Stratagem 6:Kill with a Borrowed Knife.
“Your enemy’s situation is clear but your ally’s stand is uncertain. At this time, induce your ally to attack your enemy in order to preserve your strength. In dialectic terms, another man’s loss is your gain.”
—From The Thirty-Six Stratagems
Your adversaries’ adversaries are likely to be your friends. In one famous case, Coca-Cola showed this to be true. Coca-Cola attacked its adversary by manipulating a competitor.
In the mid-1980s, Coca-Cola and Pepsi had been using the NutraSweet brand of the chemical aspartame to sweeten their diet products. They used the same brand of sweetener because the supplier, Monsanto, held a patent on aspartame production. However, this patent would soon expire—in 1987 in Europe and in 1992 in the United States.
Once the patent expired, Coca-Cola and Pepsi could potentially switch suppliers. This clearly would lower costs. But both beverage companies had good reason to stay with Monsanto: Whoever switched suppliers would have to remove the NutraSweet brand from its can. If Pepsi did this and Coca-Cola did not, Pepsi would lose consumers to Coca-Cola. If Coca-Cola did this and Pepsi did
not, Coca-Cola would lose consumers to Pepsi. In other words, unless someone upset the balance, neither drink company would switch. And because neither beverage company would switch, no
new competitor would have reason to enter the aspartame market. The economics of entering the aspartame market without the possibility of gaining one of the two largest accounts were unattractive. Monsanto’s hold appeared firm.
To free itself from this trap, Coca-Cola borrowed a knife: a new aspartame producer. It encouraged the Holland Sweetener Company to develop an aspartame business to compete with Monsanto
once Monsanto’s patents expired. The Holland Sweetener Company, betting that Coca-Cola would become a customer, built capacity in Europe in 1995, two years before Monsanto’s patent
was due to expire there. It then developed plans to build capacity in the United States.
For the first time, Monsanto faced a genuine threat. Before the Holland Sweetener Company had existed, any threat by Coca-Cola to switch suppliers was impossible. Now such a threat was merely impractical. Before Monsanto’s patents expired, and before the Holland Sweetener Company could begin selling aspartame, Coca-Cola and Pepsi used their newfound leverage to negotiate long-term, lowprice contracts with Monsanto, effectively killing the Holland Sweetener Company’s chances of survival. It is unlikely that Coca-Cola or Pepsi ever intended to award the Holland Sweetener Company aspartame contracts. The company was a pawn—a borrowed knife.
Coca-Cola’s maneuver illustrates one application of the stratagem Kill with a borrowed knife. It borrowed a supplier’s competitor to attack a supplier. But the stratagem’s applications are diverse.
Each agent whose actions influence your success is a potential target for this stratagem. Take consumers as an example: Borrowing one consumer to market to another can create “buzz marketing.” Or consider the government: Borrowing regulators (e.g., through lobbying) changes the rules of the game to become more advantageous. The list of potential targets is unlimited.
Borrowing a Customer
Several of the fastest growing, most profitable companies of the decade have set in motion a self-generating cycle of customer-tocustomer marketing by setting up structures that enable customers
to efficiently market to their peers. The community service for which Timberland is famous, for example, fuels this dynamic among its loyalists. Another example is Tiffany & Company. Walk
out of a Tiffany store and the distinctive Tiffany bag transforms you into a walking advertisement. Others in the mall see the bag and get the urge to walk into a Tiffany store as well. This is why
Tiffany gives its bags such prominence in commercials and why the bag is the one thing in the store you cannot purchase on its own. Are your customers serving as “borrowed knives”?
The origin of the term borrowed knife is unknown. But a story from the Spring and Autumn period (770–476 BC) helps illustrate its essence.
A duke in the state of Qi owed much of his prosperity to three knights, whose abilities and strengths had delivered many victories over the years. Stories of the knights’ exploits had propelled them
to hero status. The duke, though grateful for the knights’ contributions, was concerned by their growing power.
When the knights showed signs of disobedience, failing to salute a high-ranking government official, for example, the duke decided to take pre-emptive action and have them killed.
For political and practical reasons, however, the duke could not act directly against the knights. What soldiers would have the will and courage to confront the state’s most capable warriors? And if the soldiers somehow succeeded, how would the duke manage the popular reaction? The duke needed to borrow a knife, and he chose knives that had never failed him before—the knights themselves.
He wrapped two peaches in a gift box and anonymously sent them to the knights with a note that read, “He who has performed the greatest deeds may take a peach.” The knights opened the gift
and read the note. Then two knights each grabbed and ate a peach, each believing his deeds to be the greatest.
The third knight looked up from the now-empty fruit basket and stared furiously at his colleagues. He called them liars. He accused them of greed and conceit, of breaking their code. He reprimanded them so severely that they took their lives.
When the remaining knight’s rage subsided, he came to terms with the finality of his words. He had killed his two dearest companions over meaningless pride. His sense of guilt eventually drove him to suicide. The duke was free, and his hands were clean.