When diversity increases, unit costs must also increase, because of all those different spare-parts and training needs. But less standardized military forces are more resilient. Whereas the civilian concept of efficiency calls for maximum standardization, ultimately yielding one-gun/one-tank armies, one-fighter air forces, and one-ship navies, military effectiveness demands diversity to resist the enemy’s outmaneuvering effort.
The divide between efficiency and effectiveness is at its deepest in combat. What are the most effective military operations? In very general terms, they are operations in which the enemy is not outfought by greater firepower, greater numbers, greater bravery, and greater sacrifice of lives, but instead surprised and then outmaneuvered and disrupted, and thus never given a chance to fully employ his fighting capacity in the first place.
And what is the common denominator of such operations? Inefficiency.
Consider surprise. How is it achieved? By deception – unless the enemy is merely apathetic or unobservant, and therefore outclassed to begin with. And how is deception achieved? By doing the unexpected. And what is the unexpected? Something other than the sensible, normal, and efficient. Thus an offensive fully prepared – for which all the appropriate forces are assembled and all the necessary arrangements are carefully made to position each unit and each force at exactly the right place – cannot possibly catch the enemy by surprise, simply because in seeking to use all available means as efficiently as possible, we would broadcast all possible warning signals of the coming offensive to the enemy. If there is to be any hope of achieving surprise, some preparations must visibly be left incomplete, and some forces must remain unready or ill positioned; to add to the inefficiency, some forces and much effort must be put into camouflage, decoys, simulations, feints, and diversions.
This, therefore, is the supreme irony: the public, media, and Congress deplore, criticize, and punish inefficiency. Managerial-minded Secretaries of Defense – like Caspar Weinberger and, far more clamorously, Robsert S. McNamara – insistently promote new managerial schemes whose goal is to increase efficiency. What all parties desire and preach is a more “businesslike” Pentagon. But conflict is not like civilian business and efficiency is the wrong goal to pursue: efficiency in making a radar or refueling a ship, of course; efficiency in making radars, or refueling ships, no, for efficient economies of scale in purchasing radars lead to a single mass-produced radar that will be more easily counter-measured, and efficient refueling leads to a few large fleet oilers that are more easily intercepted and destroyed by the enemy. (Each of our majestic aircraft-carrier task forces is now dangerously dependent on a single, very large, very efficient resupply ship.) Conflict is different…
That was Edward Luttwak in his 1985 book, The Pentagon and the Art of War. Not much to add to that, except that perhaps Luttwak overemphasizes how different war is from other experiences. I think that a similar lesson applies to market competition between innovative firm in a non-military setting.
Whereas in war, efficiency presents new opportunities for an alert enemy to exploit, in business, the efficiency of one firm makes it ill-equipped to exploit new market opportunities which will eventually dominate over the medium- to long-run. In both cases, the devotion to efficiency opens the organization up to risk of total destruction (or bankruptcy).
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