The Art of War: Warrior Rules - winning by comparing positions

In competitive environments, we operate with incomplete information as a matter of course. No battle in history would ever have been fought if people had good information about their relative strengths. Both sides would know before the battle who would win. Battles are fought only because both sides think they can win. Someone is wrong. At the most, only one side can be right. Both sides are often wrong when we consider the cost and value of most battles.

But no one knows who will win in competition. The information any group has is an insignificant portion of the total information in the environment. Getting all the information you need to bake a cake in a controlled environment is relatively easy. Getting all the information you need to sell cakes in the competitive market is much more difficult. There are always too many variables. There are always too many unknowns. Who can know how many people will decide they want to buy a cake today? Many who buy cakes in the afternoon didn't even have that information themselves in the morning.

Competitive environments are also filled with misinformation. Competitors try to mislead each other regarding not only their future plans but their current circumstances. Individuals distort the truth for a variety of reasons. As in a game of poker, any advantage you have is linked to what you know that the other players don't know.

The limitations of information affect a buyer as well as a seller. Internal resources are resources about which we have good information. We do not have good information about external resources, that is, the resources that others have. This makes finding the best product, the lowest-cost supplier, or a reliable service provider a challenge. The volume of unknown information in the external market is always much more than the known information available to any single decision-maker.

In controlled environments, everyone is relatively well informed about what is changing. In larger, more complex, competitive environments, it is infinitely more difficult to keep up with increasingly fast-changing information.

The past does not predict the future in competitive environments. Neither does planning. Conditions are fluid. New alternatives are constantly being offered. Everyone is continuously reacting to the changes around them, creating dynamic situations. Everyone predicts success, but actual results are unpredictable. When people are successful, they think their planning worked. When they fail, they blame their plans. Most fail to see the effects of strategy because they don't understand the differences between strategy and planning.