[Editor's Note: In their forthcoming book, The Marine Corps Way: Using Maneuver Warfare To Lead A Winning Organization (McGraw-Hill, 2003), Vincent Martino, Jason Santamaria and Wharton professor Eric Clemons explain how maneuver warfare -- the modern-day combat philosophy of the United States Marine Corps -- can be applied to business.]

In the simplest of terms, maneuver warfare is the use of speed, surprise, and concentrated force against an opponent's weakness to achieve a maximum impact with a minimum expenditure of resources. In business, this outcome implies maximizing profits by employing resources in the most efficient manner.

Maneuver warfare can serve as a useful guide for business thinking, particularly in today's fast-paced, complex, fluid, and uncertain business environment. Most business strategy models assume a rational marketplace, governed by order, consistency, and normalcy. Maneuver warfare, in stark contrast, assumes an environment dictated by chaos, uncertainty, and friction and prescribes that victors embrace these unavoidable realities as a source of competitive advantage.

Maneuver warfare, as we have distilled it, comprises seven guiding principles: targeting critical vulnerabilities, boldness, surprise, focus, decentralized decision-making, rapid tempo, and combined arms. These principles, potent when applied individually and devastating when applied in subsets or as an integrated whole, provide a useful framework for thinking about business strategy.

Targeting critical vulnerabilities aims to identify and exploit fundamental weaknesses that are indefensible. Weaknesses can be competitor-oriented -- an opponent's Achilles' heel -- or market-oriented -- a grossly underserved need that has yet to be exploited.

Boldness is the daring to seek breakthrough results rather than incremental ones. It requires enterprising leaders who take calculated risks absent complete information. Indeed, what differentiates boldness from recklessness is the constant and thoughtful weighing of risk and reward.

Surprise is the use of information to shape the rules of the competitive encounter before it begins. It can be achieved using one of three approaches: stealth, ambiguity, or deception. Surprise can be subtle -- leaving information on display to force a competitor's hand, or more deliberate -- a move aimed to convince a competitor that something is happening other than what is actually occurring. While the thought of duping a challenger can be attractive, ethical lines should never be crossed.

Focus is the concentration of overwhelming resources -- information, capital, personnel, and physical assets -- to achieve an advantage when and where it matters most. Focusing resources in such a manner often enables a seemingly small competitor to upstage a larger rival.

Decentralized decision-making gives those closest to the action the latitude they need to exercise initiative and capitalize on emerging opportunities. It is grounded in the belief that those closest to the action possess superior information and thus can make better-informed decisions. Decentralized decision-making enables a superior tempo of operations by eliminating the need to wait for approval from supervisors removed from the situation.

Tempo entails identifying opportunities, making decisions, and executing faster than the competition. Superior relative speed allows an organization to dictate the terms of an engagement by forcing a competitor into a constant state of reaction.

Combined arms, the integration of complementary capabilities in such a manner that increases their collective effectiveness, places competitors in an inescapable, hopeless situation, where countering one move renders them vulnerable to another -- what the Marines refer to as the "horns of a dilemma."

Leadership: the backbone of maneuver warfare. At the heart of maneuver warfare is leadership. Whereas maneuver warfare, adopted about fourteen years ago, is relatively new to the Marine Corps, leadership has been the hallmark of the Marine Corps since its inception in 1775. Marine Corps leadership, as applied to business, comprises three pillars: leadership by example, taking care of those in your charge, and leadership development. These pillars, in turn, inspire and reinforce trust, integrity, initiative, and unselfishness, without which maneuver warfare would fail.

Elements of maneuver can be found behind many business successes: from Pepsi's use of stealth to launch the soft-drink Mountain Dew Code Red, to Lowe's Hardware's use of targeting critical vulnerabilities to break Home Depot's once-indomitable hold on the home improvement market, to Juniper Networks' use of focus to trump Cisco Systems in the Internet router market, to Lexus's use of combined arms to lead the U.S. luxury auto market. In The Marine Corps Way, we present forty-six examples of maneuver warfare from the military and business. Through a case-based approach, we utilize these examples, as well as present-day practices of the Marine Corps, to describe how you can apply maneuver warfare in your business.

While the merits of maneuver certainly sound compelling, throughout our research and work on this topic, we've been repeatedly asked: "If maneuver warfare is so great, why doesn't everybody do it?" Our answer: "Because it is hard." It takes self-confidence, an appetite for risk, sound moral character, and an absolute commitment. Above all, it requires leadership. Given the indispensable role leadership plays in maneuver warfare, companies must over-invest in leadership training -- as the Marines do -- to build the requisite level of trust and teamwork.

Marines have built a reputation as arguably the world's preeminent fighting force, and through years of innovation and refinement, have honed their practice of maneuver warfare to a sharp edge. Their experience suggests that maneuver warfare has the potential to transcend environments -- just as it has transcended time -- to allow businesses to do more with less, shape competitive encounters, and achieve breakthrough results.

Note:  Vincent Martino is a former Marine officer, MBA graduate of the Wharton School, and graduate of the U.S. Naval Academy; he can be reached at vincent.martino@themarinecorpsway.com. Jason Santamaria is a former Marine officer and MBA graduate of the Wharton School, and he previously worked in investment banking at Morgan Stanley and in consulting McKinsey & Company; he can be contacted at jason.Santamaria@themarinecorpsway.com. Information on The Marine Corps Way is available here.

SERIAL ENTREPRENEURS: The Leadership Advantage of the Innovator's Relations

The innovator's badge of courage in Silicon Valley is to have launched several start-ups. One of the best known practitioners of the art of serial entrepreneurship is Jim Clark, featured in Michael Lewis's book, The New New Thing (published in 2000). Clark founded Silicon Graphics in 1981, Netscape in 1994, Healtheon in 1996, myCFO in 1999, and Shutterfly in 1999. With each successive startup, he was able to attract venture capital earlier in the process and at higher valuations.

In a study of 149 high-technology startups that obtained venture capital funding, researcher David Hsu has confirmed that Clark's experience is common to the new venture field. For a doubling of prior start-up experience, he found that the serial entrepreneur was 19 to 23 percent more likely to attract early-stage funding from direct ties with venture capitalists. Moreover, a doubling of the entrepreneur's prior start-up experience led to a 21 to 27 percent increase in the firm's valuation.

These serial effects were found to be strengthened by successful experience with the entrepreneur's first startup. Entrepreneurs with a high internal rate of return – at least 100 percent – in their first startup were 27 percent more likely to attract early financing via direct ties, and they benefited from a 45 percent boost in valuation.

The advantage of prior startup activity, however, was not just a matter of accumulated personal experience. It was also partly a product of personal ties that the serial entrepreneurs had established with the venture capital community. Those ties provided the serial entrepreneurs a better roadmap for locating interested venture capitalists, and they also furnished the venture capitalists with a better appreciation for the quality of the entrepreneurs.

By implication, a capacity for successfully starting a new enterprise is not only the business model in the mind of the entrepreneur – but also the personal relations that the entrepreneur has established with venture capitalists.

Note:  David Hsu, "Serial Entrepreneurs and Antecedents to Start-Up Performance" (September, 2003); David Hsu can be reached at dhsu@wharton.upenn.edu, and related articles by him can be found here.