets to be raised and thus produced many thousands
of arrows. Somewhat later Chang Shun ordered real warriors to
descend the walls. The enemy responded with a malevolent laugh
and made no preparations for the battle. A detachment of
volunteers of 500 people, who had left the city, immediately flooded
the camp of Lin Houchao, set fire to the tents, killed some of the
besiegers, and dispersed the remnants in different directions.

Discussion

The stratagem Create Something Out of Nothing is aimed

at achieving a change of views of opponents or some real
changes in the current situation with the help of a feint. By
extensive use of feigning one can combine fiction and reality, thus
changing the view of the opponent, or suddenly turn fiction into
reality, thus changing the whole situation.

Usually, people manage their resources as received. Only true

visionaries can look beyond what is given. One who can stand
above this limitation to add ‘more figures to the chessboard’, may
become a prize-taker

Feigning was always a part of warfare. Appearing small to entice

engagement or appearing big to demoralize opponents are
30 | P a g e

common forms. Rhere is a fine example in history, when the victory

over the enemy was truly achieved out of nothing, due to the wit of
just one person – the early Greek
scientist Archimedes. Archimedes used mirrors as a defensive
weapon to concentrate light and burn the enemy fleet during the
Roman siege of Syracuse.

One of the more enduring tales of military might destroyed by a

secret weapon involves the mathematician Archimedes. The year
was 212 BC. Rome had laid siege to Syracuse. All seemed lost until
the Sicilian mathematical genius wheeled out a big round mirror.
Using it and smaller mirrors to concentrate the sun's rays on the
wooden ships, Archimedes managed to kindle a flame and
incinerate the entire Roman fleet. Artists and ancient historians
celebrated the event, but people have long wondered whether
Archimedes' mirror was just a myth.

In business, one of the examples of deploying the Create

Something Out of Nothing stratagem is when a company enters
the downstream industry to ensure sales and distribution. So, for
instance, Boeing created United Airlines, which became Boeing’s
loyal customer and helped the company to fight its competition in
the aircraft industry. One of my partners, a company engaged in
construction machinery leasing, created a parallel business for
distribution of industrial tires from one of the Chinese
manufacturers. The main business consumed tires in great number,
so the company decided to dramatically decrease the purchasing
cost of tires through the direct cooperation with manufacturers, and
also entered and subsequently took over the former local supplier’s
business.
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8th Stratagem of 36: Openly Repair the

Walkway, Secretly Cross Chengcang
Action
Demonstrate determination to take one course of action which is
hard to achieve and gives your enemy a false sense of
security; secretly take a short-cut and charge your enemy out of the
blue.

n the 6th stratagem, which we reviewed several days ago, we

described how the prominent general of Liu Bang, Han Xin, used a
deception strategy to convince the army of Wei that he intended to
cross Huanghe river in one place, while actually passing Huanghe
from another place. A kindred strategy was used in a campaign
against another state of Chu. At some point during the
confrontation, Liu Bang feigned to be submissive to the king of Chu,
Xiang Yu. He receded to his state, burning all wooden bridges on his
way, to demonstrate that he would not attack Xiang Yu and also
ensuring his own safety. At some point, when the confrontation
spiked with a new force, Liu Bang sent more than 10,000 men to
repair the pathway. The project was arduous and the project would
take years to be completed. Xiang Yu was appeased for the time
being. In the meantime, the General Xin took a secret short-cut
through Chen Cang to advance on the enemy, taking them
completely off guard.

Discussion

The 8th stratagem is partly a repetition of the 6th. Many

allusions in Chinese history refer to the same historical figure of
General Han Xin, one of the greatest military men in the story of the
rise of the Han Dynasty. Indeed, Openly Repair The Walkway,
32 | P a g e

Secretly Cross Chengcang is a variation of Feign an Attack in The

East and Attack in The West

The only difference is in the feigned action. By ‘openly repair the

walkway’, one lulls the enemy into a false sense of security as the
time of possible attack seems to be distant and its progression is
observable. In ‘feigning attack in the East’ one doesn’t lull, but
disturbs the enemy.

Application

One of the great historical examples of the implementation of this

stratagem was a breakthrough operation by the infamous pirate Sir
Henry Morgan, when he was blocked in Maracaibo Lake
(present-day Venezuela) by the Spanish Royal Fleet. In order to
return from the lake to the ocean, ships had to pass by the fortress
with canonry deployed in the direction of the passage. In addition,
opposite the fortress, there were three Spanish ships

To deceive the enemy, Morgan feigned surrender, then approached,

set on fire or otherwise captured all three Spanish ships. Next, pirates
began preparing for the assault on the fortress from the land. In the
eyes of the garrison, dozens of boats filled with armed men
departed from Morgan’s ships. All the boats returned empty. The
landing operation continued for the whole day. Preparing to fight
from the land, the Spanish moved all the guns to the opposite part of
the fortress.

At night, without raising sails, moving due to the force of the

stream, the pirates left the lake. There were no shots from the
fortress. The mass landing was fake. When returning to the ships,
the pirates lay down at the bottom of the boats. The same people
travelled several times between the ship and the shore to create the
illusion of a mass landing.
33 | P a g e

In business, luring the competition to pursue wrong customers is

one of the great examples of deploying the stratagem Openly
Repair the Walkway, Secretly Cross Chengcang. A customer may
seem like a golden goose, while in fact they may generate losses
and create problems. Finding ways to lose such customers to the
competition can strengthen the organization and even help the
company to sink the competitor

A few years ago, one of our suppliers regularly failed on timely

shipments. At some point, our side started to deliberately
exaggerate the consequences of such delays to our business due to
the penalties for undelivered goods to our downstream customers.
An official claim from the CEO preceded a final meeting to settle the
issue. At the meeting, the Chinese counterpart prepared to take a
defensive position as the amount of compensation was
considerable

We touched upon compensation only at the beginning of

negotiations and only to emphasize how harsh was the
environment and how difficult it was to maintain the market share.
The CEO’s main message was to convince the supplier to provide
the respite of payment to expand the business. Instead of giving the
Chinese counterpart a convenience of contemplating everything
calmly, the question was posed at the meeting where the opponent
prepared and was waiting for another battle

9th Stratagem of 36: Watch the Fires

Burning Across the River
When there are multiple opponents, withhold yourself to make
others fight first. Observe their strengths and weaknesses,
34 | P a g e

make them exhaust their energy. In the right time, march in with
fresh forces to crush them all. This can also be used when you
are in an alliance by putting the allies in the front or giving them
the harder battles to fight. Another use is to wait for internal
conflicts to tear the enemy apart. You can help this by sowing
stories of treachery or playing to the personal ambitions of
individual generals.
In wrangles between Chinese states, two Yuan brothers went
to Gongsun Kang for help in fighting a third brother who
had allied with the powerful Cao Cao (who knew about this
move). Kang beheaded them and sent their heads to Cao Cao
who made him a duke as a reward. Both had used conflict
within the Yuan family to further their ends.
In the 1930s, Japan waited for the communist revolution in
China to weaken the country before invading in 1938.
This stratagem is best when there are multiple warring
parties, each trying to beat all the others. It can be helped by
winding up individual sides, reminding individuals of
grievances and so on.
One of the games of business politics is to provoke
competition between other departments or rivals and let
them get in trouble before the provocateur steps in to take
over.
In business competition, the first people to market have to
spend so much in developing products and customer need that
they are weakened for the subsequent competitive battle as the
market flattens and price competition comes to the fore. This
is the opportunity for the low-cost producer to enter the
market.
The proverb has a close alternative, which may be more known in
the Western world: Sit on the Mountaintop and Watch Two
35 | P a g e

Tigers Fight. In the story here, Bian Zhuangzi, a statesman from

the city of Bian in the Kingdom of Lu (1027-250 B.C.E.), was
renowned for killing two tigers in one action. This happened
when Bian Zhuangzi was hunting and saw two tigers fighting over
the corpse of an ox. Bian Zhuangzi took a sword to kill the tigers,
but his advisor stopped him, saying the tigers would fight until one
died and the other was wounded and could be easily killed. Bian
Zhuangzi took his advice, waited, and easily finished off the
surviving tiger.

Calculated inaction is in the heart of the stratagem Watch the

Fires Burning Across the River. As one oriental proverb says, ‘If
you wait by the river long enough, the bodies of your enemies will
float by’. Nevertheless, one should not confuse inaction with
procrastination or paralysis of will, when one surrenders to a
whirlpool of events and leaves his fate to the mercy of chance.
Quite the Calculated inaction is in the heart of the
stratagem Watch the Fires Burning Across the River. As one
oriental proverb says, ‘If you wait by the river long enough, the
bodies of your enemies will float by’. Nevertheless, one should not
confuse inaction with procrastination or paralysis of will, when
one surrenders to a whirlpool of events and leaves his fate to the
mercy of chance. Quite the contrary, one proactively decides not to
act while staying vigilant and watchful.

While deploying the stratagem, one can secretly wind up conflicted

parties but should detach himself out of the conflict so as not to
take sides and be dragged into the fight

In WWI only six European nations stayed out of the terrifying war of
attrition – Denmark, Switzerland, Norway, Sweden, Spain and
Holland. Despite the adversities of wartime, that affected
36 | P a g e

populations of even neutral states, these countries came out of the

Great War in a much better economical position than the warring
states, with maybe the exception of Spain. It is believed that the
renowned prosperity of Scandinavian countries and wellness of
Swiss life is rooted in their neutrality in this first global war

Doing business in China, I used to be on the side that practised this

principle. Acting as the officially appointed China representative of a
foreign company, I was always sent out to fight the toughest fights
before my CEO stepped in to play the role of ‘good policeman’. In
negotiations, I always used to ask for more than could realistically
expect. The CEO would observe the brawl from ‘the opposite
shore’ for some time before stepping in to play our positions back
to what was believed to be the best possible outcome, acceptable
for both sides. It was believed that after the initial fight with a
ruthless opponent, Chinese partners gratefully accepted more
agreeable terms when dealing with a moderate opponent.

10th Stratagem of 36: Hide a Knife

in a Smile
A (supposedly) old Chinese saying goes: "Behind the smile, a hidden
knife!" According to the medical practice and research group Mayo
Clinic™, “passive-aggressive people tend to express their negative
feelings harmfully, but indirectly.

Gain your adversary’s trust, by sending gifts and signing treaties. Present
yourself harmless before taking one decisive strike. The enemy who
feels threatened will put up a fight; the enemy who is appeased
is an easy target. The value of this stratagem is in controlling the
time of one’s fight. One is to decide when a fight suits one’s best
37 | P a g e

interests, as opposed to fighting at a time imposed by the enemy

or by a spontaneous turn of events.

In traditional warfare, we find cases everywhere, not only in China.

The Greeks famously used the wooden statue of a horse to convince
the Trojans that the Greek forces had left the vicinity of their
city. What looked like a friendly gesture was, in fact, a murderous
weapon. The St. Bartholomew's Day massacre in medieval France
that led to the execution of French protestants by Catholics became
possible via a carefully planned deception, luring leaders of the
protestant movement in Paris by arranging a marriage of King
Charles IX’s sister Margaret to the Protestant Henry III of
Navarre Kingdom. Intervention by invitation or humanitarian
intervention in many cases turn out to be examples of the Hide a
Knife In a Smile stratagem. Often by offering help, great powers
impose their will on weaker states. In less severe cases, a great
power pursues its own agenda, one that rarely coincides with the
interest of the struggling state.
The St. Bartholomew's Day Massacre was a widespread slaughter of French Protestants (Huguenots)
by Catholics beginning on 24 August 1572 and lasting over two months, resulting in the deaths of
between 5,000 and 25,000 people. It began in Paris when the Catholic faction, fearing a Huguenot
uprising, assassinated the leading Protestants who were there for a royal wedding.

The massacre erupted after years of religious tension in France, beginning with the spread of the 'new
teachings' of the Protestant Reformation c. 1521, worsening after the 1534 Affair of the Placards,
and becoming armed conflict in 1562, setting off the French Wars of Religion (1562-1598). The
third war concluded in 1570 with the Peace of Saint-Germain-en-Laye, negotiated by the Protestant
Queen of Navarre, Jeanne d'Albret (l. 1528-1572), and the Catholic Queen Mother of
France, Catherine de' Medici (l. 1519-1589). In the hopes of establishing peace, a marriage was
arranged between Catherine's Catholic daughter Margaret of Valois (l. 1553-1615) and d'Albret's
Protestant son, Henry of Navarre (later King Henry IV of France, l. 1553-1610).

In business, turning negative PR into positive branding may be a

good example of using the stratagem of Hide A Knife In A
Smile. Marina Shifrin became an instant media star by filming
herself quitting her job at a Taiwanese Media Animation company
38 | P a g e

while doing an ‘interpretive’ dance to demonstrate all her

grievances. The company responded in a brilliant way – by releasing
a reciprocal musical video, where other employees made an
interpretive dance to describe their company’s culture and also
informing that the company is hiring. Using positive attitude to deal
with complicated matters is worth admiration, but one should not
be mistaken of the nature of this smile – whom it was aimed against
and what goals it was achieving.

In business negotiations, apparent mildness of temper and self-

restraint usually are the signature features of the Chinese
counterpart. This may be misleading for an opponent from the
Western world. For instance, a Westerner cannot always understand
when the negotiations are over. One might still be trying to push
through an agenda at the meeting table when his Chinese
counterpart is already texting a colleague to take the action to cut
him out of the game.

There are lots of ways to quit a job. You can storm out, have a quiet
meeting with your boss, or do something in between. Alternately,
you can do what Marina Shifrin did and air your grievances at
length Shifrin was getting increasingly frustrated with her job at
Next Media Animation, which produces satirical animated videos
based on news content. She was upset with the number of hours
that she was working and what she viewed as a cynical obsession
with traffic and quantity over content quality.
She said her boss, after she told him she was having trouble getting
everything done, told her to "make deadlines, not art." Eventually
she'd had enough, and decided to jump ship in a particularly
creative fashion
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11th Stratagem of 36: Sacrifice A

Plum Tree to Save a Peach Tree
Sacrifice small to gain big. Concentrate power for a decisive strike
even at the cost of losing in other battles.

He who would accomplish little must sacrifice little; he who would

achieve much must sacrifice much; he who would attain highly must
sacrifice greatly. Power means happiness; power means hard work
and sacrifice. I think that the good and the great are only separated
by the willingness to sacrifice.

The proverb was originally mentioned in the collection of poems

composed in a folk song) by Guo Maoqian (1041-1099). A poem
of interest describes how a plum tree gives its life to save a
neighbouring peach tree against the attack of noxious insects. The
poem ends with a rhetorical question: If the trees care about each
other, how can brothers forget their fraternal love?

One of the traditional stories to exemplify the use of stratagem

of Sacrificing a Plum Tree To Save a Peach Tree is a famous tale
from the times of Warring Kingdom Period (457-221 B.C.). It tells
of how a renowned military man, Sun Bin (already mentioned in the
history part of stratagem 2) became known in the Kingdom of Qi,
where he went into exile after being slandered and tortured by his
adversary Pang Juan in the Kingdom of Wei.

The tale has a name –‘Sun Bin and horse racing’– which is known
to every Chinese. After getting to the Kingdom of Qi, Sun Bin has
become a friend with a high-ranking general of Qi, Tian Ji. Tian
Ji frequently bet on horse races with the king of Qi. Sun Bin, a
regular visitor to the races, noticed that the horses were divided
into three classes and well-matched to each other. So he advised his
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friend on a strategy than helped Tian Ji to beat the king. Sun Bin
advised putting Tian Ji’s weakest horses against the king’s strongest,
Tian Ji’s strongest horses against the king’s medium and Tian Ji’s
medium horses against the king’s weakest. Tian Ji followed Sun
Bin’s advice and won the race 2 to 1. Tianji sacrificed the first
round for sure to guarantee the other two victories. Tian Ji was
so impressed with the wit of his friend that he immediately
introduced Sun Bin to the king of Qi, who later appointed Sun
Bin as a general to fight his famous fights with Pang Juan.

Sacrifice the part for the benefit of the whole – this profound
idea requires strategic view and long-term thinking to prevail over
the blindness and waywardness of immediate impulses. Quite often
people lose everything because of an inability to compromise
their pride or unwillingness to fight their greed.

Losses are inevitable for all of us, but only a man of wisdom has
the power to choose his defeats. And by carefully choosing his
defeats, the wise man also chooses where he chooses to win.

There is quite an explicit dual example of implementation and

violation of this stratagem in the history of wars. This was a
confrontation between the Russian Communists and royalists
(White Army) after the collapse of the Russian Empire. The
communists, who came to power after the October Revolution in
1917, were holding Petrograd, the capital, but their positions were
weak, and the future seemed bleak and uncertain. In order to
concentrate military power, the communists made a decision to
secede from WWI and surrender contested territories to the states of
the Central Powers (German Empire, Austria-
Hungary, Bulgaria and the Ottoman Empire) in March 1918. By
the peace treaty, Russia lost Poland, the Baltic countries, Ukraine,
41 | P a g e

Belarus and Finland in Europe. It was just three months before the
end of the war, in which Russia would come out on a winning
side. Subsequently, the Civil War burst out in Russia between
communists and royalists. The royalist movement was hugely
affected by imperial sentiment. More than once leaders of new
governments from Ukraine, Finland and Baltic countries offered an
alliance to White Army leaders to fight the communist threat in
return for recognition of their young states. Such propositions were
always rejected. The flexibility of one side, willing to sacrifice a
part to save the whole, versus the short-sightedness of the
other side, willing by contrast to sacrifice everything for the
sake of a principle, predetermined the outcome of the war. As
for the communists, after the Central Powers had fallen, the peace
treaty was rendered invalid. The Soviet Union crushed Ukraine in
1920, split Poland to take in Western Ukraine and Belarus in 1939
and later annexed Baltic countries in 1940. In the same year, the
Soviet Union made an attempt to crush Finland but was stopped by
the bravery of Finnish military forces. Nevertheless, after the
humiliating truce of 1918, the communists win back all their
losses.

In the business world on the macrolevel, killing business units to

revitalize the company is one good example of implementation of
the stratagem. Leaving one market to concentrate on another is
another use of stratagem. On a microlevel, however, everything that
implies ‘free for the customer’ may be a form of Sacrifice a Plum
Tree To Save a Peach Tree – for instance, by providing a free
version of an app with limited functions, an app developer may lose
some potential deals, but he also gains much bigger exposure to
users who will buy a full version later
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As opposed to Westerners who sometimes take negotiation as

a zero-sum game, Chinese traditionally adhere to the Doctrine of
the Mean or Middle Way that is a part of the Confucian tradition.
By avoiding extremes, thus following the path of the Middle Way,
Chinese usually imply reciprocal concessions during interaction with
opponents. It is considered, that even in the straightforward
situations when one is right and other is wrong, one should sacrifice
a part of one’s victory to help another party to save face. By
practising the principle of Middle Way, Chinese partners usually
deliberately choose where they wish to cede, and where they
choose to prevail. Such mental practice is quite useful for successful
negotiations.

12th Stratagem of 36: Take Away a

Goat in Passing
Take Away a Goat in Passing / See and Use luck

Be prepared to take advantage of an opportunity once it presents

itself. The enemy’s slightest weakness may play to one’s
benefit. So, one should keep a sharp eye out to observe and
interpret the current state of play, allowing one to act fast when a
‘goat goes astray

The traditional story depicting the use of the stratagem is

B
the attle of Fei River or ‘Feishui’ (383 C.E.) during the time
of Sixteen Kingdoms (304-439 C.E.). The Former
Qin Dynasty was decisively defeated by the numerically inferior
army of the Eastern Jin Dynasty. In this campaign, Qin’s army
constituted close to 1,000,000 men. This massive aggregation,
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although poorly aligned and consisting of people of different and

sometimes feuding clans and tribes, still presented an unseen force.
Its size instilled great confidence in Fu Jian of Qin who famously
noted that his army was so huge that if all the men would throw
their whips into the Yangtze River, its flow would be stopped.
Indeed, this armada was destined to crash into Jin. However, in its
massiveness lay its greatest weakness – one that was used against it
by Jin generals when an unexpected opportunity presented itself.

In the decisive battle, two armies met alongside the Fei River. Jin
permitted Qin to slightly retreat, allowing Jin’s forces to get across
the river so that the two armies could engage. Fu Jian of Qin gladly
agreed as he planned a treacherous attack during the passing of
Jin’s forces.

However, as the retreat order was made, Qin soldiers in different

corners of the massive army began to speculate over the reasons
for the retreat. The restless whispering soon raised into a clamor,
insisting that ‘The Qin army has been defeated’ and stoking fear in the
soldiers. The tactical retreat turned into a stampede. The Jin generals noticed
the chaos and duly took advantage of it. Soon the vanguard of Jin
hit the retreating rear-guard of Qin vanquishing the great army with
ease.

Jin forces used a chance that was neither planned nor could be simulated . The
opportunity just presented itself and was rightly used by the Jin

This battle is considered one of the most important battles in

Chinese history. In the aftermath of the battle, Former Qin plunged
into a massive civil war that eventually collapsed, ensuring the
survival of Eastern Jin and subsequent Han-dominated regimes
south of the Yangtze.

The relative strength of warring sides is usually a fixed value. It

creates a greater likelihood of victory for one side over
44 | P a g e

another. When using these advantages or disadvantages during

the real confrontation, along with objective factors, subjective
factors also play a significant role. Even the strongest enemy
is far from being omnipotent or omniscient. Even the most
daunting opponent makes blunders. We all do. But we are usually
too self-absorbed to notice or too intimidated to take advantage of
an adversary’s mistakes

In other words, a wise man uses subjective or personal

advantages, such as his intelligence and wit, to take the enemy
unawares, to change the fixed value of the relative strength

We can find sister cases in business to match the example from

Chinese history described above. Think of all those organizations
that became too big to be responsive to market needs. This is when
more flexible and sharp companies come upon the stage and
snatch opportunities out of a sluggish leader’s hands. One such
example is the success of Japanese automakers in the American
market. In the 1970s, when the oil crisis and economic instability hit
the economy, fuel efficient and cost-effective alternatives from
Japanese manufacturers substantially grew in popularity and
became a real challenge for local American brands.

Staying vigilant in an ever-changing business environment is an

essential trait of lasting business organization. Such companies stay
attuned to the industrial news and competitive landscape to take
advantage of changing situations. In my opinion, regular
benchmarking is another great way to seize passing ‘goats’

13th Stratagem of 36： Beat the

Grass to Startle Snakes
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When your adversary’s intentions are obscured, take your enemy by

surprise by creating an unexpected turn of events to make
him expose his weaknesses/whereabouts/intentions through an
overreaction. Use this information to change your course of action
accordingly.

This stratagem allows you to gain power, prompting the enemy to

respond. Any reaction carries information.

Alternatively, one can use the Beat The Grass to Startle

Snakes stratagem to daunt the opponent and prevent him from
making an action unfavourable to you.

In the history of warfare, the use of reconnaissance as a method

of obtaining relevant information about the enemy through
combat contact by specially prepared units is the best example
to illustrate the stratagem Beat The Grass To Startle Snakes

In business, when dealing with customers, we consider a cut-

and-try approach that companies use to identify the best
course of action (such as A / B testing, pilot projects) to be a
manifestation of the principle underlying this stratagem. For
instance, by introducing a so-called New Coke in 1985,
the Coca-Cola Company startled its core customers and made
them vigorously protest. In the end, Coca-
Cola reintroduced Original Coke and enjoyed handsome growth
in sales of its traditional drink. This made some speculate that
the introduction of New Coke was a smart marketing campaign,
something that Coca-Cola never acknowledged. In any case,
‘Beating the Grass’ certainly helped the company to better
understand its customers.

Another manifestation of the stratagem in business is putting

out misleading information about your product status.
Companies may deliberately spread messages about product
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release times, the specification of the new models, and so on.

The reaction of competitors may be rather insightful

14th Stratagem of 36：Borrow a

Corpse to Save a Soul
Observe the old means of the past to identify some that can
be applied to the present situation. Alternatively, use something
new to which you add the flavour of the past.

Revive something from the past, and re-invigorate or re-use it for

another purpose. This can be an old idea, an old technology or a
method that has been forgotten. Adapt them, you can even infuse it
with modern technology and make it useful for your own purpose

The expression may have originated from a legend about one of the
‘Eight Immortals’ of the Taoist pantheon of saints – Li Tieguai.
According to the tradition, the Eight Immortals became holy spirits
by practising the secret arts of Taoism; one of them was LI Tieguai.
Before turning into an immortal Li Tieguai carried out ‘spiritual’ (ex-
corporeal) travel to the island paradise to meet other immortals. His
apprentice was watching over the spiritless body and was ordered
to burn it if the master did not return after seven days. The
apprentice cremated the body slightly earlier than planned, making
his master seek another body to inhabit. He finally seized the corpse
of an old beggar who had just died of starvation nearby. Thus, Li
Tieguai saved his soul by borrowing the decaying body of
somebody who had died.

Therefore, reviving something from the past, whether it is a

technology, fashion or idea, and giving it a new purpose, may
create a huge advantage and even be the source of a
47 | P a g e

breakthrough. Remember how the Chinese were using gunpowder

for centuries before Europeans finally borrowed this ancient
technology, completely changing the course of history in their
favour

In warfare, ironically, dead bodies were used throughout the

centuries to deceive the enemy. For instance, the most
renowned Roman gladiator of all time was arguably Spartacus,
who led a powerful slave revolt against the Romans. The Roman
army caught up with Spartacus finally, and a decisive engagement
seemed to be inevitable. Spartacus ordered his men to set up a
fortified camp and tie dead bodies to the piles erected around the
camp. Campfires were set around the perimeter. The Romans chose
to wait until the next morning, assuming the enemy was under their
control. In the dead of night, Spartacus’ army sneaked out of the trap
unnoticed.

In business, people use redecorated ideas from the past all the time,
whether it is an old fashion from the 60s in the new garment
collection of a famous brand or a remake of a once famous movie.
Sometimes companies roll out ‘classic’ versions of their old
products to generate hype and appeal to the core fans. Successful
businesses remember that it is not a novelty that determines
success but differentiation.

Mergers and acquisitions may p

rovide some examples of utilization of the stratagem Borrow a

Corpse to Save a Soul.

15th Stratagem of 36：Lure The

Tiger Out Of The Mountain
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When the enemy is uphill, by no means rush at him in his

stronghold. If the enemy’s position is superior, find a way to get him
away from his advantage. Bait him, make him to lose guard by
finally stepping out of his favourite turf.

The expression in its earliest variations is found in an ancient

Chinese political and philosophical text, the ‘ Guanzi’ that is named
for and traditionally attributed to the statesman Guan Zhong, who
lived as early as the 7th century B.C.E. The expression in Guanzi,
not yet in its present familiar form, undoubtedly preceded the
traditional four-character idiom of later times – ‘When a tiger or
leopard leaves its lair and approaches people, they become the prey
of people. As long as a tiger or leopard relies on its lair, it manages
to maintain its strength.’ The proverb was later widely used in
Chinese literature.

One of the classical Chinese historical cases exemplifying Lure The

Tiger Out of The Mountain is a story of the suppression of
insurgency of the Qiang people by General Yu Xu of Eastern Han
(25-220 C.E.). The Qiang people were a northern tribe who
revolted again the court, and Yu Xu was assigned to suppress the
insurgency. Qiang stopped the advancement of Yu Xu’s forces at
the gorge of Xiao Mountain. The general saw the situation as
disadvantageous. He retreated from the gorge and set up camp in
the distance, sending messengers to ask for reinforcements from
As the Qiang people realized there
the capital.
would be no immediate attack, they became
increasingly careless. Eventually, some of
the Qiang detachments started temporarily leaving the gorge to
plunder local inhabitants. At the right moment, Yu Xu ordered
his forces to march straight to the gorge. As the army approached
Yu Xu ordered additional fires to
the gorge, be lit, to make
the Qiang people believe Yu Xu was coming with
49 | P a g e

reinforcements. The remnants of the Qiang people, who were still in

the gorge, were so terrified that they did not dare to engage the
enemy, letting him through

There are two basic principles of how to get a tiger out of his den –
by provoking him or by besieging him. In the first case, a tiger
figures out that you are in a weak position, so he advances at you.
In the second case, you get to him close enough to cut off all the
supplies and wait for him to come out at you already exhausted. In
either case, you pull even with your enemy

A feigned retreat to draw out the enemy is probably one of the

most widely used deception strategies on the traditional battlefield.
This was a favourite tactic of the Mongols while conquering the
world. Very well trained and organized warriors, Mongols could
perform complicated maneuvers, pretending to show disarray and a
hasty retreat to lure the enemy out of the battlefield, dilute his forces
and finish him with ease.

In business, offering a competitor a confrontation in your area of

expertise is the best realization of Lure the Tiger Out of the
Mountain. The area of expertise may be a process or a product.
Provided that a company excels in business, its business model will
usually be closely analyzed and, whenever possible, copied by
competitors. If the company of interest holds a strategic advantage
that is difficult to replicate, the competitors will inevitably take a
beating. This was the case when Microsoft decided to
confront Apple with its mp3 player Zune. This became one of the
biggest failures in the company’s history. Compared with the iPod,
Zune arrived too late, looked boring, could not offer accessories
and was priced nearly as much as the market leader’s flagship
product. Microsoft was far away from its traditional stronghold and
paid for it dearly
50 | P a g e

In business negotiations, creating mildly uncomfortable

circumstances for talks may describe the principle of using the
stratagem Lure The Tiger Out Of The Mountain. Such simple
tricks as arranging a meeting’s physical location or time on your
terms may help in negotiation. For instance, if the opponent is in a
hurry, setting a meeting in one week from now for whatever reason,
may help you to control the agenda at the actual meeting. Of
course, this holds true only when one is in an advantageous
position, as the stratagem’s grouping suggests.

16th Stratagem of 36：To Catch

Something, First Let it Go
Don’t drive your opponent into a corner. A
cornered rat bites a cat, a trapped enemy may be more dangerous
than ever. When your adversary is retiring pell-mell, let him do so
and exhaust his remaining energy before capturing him. If no
retreat is possible, demonstrate your superior power to demoralize
the enemy, causing them to abandon all resistance and surrender

Zhu Geliang served the Kingdom of Shu and led a military

campaign against the region of Nan Zhong and its charismatic
leader Meng Huo. Zhu Geliang understood the local sentiment
towards the beloved leader, so instead of crushing Meng Huo, he
decided to win his loyalty. Subsequently, Zhu Geliang captured
and released Meng Huo seven times, each time demonstrating his
good will. At first, Meng Huo did not feel obliged to respond
to Zhu Geliang’s kindness. After all, Zhu Geliang was an
oppressor coming to his land. But with each defeat, followed by a
demonstration of great kindness, the initial feeling of rectitude
started to wear off. Meng Huo was increasingly in debt for his life
51 | P a g e

to the mercy of Zhu Geliang. After the seventh and final

fight, Meng Huo recognized his defeat and proclaimed his loyalty
to the Kingdom of Shu.
The stratagem To Catch Something, First Let It Go brings our
attention to the fact that domination may sometimes require so
many resources that it is just not worth the cost. Zhu
Geliang understood that by conquering Nan Zhong he would not
resolve the issue of unrest in the South of the Kingdom of Shu.
Maintaining the region under control would deplete Shu. By
releasing Meng Huo, Zhu Geliang restrained him more tightly than
he could by vanquishing Nan Zhong

Usually one should practice To Catch Something, First Let It

Go only when the relative cost of vanquishing the enemy is
higher. Sometimes, however, the concern of disrupting division
of powers may be the reason to consider letting the enemy go

The violation of the stratagem To Catch Something, First Let It

Go can be exemplified by the short-sightedness of winning side
in WWI, who enforced such humiliating and devastating terms
on Germany, that it kindled immediate reaction among Germans. A
fast-fermenting revanchist politics followed. By driving Germans
into a corner, the winning states indirectly contributed to bringing the
Nazi government to power. In all likelihood, Germany would have
been a different state, more integrated in the new world order and
less prone to the seduction of the extreme right, if it had come out
of WWI with more dignity

In business, disrupting the status quo, especially in oligopoly-

dominated markets, may bring far-fetching consequences that are
hard to foresee. By vanquishing a key opponent, a company may
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distress the supporting upstream or downstream industries. It may

also trigger off a war of ‘all against all’. Diminished competition can
make a company less sensitive to new threats

In denser markets with multiple market players, competitors are the

main source of market intelligence. By keeping a watchful eye on
competitors, one can observe how the new products are received
by customers, what prices are acceptable by the market, what
marketing tools are effective

Chinese industrial clusters, with hundreds of companies in the close

vicinity and engaged in the similar activity by producing the same
range of products, is an example of collective unconscious use of To
Catch Something, First Let It Go. Entrepreneurship is for everyone
to participate in. It creates wide cooperation, an abundance of
workforce and supporting industries and expertise. This does not
mean Chinese don’t compete – they do. They are just more tolerant
of the culture of competition and are willing to benefit from it.

17th Stratagem of 36：Exchange a

Brick For a Jade
Trade something of small value for something of more value. By
precisely identifying the needs of the opposite side, find a way
to satisfy this need, then request something you truly want in
return.

The proverb can be traced back to Tang dynasty (618-907

C.E.) and originally described a story of the poet Chang Jian who
famously used a ploy to achieve collaboration with much more
renowned Zhao Gu. Learning of a tentative visit of Zhao Gu to
the Divine Rock Temple in Suzhou, Chang Jian scribbled half of
53 | P a g e

his poem on the wall of the temple. When passing by, Zhao Gu was
unable to fight temptation and finished Chang Jian’s poem

People value and crave different things. Although ‘things’ are

usually connected to physical items, what people truly want
is emotional satisfaction. Some people desperately need to boost
their vanity; others need to quench their greed; some people need
safety; others need pleasure. By appealing to these deep emotions
and needs, one can offer a trifle as long as it serves its purpose,
but request something much more valuable in return.

Implementation of soft force may be as effective as brute force.

Great powers in the world order employ the principle Exchange a
Brick For a Jade by providing financial/military/other help to
deprived states or nations. They further request loyalty and
obedience from their inferior allies. History knows other examples
whereby private personalities gained incredible power over national
governments. This is a so-called oligarch system – when a small
circle of business people coerce politicians to pursue their personal
economic interests by using national resources

In business, companies readily offer ‘bricks’ to their customers. It

can be as simple as free products or services as a part of a loyalty
program and going to more elaborate cases when customers truly
enjoy very valuable products absolutely free of charge. Wechat, the
Chinese mobile instant messenger, is one of those more advanced
cases. It was not clear how Tencent would monetize the application
at the very beginning. Yet soon it was clear that Wechat was
destined to be a big thing, as it virtually connected all of China in
one huge network of information sharing. Users were Tencent’s
jade
54 | P a g e

Acting as a representative of the foreign company in China, I

encountered several cases of being an object of implementation of
stratagem Exchange A Brick For A Jade by being offered presents
and tokens of appreciation from our suppliers. If you are a decision
maker, but not a business-owner, prepare yourself for being offered
cashless gifts now and then. The newest model of iPhone or tablet
PC will appear at your desk – just as a friendly gesture, a thank you
for your outstanding role, in this thriving relationship. Nothing is
asked in return, but surely these are the stones that will be traded
for jade in the later course. An organization is only as strong as
strong as its weakest link. And by further weakening a sensible
link that already wavers by its intrinsic greed and envy, one can
attain a hidden agenda with the organization as a whole.

18th Stratagem of 36：Capture the

Ringleader to Catch the Bandits
Deprive your opponent of their leader to destabilize and demoralize
them.

The proverb has more than 1200 years of history. We encounter the
expression in the poem of a renowned Chinese poet of the Tang
dynasty, Du Fu, ‘On the Border’. In fact, the whole poem sounds
like a thesis on art of war. We shall introduce its translation
from ‘Selected poems of Du Fu’ by Burton Watson (Columbia
University Press, New York):

If you draw a bow, draw a strong one,

If you use and arrow, use one that’s long.

If you want to shoot a man, shoot his horse first;

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If you want to seize the enemy, first seize their leader.

But killing people has limits too;

guarding a state, there’re boundaries to be observed.

So long as you manage to keep invaders out –

What point in just seeing how many you can kill?

The poem of Du Fu refers to the actual historical event of war

between the Chinese Tang dynasty and Tibetan kingdom of Tubo,
where Tang sacrificed countless soldiers in useless campaigns,
entering deep into Tibet. As we can see, winning without a fight or
rather smart use of the resources at one’s disposal is praised not
only by Chinese war strategists but by other intellectuals as well.

Human organizations are usually hierarchal systems. Think of

armies, companies, associations, or even cycling clubs. The bigger
the given organization, the more complicated the principles of
coordination between its separate parts. Usually, only a very
limited circle of people can observe all the processes in their
complexity to effectively regulate them to make an organization
effective, if not simply manageable. Without such leaders, systems
get stuck and go off track. Therefore, instead of barefaced
confrontation, one can do away with one’s adversary by
depriving him of his leader.

In organizations with a more intimate internal relationship, morale

is another important factor which makes the organization
strong. Getting rid of a beloved leader makes morale go down,
making the opponent even less capable of defending himself.

Killing a king, a president or a spiritual leader was always a way for

enemies to deal with each other during wars. One can only imagine
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the potential consequences of the operation to kill three leaders on

the allied side in WWII, had it been successful. Concocted by the
Germans and known as Operation Long Jump, it very nearly
happened in 1943. On the other side, the British decided not to give
the final go-ahead to neutralize Hitler in a carefully planned sniper
operation (Operation Foxley) in 1944, as the war was going to end
and killing Hitler would give the opportunity of victimization and
canonization of his image in Germans’ eyes, invigorating resistance.
As we can see, sometimes ‘capturing’ the leader may consist of
letting or even instigating a once formidable head on the opposite
site to follow his self-defeating way.
In German it was called Operation Rösselsprung, which translates to “Long Jump.” Its goal was to kill
or kidnap the Allies’ “Big Three” leaders––Soviet Premier Josef Stalin, British Prime Minister
Winston S. Churchill, and American President Franklin D. Roosevelt—when they met in Tehran,
Iran, in November 1943. That the plan did not succeed is attributable to smart intelligence work, a
drunken disclosure, and a bit of good luck.

Perhaps no operation was more audacious or had greater consequences to the war’s outcome if it had
succeeded than Long Jump. Former Soviet Lieutenant General and KGB intelligence officer Vadim
Kirpichenko said, “The first secret report that this act was being planned came from Soviet
intelligence officer Nikolai Kuznetsov, who learnt about it during a conversation with SS-
Sturmbannführer Ulrich von Ortel. Ortel was the chief of the sabotage group in Copenhagen, which
was preparing the operation. While drunk, the senior German counterintelligence officer blurted out
that preparations were underway to assassinate the Big Three. Later the Soviet Union and Britain
discovered other facts confirming that preparations had been made to assassinate Stalin, Churchill,
and Roosevelt.

The assassination was scheduled to take place in Tehran, the capital of Iran, after the three Allied
leaders announced plans to meet there to hammer out the final strategy for the war against Nazi
Germany and its Axis allies. Stalin, whose nation was then still bearing the brunt of the German
onslaught, also wanted to know how and when Britain and the United States would open a second
front in Western Europe (Churchill was still dead set against a direct assault on the continent, fearing
it would lead to catastrophe). The momentous meeting, dubbed Eureka, would be held at the Soviet
embassy in Tehran between November 28 and December 1, 1943

In 1944 the SOE (Special Operations Executive) drew up various plans to kill Hitler. The
proposed assassination plans, code-named Operation Foxley, were not attempted in
the end. The most likely timing for the operation would have been during one of Hitler’s
visits to the Berghof, his residence in the Bravarian Alps near Berchtesgaden, Germany.
hese plans were released to the public in July 1998 and at the time they caused world
media interest
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In business, sometimes instead of conspiring against the

organization as a whole, one can plan against a single decision-
maker. I used to know a Chinese company who offered a stake in a
profitable parallel business venture to the leadership of its biggest
customer. By doing so, the Chinese company firmly tied its
customer into its main business. The customer’s employees had to
factor into their decisions the close business relationship of the two
entities.

19th Stratagem of 36：Remove the

Firewood from Under the Cauldron
strong opponent, identify his source
When meeting a
of power and work to deprive him of this
source.
In many historical cases of warfare, this proverb is related to
deprivation of military supplies that leads to the starvation and
disorganization of armies. One such case describes a clash
between imperial general Zhou Yafu of Han dynasty with
rebellious Wu Wang and Liu Wei and other seven vassals, who
launched an assault against Liang state, loyal to Han. The Han
court appointed general Zhou Yafu to help Liang to
annihilate the rebellious force. Instead of direct
confrontation, Zhou Yafu decided to exhaust the enemy by
cutting off grain supplies. Starvation greatly undermined the morale
of the rebellious army. When Zhou Yafu saw
the time had
come, he mobilized the troops and suddenly launched a storming
attack. The rebels were defeated and fled. The Lian crisis was
relievedS
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People usually focus attention on displays of power rather than

on their source. Whereas the source of power may be the key to
the successful resistance to power. It is unwise to engage a
superior opponent in an open fight. Instead, plotting against
whatever brings or maintains his force may be the best option.

In warfare, the ‘firewood’ is usually soldiers’ morale and military

supplies. Depriving an enemy force of any of these sources
could mean a decisive advantage. During the Mongols’ invasion
of Europe in the 13th century, in the third generation of conquests
after Genghis Khan, the conquerors moved as deep into the
European continent as Austria and would most likely have
devastated the whole Holy Roman Empire, if not for the death of
the Mongol leader, Ögedei Khan. During this campaign, the
Mongolians famously used a ploy against the Hungarians to lower
their morale, spreading a decree on the termination of resistance on
behalf of Hungarian King Bela IV. For this purpose, the Mongols
used copies, sealed with the king’s royal seal, captured in one of the
battles. The Mongols sent copies of the decree to different parts of
Hungary.

In business, utilization of stratagem Remove the Firewood from

Under the Cauldron can be exemplified by the deliberate attack on
the opponent’s strategic advantage. Companies thrive for different
reasons. Some have strong teams, in which case competitors may
decide to poach employees. Others may have good suppliers, in
which case competitors may try to remove a successful company
out from cooperation with the supplier. The third sort of company
possesses know-how in technology or processes; their
competitors try to obtain the knowledge through reverse
engineering, the expertise of former employees,
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20th Stratagem of 36：Fish in

Troubled Waters
Deliberately create confusion and distraction so as to reap the
benefits for yourself without your opponent taking notice

This stratagem resembles the 5th Stratagem of 36 – Loot the

Burning House. The only difference is in the active position
towards chaos. Looting the Burning House suggests using
unavoidable circumstances to one’s benefit, while Fishing In
Troubled Waters implies creating circumstances or ‘troubled
water’ to make the ‘fish’ confused and blindly swim into
fisherman’s hands. One can use the stratagem to protect
oneself from an opponent who feels uncomfortable in such an
environment. The other use of the stratagem is to increase
one’s influence and credibility, as in times of uncertainty people
look to others for guidance.

In warfare, the creation of confusion and chaos is a common

trick of gaining an advantage. Interesting is the case of the battle
of Pelusium between Persia and Egypt in the 6th century B.C.E.
This case is described by Macedonian writer Polyaenus in his work
Stratagems. The Persian King Cambyses II, who besieged the
Egyptian city, was very knowledgeable of Egyptian culture and
devised a cunning plan to confuse the enemy. When the Persian
army started advancing on the city, astounded Egyptians saw
myriads of cats marching in front of the Persian army. Persian
soldiers had made use of the cult of Bastet, goddess of home and
fertility, traditionally described as a woman with the head of a cat.
The cult of Bastet was very highly regarded among Egyptians; death
was the penalty for killing Bastet’s incarnations. Struck with awe,
the Egyptians surrendered their positions.
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21th Stratagem of 36：Slough Off

the Cicada's Shell
Deceive your opponent into believing you are still and predictable,
while in reality take a serious action to slip out of the predicament.
Appear to the enemy the way you want him to perceive you, make
your real goals impenetrable.

In a similar way as a previous stratagem, Fish In Troubled Waters,

the stratagem Slough Off the Cicada's Shell is based on the
observation of the natural phenomenon of a hatching cicada which
rarely can be seen after it left the shell due to its protective colours.
One may hear its metallic singing and observe its empty shell – but
can rarely catch it after it has left its casing.

The stratagem Slough Off the Cicada's Shell implies the use of
a dummy or illusion. It can be as simple as words of
conviction that something is happening or may be presented as an
entire ‘theatrical performance’ to fool the opponent

The stratagem is somewhat repetitive of the 11th

stratagem Sacrifice a Plum Tree to Save a Peach Tree, with the
only difference of nature of the action. In one case it is defensive,
but in another case it is offensive.

One of the most remarkable cases of implementing Slough Off The

Cicada's Shell stratagem would be the story from the series of the
historical narratives of the chronicler Si Maqian of Liu Bang, the
future founder of the Han Dynasty (206 B.C.E. – 220 C.E.),
escaping what looked inevitable capturing by his most fearsome
rival Xiang Yu, who besieged Liu Bang in the poorly garrisoned
and fortified city of Xiangyang . Having no other options, Liu Bang
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was saved by one of his trusted lieutenants, who offered his life by
pretending to be the surrendering king, while Liu Bang was fleeing
the city with several dozen loyal men. The lieutenant, named Ji Xin,
led 2,000 civilians disguised as soldiers out of the city walls to lay
down arms in front of celebrating troops of Xiang Yu. As the
guards were let down, nobody took notice of a small escaping
group. Liu Bang was saved and eventually came to power and
established a new dynasty.

In business, a way out of the crisis would be

through restructuring and reorganization. Great companies
disappear if they are unable to change. Those who manage to find
new areas of development may successfully abandon practices
associated with former successes and find new drivers for growth. A
rightly defined company mission may help an organization to stay
relevant but nevertheless, extend the range of operation. For
instance, IBM followed Slough Off the Cicada's Shell by
eliminating its PC and other hardware businesses, focusing on IT
expertise and consulting and computing services, helping the
company to emerge out of the woods in the early 2000s.

In negotiations, feigning retreats to buy time or regroup is

common. Chinese negotiators usually follow the stratagem by
accepting the inevitable, but rarely take it as irrevocable.
According to my observation, Chinese opponents
regard confrontations as never-ending games wherein ups and
downs are inevitable. By accepting defeat one can also reassess
and fix the loss (sacrifice the shell), and make oneself free to
establish a new strategy for a future comeback. A continuous
confrontation may be devastating and lead to a worse outcome.

22th Stratagem of 36：Shut the Door to

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Catch the Thief

Lead an opponent deep into your terrain to cut his supply lines.
Create a situation where the retreat is harder than advancing –
but the advance turns out to be a dead-end.

Envelopment or blockading of a weaker opponent to crush him is a

common practice in warfare. Confinement of a stronger enemy
requires craft and mastery. Such a strategy may lead to what
Chinese people call 引 狼入室 / yǐn láng rù shì / or ushering the
wolf into the house. Nevertheless, if on unknown and hostile
terrain, even a fearsome opponent can be defeated.

In the history of warfare, the military campaign of Napoleon in

Russia presents an example Shutting the Door to Catch the Thief.
With more than 600,000 men, Napoleon intended to overrun
the Russian Empire within weeks. The French emperor was used to
the traditional warfare of his time. Once invading any European
state, the enemy would meet Napoleon in an open fight and would
be defeated. The Russians decided to avoid fighting, to lure the
French army deep into their country. Napoleon advanced all the way
to Moskow and eventually took it. This is where the ‘gates’ finally
closed for the French. The Russians set wooden buildings on fire,
leaving French with a burnt city. Napoleon fruitlessly waited in the
ruined city for the Russian Tsar to surrender. It never happened.
Eventually, the Russian winter arrived and there was no place for
French to hide for winter quarters. Supplies were interrupted. The
French fled, leaving their wounded and dead behind, pursued and
attacked by Russian troops. Only 27,000 men from what was
originally known as the Grande Armée returned from the Russian
campaign.
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In the business world, enforced contractual commitments and

obligations may push companies into a corner. It is not
uncommon for a company to opportunistically agree on a client’s
terms – only to find these were designed to be violated. As a result,
a company may end up accumulating fines and penalties instead of
profit. Another example comes from a real business case I
encountered. Two companies entered into an agreement for yearly
supplies expressed in a certain volume but without specifying
monthly purchase limits. As a result, the customer ordered a
disproportionate part of the yearly order within the first several
months of cooperation, making the vendor fail on supply and
providing the customer with an opportunity to levy penalties.

Finally, I also found the stratagem of Shutting Door To Catch The

Thief to be widely used in negotiations in China. If one is careless
enough to vaguely suggest a possibility of something that suits
the agenda of one’s counterpart, one will be carefully steered
further to elaborate on such possibility and finally held
accountable for it. Even if no promises were made, the words
gained weight when they are pronounced, and they will be used
against a fool who could not restrain his tongue.

23rd Stratagem of 36：Befriend a

Distant Enemy to Attack One Nearby
One can ignore or even ally with a distant enemy in order to get
rid of the closest and most dangerous opponent

The expression 远交近攻 / yuǎn jiāo jìn gong / was first used in
‘The Intrigues of the Warring States’, a collection of historical
records from the Warring States period (403-221 B.C.E.),
compiled by Han dynasty scholar Liu Xiang. Liu Xiang used the
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expression in connection with the foreign policy of

the Kingdom of Qin. The Warring States period is known as a
time of power games between the seven states: Qin, Qi, Chu,
Yan, Zhao, Wei and Han. Qin, an underdog in this struggle,
managed to achieve great success and eventually became the
leading force of all seven kingdoms. Guided by a prudent policy
of minister Fan Ju, a strong proponent of Befriend a Distant
Enemy to Attack One Nearby strategy, Qin made alliances with
distant Qi and Chu to defeat neighbouring Han and Wei. Later,
when the closest enemies were defeated, Qin engaged in war
with its former allies.

The commentary to the original text reads

... when obstructed by conditions and prohibited by circumstances,

take advantage of what is close and fence yourself off from distant
threats ...

In situations with multiple fronts, one will inevitably take a

beating. When fighting a distant enemy on what looks like a single
front, one cannot be sure that one’s back is safe. Therefore, a wise
man always concentrates on the closest or most dangerous
enemy before confronting other potential
adversaries. Moreover, by the extensive use of temporary alliances,
one creates strategic superiority to achieve tactical advantage.

The history of the wars presents some unlikely cases of utilization of

the principle Befriend a Distant Enemy. A very prolonged strategic
alliance, that lasted more than two hundred years, between two of
the least expected partners – Catholic France and the Islamic
Ottoman Empire – against their common enemy, the Austro-
Hungarian Empire, created a shift in the foreign policy mentality of
European states. This alliance, established in 1536 C.E., less than
three hundred years after the last crusade, stirred outrage in Europe
as it was the first time in history that one Christian state united with
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Muslim power to fight another Christian state. Nevertheless, this

relationship turned out to be so beneficial that it forged a very strong
bond that was broken only after Napoleon’s opportunistic move to
conquer Egypt.

In business, the ‘enemy’ to fight with may be the industry

environment, customers, competitors or other stakeholders.
Strategic alliances are usually a way to deal with these ‘enemies’.
Companies create alliances for different reasons – to enhance
competitiveness and economies of scale, to overcome
competition, to share business risks or to attract more
resources. Following the approach of the stratagem Befriend a
Distant Enemy to Attack One Nearby, companies should verify
their most worrisome ‘enemies’ to decide on potential alliances. It
may be that in a harsh market situation, instead of continuously
fighting competitors, one should seek opportunities for cooperation
with them and benefit from taking a univocal approach to market
challenges.

Business ‘handbooks’ often teach us to view all competition with a

negative eye. This sometimes creates disruptive behaviour,
expressed in a price war of all-against-all or in the neglecting of a
common enemy. In fact, fierce rivals may have common ground in a
different situation. Competing globally while allying locally is a great
example of such a strategy.

I was advising a client in my current position in @Intralink on the

best strategy towards China. My research indicated that the best
approach was through an alliance with the client’s international
competitor. This unlikely partnership seemed justifiable, as the client
had a unique product with a special interest for the Chinese market,
while its competitor had all the necessary infrastructure in China. In
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the face of a common ‘enemy’, the market, alliance with a distant

enemy could deliver the necessary synergy for success.

In negotiations, Chinese companies may apply the principle of this

stratagem by deliberately dragging opponents’ middle-rank
negotiators into alliances. If you are a company’s representative, but
not a business owner, your opponent may try to draw you over to
his side in a ‘fight’. In the 17th stratagem, Exchange a Brick for a
Jade, we already discussed how ‘bricks’ in the form of presents and
tokens of appreciation to a company representative can be used in
exchange for a ‘jade’ – the relationship between the companies. In
stratagem 23 there are no ‘bricks’; your opponent engages his prey
emotionally by creating a sense of good fellowship and mutual
understanding. I witnessed examples of company representatives
who actually genuinely, without any personal gain, took a Chinese
counterpart’s side in conflicts with their companies. In such
cases, reps spent time with their counterparts, learned about their
problems and eventually subconsciously became their allies. Such
allegiances do not necessarily mean strong bonds. Reps typically
remain loyal to their companies. Yet the strategy may work
occasionally and so it is always worth a shot. I personally have
found this stratagem to be widely in use

24th Stratagem of 36：Borrow A Route

To Conquer Guo
Seduce one’s enemy to make him well disposed towards aggression
against a third-party. After trouncing one enemy, turn on the one
who helped you. This time he will not have an advantage of seeking
help elsewhere and must confront you all alone.
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The describes a story from the Spring and Autumn Period (770-
476 B.C.E.) when the Kingdom of Jin conquered the two smaller
kingdoms of Yu and Guo.

Despite being a fearsome force, Jin would struggle in a fight with

two smaller states. Instead, the king of Jin was advised to conspire
against a potential alliance of Yu and Guo, by expressing kinship
to Yu. The king of Jin made luxurious presents to the lord of Yu
before asking his permission to pass Yu’s territory to engage
Guo. Besotted with the prospect of an alliance with such a strong
state, the Lord of Yu permitted the passing. Guo was crushed, but it
was a death sentence for Yu as well. After conquering Guo, the next
natural prey was Yu.

In cases of Borrow A Route To Conquer Guo we face a two-stage

stratagem. The idea is to achieve a feasible goal by using the
same opponent, who first plays the role of a tool against a third
party and then falls a victim to the second stage of the
scheme. The opponent should fully comprehend the first goal and
pursue his own interest in the first stage; the second stage should
be well disguised from his eyes.

In the 16th century C.E. Imperial Japan launched an offensive

against Ming China. Japan demanded the right to pass through
Korean territory to attack China. The ruling Joseon dynasty, being
well aware of the consequences of such trade-off, declined. This
brought up what is known as the Imjin War, which by some
estimates took a million lives among military and civilians from the
Korean side. Nevertheless, Japan faced a coordinated resistance
from the two aligned states and eventually sustained a defeat. This
conflict saw the rise to prominence of one of the most remarkable
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figures in maritime warfare, Admiral Yi Sun-Shin, who is also

considered to be one of the greatest heroes in Korean history. This
extraordinary man, without prior naval training, took charge of a
Korean fleet and not only never lost a fight but did not even lose a
single ship through the whole war. In the most stunning victory
against more than 130 enemy ships Yi Sun-Shin, with only 13 vessels,
managed to sink 30 Japanese ships. Admiral Yu Sun-Shin died as a
hero in his last battle, but his heroic deeds greatly contributed to
Korean victory. Japan failed to bring to life the Borrow The Route
To Conquer Guo stratagem.

Doing business in China, I witnessed examples of the utilization of

the 24th stratagem in interactions between foreign brands and their
local distributors. At some point, an international brand may choose
a distributor to penetrate the market. If the market entry is
successful, the brand may decide to localize operations and cut the
distributor off from the business that this distributor effectively
created.

Another example was partly described in the business case to

stratagem 3, Kill With A Borrowed Sword, when an international
client forms an alliance with Chinese suppliers, to supersede his
competitors from the same supplier. If after this goal is achieved
and the company subsequently turns against its supplier, demining
price reductions as the possessor of the main purchasing power,
this turns deceit into stratagem 24.

Replace the Beams With Rotten

Timbers
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Take control or damage sustaining structure of the

enemy’s force and then replace it with whatever suits your
goals without your enemy paying attention. Activate this hidden
weapon against your enemy in a proper time.

Stratagem 25 is effectively a strategy for turning the

enemy’s strength into their biggest weakness. If rightly applied,
there is nothing like corroding an enemy’s favourite
weapon. By changing the true sense while keeping
f
the acade unchanged, one can make the opponent stick to a
practice that has already become detrimental and self-destructive.

In many regions of the world, culture is a very effective weapon

against enemies. Chinese civilization has managed to survive for five
thousand years mainly due to the extreme vitality of its culture.
Whoever conquered China, whether it was Mongols or Manchus,
eventually bent their knees in admiration of its grandeur.
Usually, culture is used deliberately as a weapon. In changing
cultural codes via the infiltration of people, customs or language, one
nation can undermine an opponent’s vitality and power of resistance.
As a result, agents of influence, useful idiots and plain traitors
become those rotten timbers that foster the eventual submission
of a weaker side by the side that has become more powerful as a
result of such shifts in the distribution of power.

In business, poking fun at competitors may be one of the possible

implementations of the stratagem Replace The Beams With
Rotten Timbers. For instance, Samsung famously mocked the craze
around new iPhone releases, showing how it demonstrated people
would stand in lines for ‘just nine hours’ or that they were ‘too
creative’ to buy any other devices. A signature culture cast in such
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an unsavoury light can certainly turn perceptions upside

down. What looked fashionable or exclusive is demonstrated to
be diametrically the opposite. Slowly, beams may start rotting in
some customers’ minds.

Exposure of the downside of an opponent’s strengths to the

customers is an effective tool in negotiations as well. For instance, if
one supplier is very big, a contending supplier of smaller size,
knowing of the existence of the former, may choose to persuade a
customer that the size is exactly what makes the business sluggish,
inflexible and inattentive of customers’ demands. Knowing
opponents’ strengths and conspiring against them, presenting them
as weaknesses in disguise is a good persuasive method for a
negotiation process that my Chinese counterparts regularly used.

26th Stratagem of 36：Point at the

Mulberry But Curse the Scholar Tree
Make the object of your criticism someone but also make sure
the message is transferred to someone else who is the real
receiver of the warning or message

The symbolism of the proverb is easy to comprehend when

considering the role of the Scholar Tree in Chinese culture.
The scholar tree was originally related to nobility. Some
Chinese words using the character ‘ 槐 ’ relate to the
government, such as ‘ 槐 鼎 ’ – three top officials of the
state, ‘ 槐 卿 ’ – the three councillors of state and the nine
ministers, ‘槐宸’ – imperial palace. Mulberry, on the other
hand, is a common tree that grows everywhere.
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Sometimes a direct clash with an opponent may seem unnecessary

due to the potentially unfavourable consequences. The scapegoat
will deliver the message. Stratagem 26 is an informational
stratagem, the main task of which is to express intimidation
using indirect methods.

In armies, demonstrational punishment to maintain order is a widely

used practice. This can be considered as a variation of the stratagem

In 1757, Admiral Byng of the Royal Navy of the British Empire was
executed for failing to "do his utmost" during the Battle of
Minorca between French and British fleets that lead to British loss
of control over the Mediterranean island. The highly dubious
execution decision was later described by Voltaire as “pour
encourager les autres” in Candide

Indirect actions in business may have a far-going influence on

industries. The common approach in the utilization of Point At The
Mulberry But Curse The Scholar Tree almost everywhere in the
world is an appeal to consumers’ ‘patriotism’ when choosing
products. It is not uncommon for local companies, unable to
compete with cheaper or better equivalents from the international
market, to start developing anti-import sentiment among the broader
public. The ongoing international campaign against Huawei is a
perfect example – fingers are pointed at security concerns.

My experience of negotiations in China suggests the importance of

the implementation of this stratagem. Usually, the opposite side
accepts indirect condemnations more readily as it helps saving
face. Finding a proper ‘scapegoat’, be it an unfortunate concourse
of circumstances or excessive blunder by inferiors, saves your
opponent from direct criticism which can sometimes be hard to
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accept. If the opponent is a responsible partner, making the point

should be enough.

However, it is utterly important to play your role in a way that leaves

opponent no doubt about your full awareness of the real state of
play, otherwise the ‘scholar tree’ may not learn the lesson at hand.

27th Stratagem of 36：Play Dumb

While Remaining Smart
Present yourself as plain and easy to read. Conceal your true
strengths and exaggerate weaknesses. Wait until the enemy drops
their guard to make a decisive move.

One of the famous stories of utilization of the stratagem relates to

the confrontation between Sun Bin and Pang Juan, generals
during the Warring Kingdom Period (457-221 B.C.E.). This
story has already permeated several
stratagems and will be used this time as well.
As we already know, Pang Juan and Sun Bin both served
as military advisors to the court of the Kingdom of Wei.
They learned martial arts from the same teacher and were
inseparable in their young years. But later, Pang Juan grew envious
n
of Sun Bin’s virtues and had him slandered and tortured. I
order to save his life, Sun Bin had to feign
madness. Conspicuous Pang Juan tormented
Sun Bin by placing him in the hog-pen, where
Sun Bin ‘continued going off his champ,
refusing to take food and eating hogs’
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faeces’. Such frantic behaviour becalmed Pang Juan who let his
guard down, allowing Sun Bin flee to the Kingdom of Qi, where he
found a retreat, came into the favour of the king and helped Qi to
defeat Wei.

t’s better to pretend that you don’t know anything and don’t want to
do anything than to pretend to possess knowledge and act recklessly.

The 27th stratagem can work for a rising star to grow into
power unnoticed but can also be utilized by an established
hegemon to uncover his enemies.

During WWI Britain's Royal Navy made extensive use of Q-ships to

combat German submarines. The German submarines had become
a real curse for the civil fleet. In order to lure enemy submarines into
a trap, Britain started to disguise military vessels to look like civilian
sailing tramp steamers. These ships became known as Q-ships,
whose main goal was luring a submarine to the surface to sink it
with the sub's deck guns, saving torpedoes for military targets.
Once the U-boat had surfaced, the Q-ship would unload its guns to
sink the sub.

In business, we can consider going against the customary way of

conduct to be a form of stratagem Play Dumb While Remaining
Smart. The competition usually does not respond to the actions that
fall out of the range of normality. This is the way Richard
Branson makes business. His record company takes on board
bands that no other record labels are willing to sign, such as
the Sex Pistols. His unorthodox approach in airspace transportation
helped Virgin Airlines to carve a niche in the established industry.

In negotiations, a Chinese counterpart usually likes to play the

humble card. When meeting a more superior opponent, one
praises one’s opponent’s virtues and strengths, usually while
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downplaying his own best qualities. Often it comes as a complete

surprise when the opponent side suddenly realizes that his
counterpart has just built a new factory or drives a limited edition
Bentley.

28th Stratagem of 36：Pull Down

the Ladder After the Ascent
Entice your enemy to enter deep into your line then surround
him and cut off all ways of retreat.

If one possesses a decisive advantage, it is important to create the

circumstances necessary not only to use it once but also fully to
Sometimes, the deception may fall
enjoy its fruits.
flat just because the opponent senses the
danger and retreats. So if there is really something that
predicts inevitable victory, one has to be very careful of when to
expose it.

The Korean strategists used the principle of the stratagem Pull

Down The Ladder After The Ascent during the battle of Salsu, one of
the most extraordinary battles in world history. This encounter (612
C
C.E.) resulted in a complete defeat of the hinese Sui dynasty by
the Korean kingdom of Goguryeo. Chinese forces originally
comprised a formidable force of 300,000 men; these were chasing
Little did the Chinese
Korean forces deep into Goguryeo.
generals know that the retreat was feigned
and that they were being lured into a trap. The
Korean army led the Chinese into the high bed of the Salsu River.
The Koreans erected a dam to cut off the flow of the river. When the
unsuspecting Chinese found themselves on the high bed the dam
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was opened, causing an onslaught of water that drowned

thousands of soldiers. The surviving Chinese soldiers were finished
by the Korean forces.. The ‘ladder’ was carefully pulled down by the
Koreans, leaving no way out for the isolated Chinese army. Only
2,700 survived out of 300,000.

In business, there are plentiful examples of the exploitation of the

stratagem Pull Down The Ladder After The Ascent. One of my
friends shared a story of deceit in one Eastern European country, in
an industry heavily reliant on imports from China. One of the
importers patented an essential spare part common to all product
categories. As a result, most of his competitors found themselves in a
very interesting situation when their habitual product lines infringed
someone’s intellectual property

Working in China, I was subjected to this stratagem as I struggled to

enforce contract obligations on my partners. If a partner was skilful
enough, they could not only pin you to the wall but also present it
like a sinister concourse of circumstances beyond their control, while
imitating the bustling activity of someone trying to ‘resolve’ the issue
so that you have nothing to reproach him for. This kind of person
could place you in a trap that is hard to emerge from.

29th Stratagem of 36：Pull Down

the Ladder After the Ascent
Pretend to be more powerful than you are to keep a stronger
enemy at bay.

The expression literally means the tree blossoms and has no

historical references; it is first encountered in the 36
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Stratagems treatise. The meaning of the stratagem would be

impossible to understand without the commentary on the 29th
stratagem, which reads:

Take advantage from others to make your

lineup look strong. Wild geese’s flock size in
the air can be measured by the width of their
wings.
The expression used for the stratagem is believed to be related to
the proverb 铁树开花 /tiě shù kāi huā/ which literally means ‘the
iron tree blossoms’ or ‘hardly possible thing’. Therefore, we
conclude that the writer of the treatise encourages what seems an
unlikely move: The weaker side performing a position of
strength to puzzle the opponent.

Power is not only an act but also a stance. We usually assess the
power by a variety of signs. Subjective signs often have the same
weight as objective ones. If an opponent manages to act as if he
has much more force than he has, we tend to grant him the
benefit of the doubt.

For an obvious reason of associated risks accompanied by the

exposure of double gaming, one should revert to this stratagem
in deadlock situations. Strangely, it is also a rule of thumb to
deploy the stratagem in a deadlock situation, if one has nothing
to lose – but everything to win if the strategy works. Finally, with
certain reservations, the stratagem may be applied for offensive
use.

In warfare, we encounter examples of winning battles against

overwhelming odds by utilization of the stratagem Put Fake
Blossom to the Dead Tree. In fact, sometimes these were not
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defensive but rather offensive campaigns, whereby smaller armies

made stronger enemies surrender. During the Ango-American
war of 1812, the American General William Hull famously
surrendered Fort Detroit to a joint British-native Indian force
without a fight, believing that he was greatly outnumbered by
British regular troops and being utterly terrified by the prospects of
facing of hordes of “uncontrollable” Indians. In a brief
correspondence, a British general made no bones that he would not
be able to restrain the “blood-thirsty” Tecumseh tribe should they
manage to charge through enemy defences. As a result, the fort
defended by more than 2000 men surrendered to an army of
less than 1400.

In business, ‘feigning blossom’ may invite punishment, especially

when brands make ungrounded claims about their products or
services in the public domain. However, companies may still
manage to bolster their credibility by embellishing their brand
history and the size of their influence. This strategy is also one of
many ways that companies may aggressively manipulate the jobs
marketplace; by exaggerating their current HR needs, companies
can give the impression that they are rapidly growing, while
acquiring valuable information, perhaps from former employees of
competitors.

Sometimes, such a simple thing as a brand name can create positive

associations and help a business to grow. This was the case
for Carlo Pazolini, a Russian-based footwear company. Founded in
1990 in Moscow, the company actively promoted its brand in the
markets of the former Soviet Union. Although, they never
concealed the fact that they were a Russian company, the name
and the overall image created strong associations with luxurious
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Italian brands. In reality, Carlo Pazolini was mainly produced in

Russia, and later in China.

Visiting manufacturers in China, I was sometimes bewildered to find

something very different than the factory featured by the
manufacturer in his catalogue. The usual explanation for the
discrepancy between the catalogue image and reality was that the
image was of a new factory that “is currently under construction”. As
we can see, unlike the inferences taken from stratagem 27, where
we concluded that Chinese negotiators are fond of playing the
humble card, the abovementioned example demonstrates that the
stance can be quite different when it suits the case. There is no
point of being humble when you are hunting for new business
opportunities. Fortune favours the bold, not humble, in this
case.

30th Stratagem of 36：Make the

Host and the Guest Exchange Places
t
Accept the inferior position oday to infiltrate your adversary and
take him t
down omorrow. Gradually make your
d
opponent ependent on you without him realizing that the roles
have been switched and that the host is a guest in his own house.

in the right time get a foot into your adversary’s end, and take
control of most essential tools; follow in order and advance step by
step.

Usually, people are concerned about present perils and rarely

take precautions against unlikely risks from an uncertain
future. The current problem commonly seems the most daunting.
Therefore, a cunning trickster who offers an immediate solution
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to the problem of the day can win trust and wriggle into the
favour of his victim. Little does the victim know that the solution is
temporary. The one who employs the stratagem Make the Host
and the Guest Exchange Places always makes sure to cure only
symptoms but never a disease. The disease is what makes the
host dependant on the guest, sometimes so completely that the
host and the guest switch their roles.

The stratagem is usually applied against a strong adversary who is

too dangerous to confront directly.

A military class of medieval Islamic countries, known as

the Mamelukes, was traditionally comprised of young slaves from
Turkic, Slavic and Caucasian people, who were raised within
militarism and Islam from a very early age. The Mamelukes were
employed by the Kurdish dynasty of Ayyubid, founded
by Saladin, who ruled Egypt between the XII-XII centuries AD.
Ethnically diverse, the Mamelukes were very united as a knightly
military caste. Originally introduced as auxiliary forces to strengthen
the court, the Mamelukes eventually became powerful enough to
overthrow Ayyubid and establish Mameluke rule over Egypt and Syria
that lasted for almost 300 years.

In business, we have witnessed how this stratagem was employed in

the automotive field in China. International automotive
OEMs, originally the hosts of the industry, were forced to form
JVs with local businesses as an entrance ticket to the local market
and as a mean of avoiding protective duties for the imported
vehicles. In a matter of little more than a decade, Chinese
counterparts, originally guests in the industry, have become
hosts, at least in the China market.
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James Thurber
"The Owl Who Was God"
Once upon a starless midnight there was an owl who sat on the
branch of an oak tree. Two ground moles tried to slip quietly by,
unnoticed. "You!" said the owl. "Who?" they quavered, in fear and
astonishment, for they could not believe it was possible for anyone
to see them in that thick darkness. "You two!" said the owl. The
moles hurried away and told the other creatures of the field and
forest that the owl was the greatest and wisest of all animals
because he could see in the dark and because he could answer any
question. "I WIll see about that, "said a secretary bird, and he called
on the owl one night when it was again very dark. "How many
claws am I holding up?" said the secretary bird. "Two," said the owl,
and that was right. "Can you give me another expression for �that
is to say� or �namely�?" asked the secretary bird. "To wit," said
the owl. "Why does the lover call on his love?" "To woo," said the
owl.

The secretary bird hastened back to the other creatures and

reported that the owl indeed was the greatest and wisest animal in
the world because he could see in the dark and because he could
answer any question. "Can he see in the daytime, too?" asked a red
fox? "Yes," answered a dormouse and a French poodle. "Can he
see in the daytime, too?" All the other creatures laughed loudly at
this silly question, and they set upon the red fox and his friends and
drove them out of the region. They sent a messenger to the owl
and asked him to be their leader.

When the owl appeared among the animals it was high noon and
the sun was shining brightly. He walked very slowly, which gave
him an appearance of great dignity, and he peered about him with
large, staring eyes, which gave him an air of tremendous
importance. "He Is God!" screamed a Plymouth rock hen. And the
others took up the cry "He Is God!" So they followed him wherever
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he went and when he bumped into things they began to bump into
things, too. Finally he came to a concrete highway and he started
up the middle of it and all the other creatures followed him.
Presently a hawk, who was acting as outrider, observed a truck
coming toward them at fifty miles an hour, and he reported to the
secretary bird and the secretary bird reported to the owl. "Theres
danger ahead," said the secretary bird. "To wit?" said the owl. The
secretary bird told him. "Arent you afraid?" he asked. "Who?" said
the owl calmly, for he could not see the truck. "He Is God!" cried all
the creatures again, and they were still crying "He Is God" when the
truck hit them and ran them down. Some of the animals were
merely injured, but most of them, including the owl, were killed.

Moral: You can fool too many of the

people too much of the time.

The Moth and the Star and

A young and impressionable moth once set his heart on a certain
star. He told his mother about this and she counseled him to set his
heart on a bridge lamp instead. “Stars aren’t the thing to hang
around,” she said; “lamps are the thing to hang around.” “You get
somewhere that way,” said the moth’s father. “You don’t get
anywhere chasing stars.” But the moth would not heed the words of
either parent. Every evening at dusk when the star came out he
would start flying toward it and every morning at dawn he would
crawl back home worn out with his vain endeavor. One day his
father said to him, “You haven’t burned a wing in months, boy, and
it looks to me as if you were never going to. All your brothers have
been badly burned flying around street lamps and all your sisters
have been terribly singed flying around house lamps. Come on,
now, get out of here and get yourself scorched! A big strapping
moth like you without a mark on him!”
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The moth left his father’s house, but he would not fly around street
lamps and he would not fly around house lamps. He went right on
trying to reach the star, which was four and one-third light years, or
twenty-five trillion miles, away. The moth thought it was just caught
up in the top branches of an elm. He never did reach the star, but
he went right on trying, night after night, and when he was a very,
very old moth he began to think that he really had reached the star
and he went around saying so. This gave him a deep and lasting
pleasure, and he lived to a great old age. His parents and his
brothers and his sisters had all been burned to death when they
were quite young.

Moral: Who flies afar from the sphere of our sorrow is

here today and here tomorrow

What is Power of Suggestion?

What is the power of suggestion? The power of suggestion is when
an individual has an idea conveyed to them, and that idea, in turn,
becomes reality. This is instrumental in psychology because it is
how psychologists help a patient modify their behavior. The mental
health professional will propose a particular solution or behavior
modification for the client to adopt.
The science behind this phenomenon lies in response expectancies.
This is how an individual anticipates a response to a particular
scenario. If a psychologist or another person has alluded that a
particular response will occur to a situation, the person is more apt
to believe that response will occur. When a person anticipates that a
particular situation outcome will occur, their behavior will
automatically work to bring about that suggested response. This is
the power of suggestion.
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For example, Janelle has to run her first marathon tomorrow, and
she's unsure if she's up for the challenge. She's been training, but
not that diligently. Her distance and time haven't been in line to
prepare her for the challenge that the marathon presents tomorrow.
Janelle calls her mom for support. Her mom tells her that she's a
capable runner that has run plenty of half marathons before and
that she will finish the race tomorrow. Janelle goes into the race
confident and finishes in plenty of time. Janelle had trepidation
about running the race and finishing, but her mom suggested she
would excel. The next day, Janelle was automatically able to
complete the race, despite never having hit the correct time and
length before.

If a person believes in an expected outcome, they are more

likely to automatically achieve that outcome. This is the
basis for the power of suggestibility. This phenomenon is
used in psychology and healthcare to greatly improve the
lives of people.

Suggestibility

Suggestibility is a person's ability to modify their behavior

based on the proposal of another. Each person has a
different level of suggestibility. Individuals with high
suggestibility are more susceptible to changing their
thoughts, feelings, or behaviors based on the counsel of
others

People with low suggestibility are not as easily influenced by

the words of others.
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People with high suggestibility have a hard time recalling

memories, as they can easily get distorted over time due to
outside influence. In addition, they are more susceptible to
bad influences altering their behaviour due to peer
pressure.

Scientists believe that people have higher suggestibility if

they are:

 younger
 more emotional
 have a lower self-esteem
 less skeptic

People with high suggestibility are more likely to alter their

behavior at the advice of others, while people with low
suggestibility are less likely to do so.

Vividness

The vividness of the scenario being presented can increase

the suggestibility of an individual that otherwise has low
suggestibility. This makes them more likely to modify their
behavior. The vividness of the imagery or scenario being
presented to the individual is the richness, details, and
description of the scenario being presented.
The more real and likely the scenario is to the individual, the
more likely they are to modify their behavior and comply
with the power of suggestion. This is a useful tool that can
be applied to people that have low suggestibility.
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For example, Janelle is talking on the phone with her mom

about the race. Her mom goes into vivid detail about Janelle
crossing the finish in time. The crowd is roaring, Janelle's
heart is racing and her feet are pounding the pavement. Her
breathing is rapid and even, and her body is warm.
Her mother using a detailed description of Janelle achieving
her goals is more likely to cause her to automatically achieve
them. The vividness of the imagery will increase the
suggestibility of the individual.

Salience

Salience is the ability of an individual's mind to make one

item distinct from its surroundings. A suggestion that is
important, stimulating to the individual, and contextual is
more likely to strike a chord with an individual than a
suggestion that is not salient. What is salient to one
individual may not be salient to another.
Salience can be applied to a suggestion for an individual that
has low suggestibility to increase the chances of them being
compliant in their behaviour.

THE POWER OF A LIE – TREASRY OF

JEWISH FOLKLORE
In the town of Tarnopol lived a man by the name of Reb
Feivel. One day, as he sat in his house deeply absorbed in
his Talmud, he heard a loud noise outside. When he went to
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the window he saw a lot of little pranksters. “Up to some

new piece of mischief, no doubt,” he thought.

“Children, run quickly to the synagogue,” he cried leaning

out and improvising the first story that occurred to him.
“You’ll see there a sea monster, and what a monster! It’s a
creature with five feet, three eyes, and a beard like that of a
goat, only it’s green!”

And sure enough the children scampered off and Reb Feivel
returned to his studies. He smiled into his beard as he
thought of the trick he had played on those little rascals. It
wasn’t long before his studies were interrupted again this
time by running footsteps. When he went to the window he
saw several Jews running. “Where are you running? He
called out? “To the synagogue!” answered the Jews. “Haven’t
you heard? There’s a sea monster, there’s a creature with
five legs, three eyes and a beard like that of a goat, only it’s
green!” Reb Feivel laughed with glee, thinking of the trick he
had played, and sat down again to his Talmud.

But no sooner had he begun to concentrate when suddenly

he heard a dinning tumult outside. And what did he see? A
great crowd of men, women and children, all running to the
synagogue. “What’s up?” he cried, sticking his head out of
the window. “What a question! Why, don’t you know?” they
answered. “Right in front of the synagogue there is a sea
monster. It’s a creature with five legs, three eyes and a
beard like a goat, only it’s green!”

And as the crowd hurried by, Reb Feivel suddenly noticed

that the Rabbi himself was among them.
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“Lord of the world!” “If the Rabbi himself is running with

them surely there must be something happening. Where
there is smoke, there is fire!

Without further thought Reb Feivel grabbed his hat, left his
house and began running. “Who can tell?” he muttered to
himself

What Is the Pareto Principle

The Pareto Principle, named after economist Vilfredo
Pareto, specifies that 80% of consequences come from 20%
of the causes, asserting an unequal relationship between
inputs and outputs. This principle serves as a general
reminder that the relationship between inputs and outputs
is not balanced. The Pareto Principle is also known as the
Pareto Rule or the 80/20 Rule.

 The Pareto Principle states that 80% of

consequences come from 20% of the causes.1
Colorado Department of Transportation. "Pareto
Analysis."

 The principle, which was derived from the imbalance of

land ownership in Italy, is commonly used to illustrate
the notion that not things are equal, and the minority
owns the majority.
 Unlike other principles, the Pareto Principle is merely
an observation, not law. Although broadly applied, it
does not apply to every scenario.
The original observation of the Pareto Principle was linked to the
relationship between wealth and population. According to what
Pareto observed, 80% of the land in Italy was owned by 20% of the
population. After surveying a number of other countries, he found
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the same applied abroad. For the most part, the Pareto Principle is
an observation that things in life are not always distributed evenly.
ThePareto Principle can be applied in a wide range of areas such as
manufacturing, management, and human resources. For instance,
the efforts of 20% of a corporation's staff could drive 80% of the
firm's profits. The Pareto Principle can be applied especially those
businesses that are client-service based. It has been adopted by a
variety of coaching and customer relationship management (CRM)
software programs.
It can also be applied on a personal level. Time management is the
most common use for the Pareto Principle, as most people tend to
thinly spread out their time instead of focusing on the most
important tasks. In terms of personal time management, 80% of your
work-related output could come from only 20% of your time at work.
Financial advisory businesses commonly use the Pareto Principle to
help manage their clients. The business is dependent on the
advisor’s ability to provide excellent customer service, as its fees rely
on its customers’ satisfaction. However, not every client provides the
same amount of income to the advisor. If an advisory practice has
100 clients, according to the Pareto Principle, 80 percent of the
financial advisor’s revenue should come from the top 20 clients.
These 20 clients have the highest amount of assets and the highest
fees charged.
The Pareto Principle seems simple but is hard to implement for the
typical financial advisor. The principle suggests that since 20 clients
are paying 80 percent of the total fees, they should receive at least
80% of the customer service. Advisors should, therefore, spend most
of their time cultivating the relationships of their top 20 clients.

However, as human nature suggests, this does not happen. Most

advisors tend to spread out their time and services with less regard
to a client’s status. If a client calls and has an issue, the advisor deals
accordingly, regardless of how much income the client actually
brings in to the advisor.
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The principle has also led to advisors focusing on replicating their top
20% of clients, knowing that adding a client of that size immediately
affects the bottom line.