Business strategist says that knowing your competitors is one of the crucial keys to success
BEIJING - James Sun believes that most businesses don't even know they are at war.
James Sun is setting up a $100 million hedge fund this year with an ex-Morgan Stanley banker to invest in the Asian emerging markets. [Provided To China Daily]
The 33-year-old TV host, public speaker, investor and entrepreneur travels the world, dispensing advice on fixing businesses. During a phone interview from Melbourne, he said he was convinced the main reason why some businesses were teetering on the brink of collapse was because they didn't know themselves or their competitors.His prescription? Use the principles of the 6th century BC Chinese military strategist Sun Zi.
"Business is not something to be taken lightly," he said. "That's great if you have a passion for entrepreneurship but you had better be serious about it. It's like going into battle. It's like going to war.
"Look at the competitors as if they are willing to eat you. It's a zero-sum game to an extent. Seizing the enemy without fighting is the most skillful." Hence, surveying the market with alertness to competitors' advantages and weaknesses is one of the crucial keys for survival. From a traditionally run clothing business to a multinational, Sun said no company should be spared the Sun Zi treatment in an effort to invigorate flagging sales.
"In general, I feel that entrepreneurs in China don't go into business with the right attitude. They treat their businesses as hobbies and just to make money," he said. "When you ask them what they want to do with their business, most of the time they say they want to do good for society. But when reality sets in - that they couldn't make money out of charity - then what should they do?
"They have to change their mindsets. They need to adopt an attitude with military strategy such as Sun Zi. Win without warring. If you know both yourself and your enemy, you can win 100 battles without a single loss."
Spoken with conviction and from experience, Sun is a "general" in the know and is no stranger to wars. Against all odds, he broke barriers in the business world; his colorful life story, so far, shows no lack of determination, perseverance, shrewdness, hard work, luck and good timing.
Born in Seoul, raised in the United States and of Chinese and Korean ancestry, his family migrated to the US in 1981 with only $35 in their possession. They had no contacts and spoke not a single word of English. He had a rough childhood while growing up in Houston, Texas, where he battled racism and discrimination.
This background ignited a fiery drive in him at a young age to be successful. He owned a small business offering window-cleaning services at the age of 11. After graduating high school with a perfect 4.0 grade point average, he started a technology investment company with $5,000. He became a millionaire by 23 when he sold the company for more than $2 million while graduating with honors from the University of Washington.
First breakthrough
He went on to be employed by Deloitte Touche Tohmatsu, offering consultancy services to Fortune 500 companies. In 2007, he got his first breakthrough on TV when he landed a spot on Donald Trump's reality show The Apprentice, on which he was the first Asian to appear, and was one of the finalists for season six (from January to April 2007).
With the business community shell-shocked by the financial crisis, Sun cleverly thought out a 13-part series of TV shows that began in February, aptly titled Sun Zi - War On Business and aired by Channel NewsAsia on Tuesday, Wednesday, Thursday and Friday evenings.
Filmed in China, India, Australia and Singapore, "Sun Zi - War On Business" is jointly commissioned by Media Corp, BBC Worldwide and the Media Development Authority of Singapore.
Modeled on the reality TV concept, Sun gets to be tough with business owners in Asia to try to solve their problems by using quantitative and qualitative analysis including Sun Zi's principles to help troubled companies regain their footing.
Together with a local expert, Sun reveals problems in the "War Room" segment, in which he gives hard advice on how to improve the business and set challenges and tests for the entrepreneurs to overcome. He then returns at the end of the process to give his final comments on the future of the business.
In China alone, he has so far consulted China Culture Center, a cultural education and tour operator, and Plastered-8, a T-shirt brand in Beijing. Those are on top of the other businesses that he has helped which included The Prince of Wales' Duchy of Cornwall, a backpacker hostel-cum-caf in Singapore, a traditional Indian clothing business and a wine-making company in Australia.
While the main stumbling block is to get business owners to listen to his analysis and implement Sun Zi principles, he said he saw no reason why owners shouldn't give it a try. Most do because he has the right credentials.
"Look, I have been an investor and an entrepreneur. I started a few companies - rolled-up my sleeves, laid the foundations, wrote checks etc. It's not just consulting experiences. If you have never known how to collect and write a check before, then you don't know how to run a business," he said.
The series not only merely profiles successful businesses but explores what makes entrepreneurs tick, he stressed.
"It's a show that looks at the entrepreneur deep in his heart, in his mind, and asks hard questions about why he is doing it, how he achieved what he did and what he is going to do in the future - and my job is to use Sun Zi's analysis to help them get there."
His advice to those who want to enter or remain in the Chinese market: Be careful. Despite the continued booming Chinese economy, he said the market, which has grown tremendously, had created uncertainty.
"Launching another widget will not work. You have to be smart and strategic. The Chinese market will be overcrowded because every business would want a piece of the pie."
Entrepreneurs in China, he said, are on the right track because most still think of effective cost and labor. "It's still an export market," he said. However, he reckoned that most foreign companies didn't understand the Chinese market. Managing expectations and understanding the local culture are two most important criteria to survive in China.
Brands building
"Many plan to build their products through branding. It will not work unless they are established brands such as Gucci, Prada and Louis Vuitton. If you're not on the prestigious brand league, then it's a distribution game."
The other common mistake most companies commit is to team-up with the wrong joint-venture partner. "Different goals, missions and, in the end, the partner turns out to have different objectives," he said.
He viewed 2010 as a time for companies and entrepreneurs to invest strategically as 2009 was a year to retreat for reinforcement. "It's like pulling back your troops and planning for the next strategic move to be undertaken in 2010," he said. "Every industry is a little bit different but, say, you had slashed your marketing or sales force by 20 percent last year, you should add back the 20 percent or more this year for growth. It doesn't have to be going abroad to gain market share. Just focus on gaining back lost market share and more in your existing market," he added.
And true to the spirit of Sun Zi's principle of terrain, Sun said Asia is the right place to be at the moment. He revealed that he is setting up a $100 million hedge fund this year with an ex-Morgan Stanley banker to invest in Asian emerging markets such as India, China, and Southeast Asia. "Personally, I like the principle of terrain; I use it all the time. It's about how you adjust to your surroundings, just like how water goes over and around the rocks," he said.
