Counterinsurgency Expert John Nagl, On The Parallels Of Business And War

The following post originally appeared on Forbes | December 8, 2014

War is the business of barbarians – Napoleon Bonaparte

We’ve all heard them before: “business as war” metaphors. While I won’t list any—no doubt you can list a bunch of your own—it is difficult to dispute the (at least) structural similarities between the two venues: Strategy, logistics, resource allocation, competencies, recruitment and retention, intelligence, leadership, and the list goes on.

Stakes are high in any business arena. Poorly outfitted strategies can affect market share; sufficiently convoluted institutional cultures can weaken moral and production; failure to innovate and outpace the market can quickly dwindle profits and catalyze a downward spiral. These challenges, and innumerable others, create real world problems. Jobs are lost. Mortgages go unpaid. College funds are vacated. But in war, the stakes are exponentially higher. If a strategy is poor, jobs aren’t lost, lives are. If a platoon’s cohesion is weakened, profits don’t dwindle, people die. Certainly, there is much to be learned from successful and unsuccessful entrepreneurs, executives, and practitioners. At the same time, where minds are focused by true life-and-death realities, gems of wisdom have to emerge.

Today, I speak with retired lieutenant colonel (US Army) and recognized counterinsurgency expert John Nagl. A West Point graduate, Rhodes Scholar, and having written his doctoral dissertation on insurgencies, Nagl has fought in two wars—Desert Storm and Operation Iraqi Freedom—co-authored, along with General David Patraeus, the Army/Marine Corps Counterinsurgency Field Manual, and is the author of two counterinsurgency books of his own—Learning to Eat Soup with a Knife: Counterinsurgency Lessons from Malaya and Vietnam and Knife Fights: A Memoir of Modern War in Theory and Practice. I explore Nagl’s thoughts on the parallels and contrasts between the theaters of business and war, seeking functional lessons that transcend boundaries. See our exchange below:

On Parallels Between Business And War

Parnell:  War is used often enough as a metaphor for business. But from your viewpoint, are they really similar? What are your thoughts on that?

Nagl:  So, after twenty years in uniform and two wars, I’m now running my second business. I ran a non-profit in Washington for three years; I’m now running a school. So I have some appreciation for both the business and military worlds. I think there are similarities. Leadership really matters.  A focus on the objective is absolutely necessary.  Both are competitive exercises in which you operate under conditions of uncertainty.  Innovation matters, and the ability to see around corners and predict, to at least a certain extent, the shape of the future, is imperative. All these things in all of these ways, I think, are similarities and parallels between business and war fighting.

Interestingly, war fighting increasingly depends on the products of businesses. It used to be governments made their own weapons. Today, the fittings of war are produced by privately held companies: by General Dynamics, by Northrop Grumman, by AM General. Business and warfare are intimately linked and will continue to be. Further, I think we’ve seen many successful military leaders become good businessmen, become good business leaders, and have also seen the principals of effective leadership transfer across from one field to the other.

On The Military Drawing Lessons From Corporate America

Parnell:  I understand that the military relies on business to carry out wars, but does the military draw lessons from business? I seem to remember reading an article where the military was looking at the logistics used by Walmart. Are there any examples that you know of?

Nagl:  Absolutely. A good friend of mine was, and still is, with McKinsey [& Company]—worked with their industrial practice. I helped him get a job working with the Air Force at the very highest level, working directly for the Secretary of the Air Force applying principles he learned—things like lean six sigma; stuff you’d learn working with Toyota, for instance—and transferred that to the Air Force, in its fleet.

The Air Force will tell you that it has the best aircraft maintainers in the world, and maybe they do, but United turns airplanes around a whole lot faster than the US Air Force does, and on a daily basis. So there are absolutely things that we can learn from each other. And these kinds of dialogues are extremely important and very useful.

On The Effects Of Uncertainty In The Field

Parnell:  Uncertainty, obviously, is something you have to deal with continually in war. This is also the case in business. What are some of the challenges that you’ve found uncertainty might create in the field? And how do you seek to overcome them?

Nagl:  In Desert Storm we were fighting a conventional army that looked similar to ours. So we weren’t sure exactly where the enemy tanks were, exactly what their fields of fire were, exactly where there were mine fields. We dealt with that uncertainty, which was easily defined. But, those were life or death kinds of mistakes if we got it wrong.

In my next war—Operation Iraqi Freedom—we were not fighting a conventional enemy, but  guerrilla warfare. We were fighting insurgents. And now the uncertainty we dealt with was pervasive, was everywhere. We didn’t know who our enemies were. We couldn’t tell whether someone we met on the street was an insurgent wearing civilian clothes or was a real civilian. And people, of course, could rotate between roles, could switch those roles very rapidly. And, so, uncertainty is pervasive in warfare. And even more so in irregular warfare. The kind we’ve been fighting for the last fifteen years, and I believe are likely to fight for the foreseeable future.

As far as challenges go, we had to devote far more resources to gathering and using intelligence, toward discerning who our enemy was, where he lived, what his objectives were, who his friends were in counterinsurgency warfare. So facing different enemies resulted in a pretty dramatic redesign of our forces to increase the intelligence assets we had available to help us identify our opponent. With those different circumstances, you need a very different kind of force to win your battles. And the only way to mitigate that uncertainty—I say mitigate because you will never remove it—is to tailor your intelligence accordingly.

On Military Strategy Development

Parnell:  Going up a level of abstraction, can we look at strategy in general? Can you talk to me about that at a 20,000 foot view? How would you go about developing strategy?

Nagl:  I recently published a piece about what we need to do against the Islamic State. In it I lay out the standard strategic paradigm I use, which is “ends, ways, and means.” “Ends” are what it is that we’re trying to accomplish. “Ways” are how we’re going to go about doing that. And “means” are the resources we have available to use in that way to accomplish that end.

And, so, laying it out for the fight against the Islamic State, the President is correct in that our objective should be to defeat and ultimately to destroy ISIS. The way he intends to do that is through the use of the local forces; in this case, Iraqi and Kurdish armed forces supported by American advisors, American air-power, American intelligence assets, American logistics, and combat multipliers that we can bring to the fight to make their forces more effective. So that’s all good.

The problem I have is with the means the President has allocated to this fight. The resources he has made available were only a laughably-small 1500 American advisors up until two weeks ago. Now he doubled that up to a still paltry 3000. I argue that the resources needed, the means required, to accomplish the President’s correct objectives in anything like a reasonable period of time, are a multiple of what he’s promised. In fact, multiple-times-ten in what he had until two weeks ago—times-five what he has now. We need 15,000 American advisors on the ground in Iraq just to defeat ISIS inside Iraq. The question about what to do inside Syria is another question entirely.

So, while developing a functional strategy is, obviously, significantly more detailed as you get more granular, “ends, ways, and means” offers both military and business strategists a way to guide their thinking.

On Action And Reaction In Strategy—The Arms Race

Parnell:  Action and reaction. When you’re developing strategy, it is presumably with the purpose of achieving [at least] a somewhat predictable outcome. Once that outcome results, however, then you’re going to have to respond accordingly—the reaction to that outcome. This phenomenon compounds on itself. For example, certain types of strategically-developed technology will beget other types of technology, which will beget other types of technology, and this can quickly turn into a race. How does this fall into the development of strategy?

Nagl:  What you are describing is, basically, an arms race. And here’s another parallel between business and military operations, including war. The enemy is going to seek counters to your moves, and is going to be constantly innovating and trying to achieve an advantage over you. So your ability to innovate—in terms of the materials of a war, the tactics you use, the rapidity with which you can adapt—are all factors that determine success or failure in war.

Learning To Eat Soup With A Knife ] actually looks at how organizations adapt to change, and has led to me doing some engagements with McKinsey [& Company].  I’ve led talks with the healthcare industry about adapting to change and about building adaptive-learning organizations that can respond rapidly to changes in their strategic environments.

Parnell:  Okay. So “adaptive-learning,” that’s an interesting phrase. I’m assuming that would be built into the actual strategy?

Nagl:  Increasingly, it is. And, so, [The Counterinsurgency Field] Manual that I helped General David Petraeus write includes chapters on the constant evaluation of your strategic plan, evaluation against your goals, and rapid revisions to that plan if you are not currently meeting your goals. While the stakes may be different in business and war, they are both very high in their own right, and an adaptive strategy is, as we are increasingly finding, an important weapon in an institution’s arsenal.

On Weighing Efficiency Versus Effectiveness

Parnell:  Weighing efficiency versus effectiveness: This is something that can be a tightrope for CEOs, entrepreneurs, managing partners, and practicing lawyers, alike. In military operations, how are you weighing efficiency versus effectiveness? Can you talk to me about that?

Nagl:  That’s a great question. This is one of the places where business and warfare are very different. And this is one of the things that Secretary of Defense Don Rumsfeld—a very good businessman, but I would say not as strong a Secretary of Defense as he was a business leader—focused relentlessly on: efficiency. Business leaders should focus on efficiency; you don’t want to have anything left over. This is especially so when you are billing by the hour. The more efficient you are with your time, the more money you make.

In the military, the costs of failure are so great that effectiveness is far more important than efficiency, even if it is at the complete cost of efficiency. So in the invasion of Iraq in 2003, Secretary Rumsfeld focused ruthlessly on efficiency in paring down the number of troops that we deployed. But as a result of this focus on efficiency, unfortunately, we didn’t have enough troops to maintain order in Iraq after Saddam’s government fell. We didn’t have enough troops to secure all the weapons sites.

Parnell:  Is this a variable principle for the military? Or is it fast?

Nagl:  This is a big difference between warfare and business. In business if you were as profligate with the use of resources as successful commanders are in warfare, you would be fired. (Laughing) In warfare, I think it was Nathan Bedford Forrest who said, “Get there firstest with the mostest.” In both war and business, there’s an internal tradeoff between quality, speed, and cost. And you’ve got to locate yourself among those three axes. In warfare, it’s easy: you don’t prioritize cost. Cost in dollars is close to irrelevant. But in corporate America, it truly is a challenging and quite necessary endeavor to walk that tightrope between quality, speed, and cost.

On The Role And Effects Of Risk

Parnell:  Risk is something that is native to the business world. Lawyers, in particular, deal with risk every day. In fact, it isn’t a stretch to say that one of their primary functions is to assess, mitigate, and/or remove risk for their clients. At a 20,000 foot view, how do you deal with risk? How do you assess it? Is there a general principal or algorithm that you use? What factors are involved?

Nagl:  There are many different things that are at risk, right? You risk losing the war. If it’s a war against Al-Qaeda—as we have engaged in for the last 15 years—you risk putting the American population and the homeland at risk. So the risk of mission failure is something that weighs very heavily.

There is also risk to personnel, so you try to find ways to minimize the risk to your soldiers. You procure the right weapon systems for the environment they’re in; you procure the latest body armor, which we struggled with early in the Iraq war in 2003-2004. I, for instance, served 11 months in Al Anbar in an unarmored Humvee before I finally got armor on that weapon system. You try to get really small in your Humvee with the hope that something wouldn’t hit you and kill you. I lost friends because we had not prepared for the kind of war we were fighting. So I think it’s vital to assess risk before and during war, to define the various things at risk, relentlessly and thoroughly assess and prioritize them prior to, and during, your strategy development, and in an ongoing basis.

On Assessing Competencies

Parnell:  Regarding competencies—assessing your own and assessing your team’s. Is there a particular practice for that in the military?

Nagl:  The military’s practice is pretty effective.  The military has a good talent recruiting program and is good at talent evaluation.  It has a good retention program, including a phenomenal and generous retirement program, of which I’m currently a beneficiary.

The problem the military faces, and I talk through this in [Learning To Eat Soup With A Knife], is that it doesn’t necessarily know what kinds of talent it’s going to need, what kinds of talents to reward. And, so, here’s another difference between business and war. In business you know every day how well you’re doing. Right? So one of Forbes’s big competitors might be Fortune. But you know every month how you’re doing against Fortune, so you can adjust. You can make management changes, editorial changes, pricing strategy changes, etc. But there’s a feedback system that tells you daily, or at worst, monthly, how well you’re doing. In the military, it can be a generation between wars. So you can get it badly wrong.

I would argue that this is what we did in the wake of Vietnam. We got it badly wrong. We decided after Vietnam that we weren’t going to fight any more counterinsurgency campaigns. So we planned, prepared for, and organized ourselves to conduct Desert Storm-kind-of operations against peer mirror image forces of our own. And funnily enough, we whomped them in exercises and simulations, but those weren’t the kinds of wars we actually ended up fighting in this century.

On Intelligence In Strategy And On The Field

Parnell:  On the role of intelligence in developing strategy, or just intelligence in general—how do you gather that in a military setting? Is there a particular sequence of actions that you take? Particular avenues that you go down? How do you deal with intelligence in general?

Nagl:  We have intelligence specialists who go through dedicated training to gather intelligence, and perhaps more importantly, understand intelligence—what is important and what isn’t. One of the things we learned in the most recent wars in Iraq and Afghanistan is that the specialists need to understand the societies in which they’re working. So we established a number of programs to try to increase our cultural intelligence, our linguistic skills, our sense of history, our sense of geography, and knowledge of religious beliefs, tribal structures, and local power arrangements. None of that is any surprise to anybody who has succeeded in business and has expanded into new markets. Intelligence is absolutely important. And the more irregular the enemy you are fighting, the less conventional the war is, the more important the intelligence is.

Parnell:  Importantly, the avenues, or we will say, tools and people for gathering that? The people, in particular, need to be able to understand the intricacies of that intelligence in order to determine whether it’s useful or whether it’s not.

Nagl:  Absolutely correct. It’s very easy to be buried in useless information. There’s a human process that turns it into intelligence that affects command decisions.

On Dealing With Emotions In The Field

Parnell:  Emotions… I’m not a soldier. I can only imagine what it’s like to be in war. But I have to assume that there are a lot of emotions involved. Can you talk to me about the role of emotions in the field?

Nagl:  Soldiers remain human when they put on a uniform.  They have emotions, mourn their losses, celebrate their triumphs.  They’re scared, cold, and hungry—that is in fact a basic condition of war: it’s either hot or cold; you’re always tired; you’re always hungry and you’re always dirty. But you try to train to mitigate those effects and develop routines so that you can try to take emotions out of it.

We also find ways to design our weapon systems to take emotion out of warfighting. For example, in Desert Storm, in my first war, when I was fighting in my tank, we had a laser range finder, we had thermal sights. We weren’t looking at human beings through our sights; we were looking at “hot spots.” And we weren’t killing people; we were “servicing targets.”

I remember we were in our first hot firefight “servicing targets,” and my gunner pulls his head away from his sight and looks up at me and says, “This is just like our Conduct of Fire Training system.” And I said “Targets. Right.” Which meant, “I don’t have time for a philosophical discussion right now. There are targets to be serviced, Sunshine. We’ll have the philosophical discussion later.”

Parnell:  That’s really interesting. I’ve never really thought about it like that. But do you think that was volitional, purposeful, to be using benign terminology?

Nagl:    Oh, yeah. The language is antiseptic for a reason. And the human-factors engineering goes into the designing the sighting systems to make the targets both as easy to identify as possible, and as easy to service as possible. But also, I think, to minimize, to the extent that we can, those combat emotions that soldiers who are human are going to feel.

Parnell:  So, what I am hearing is that emotions are, generally speaking, not a constructive element in war. At least that they aren’t helpful in combat. How about from an on-the-ground business perspective?

Nagl:  Well, let me give the opposite: teamwork. Building a team that can function under adverse conditions—the people who trust each other to literally have each other’s back. Those types of emotions are vital. What people fight for, or work for, ultimately, is not an abstract idea—it’s not democracy, it’s not freedom. In most cases, American soldiers fight for the guy next to them. And, so, we spend a lot of time cultivating and encouraging those feelings of loyalty, and brotherhood, and teamwork, and feeling part of a team. That’s absolutely essential to success on the battlefield, and, I would argue, in business.

Email: dparnell@davidjparnell.com Twitter: @davidjparnell

Books: The Failing Law Firm: Symptoms And Remedies; In-House: A Lawyer’s Guide To Getting A Corporate Legal Position