0:05 Who are you and where are you going? What do you want? [Music] Hello and welcome to Business Lessons from the Military. I'm your host, Kevin Bemel, and we're here every Tuesday at uh 10:00 a.m. Pacific time to talk about military history, doctrine, and the practices of great military leaders and distill from them lessons that we can apply to our businesses and professional
0:41 practices to make them more successful. So, this is my way of giving back to my fellow veterans uh and and my uh fellow citizens for uh all the um training and support that I got uh when I was in the United States Navy. So, uh today we're going to be on the military history side of things. I'm going to be talking about the Battle of Bunker Hill. Uh today is the 250th anniversary of this um um of this event.
1:21 And uh and so we're going to we're going to I'm going to talk about what happened at Bunker Hill or actually most of the action took place at Breeds Hill, not not Bunker Hill, but for some reason through down through history, Bunker Hill has been the one that's been remembered. and and then uh again, you know, talk about some some lessons that we can can learn from uh from this uh well-known battle. So uh at since today is June 17th uh and this is the 250th anniversary, so that
1:56 means the battle of Bunker Hill uh took place on June 17th, 1775. Uh it was obviously in the very early part of the uh American war for independence and and like I said it actually took place um mostly on Breeds Hill which is uh very close to Bunker Hill and um what happened was um the colonial militias who that's who was fighting at this time in the American Revolution. So
2:31 they um they had fortified uh Breeds Hill and um had and were threatening uh British control of Boston. And the British troops uh under uh General William Howell uh were were given the job of of attacking this um you know colonial militia u sort of entrenchment if you will. and they they attacked in three waves. Um, and Americans uh led by Colonel William Prescott actually held off the first two
3:09 assaults. Uh, and his his famous sort of call to action was don't fire until you see the whites of their eyes. Um, and that was to conserve their ammunition because the colonials were um perpetually under supplied with really everything from clothing to food to ammunition. And so they couldn't waste their shots and so um, Colonel Prescott basically wanted the to let the British get as close as they could so
3:44 that every shot would tell. So, um, in the end, um, the American troops ran out of of gunpowder and were forced to retreat off of Breed's Hill. Uh, the British captured the hill. Um, but they suffered over a thousand casualties, um, including many officers. So, American losses were were much fewer, maybe about uh, 400 or so. Um and despite the tactical defeat, American morale rose. The the fact of the matter
4:21 was uh this was a large force, a large British force and it was widely considered that the British would just overrun the Americans and indeed uh in the end they did not. uh and and and the Brit British, although again they eventually took Bunker Hill. Um it was only at great losses and it took them three attacks in in in order to do so and and probably only did so because uh the American colonials uh ran out of gunpowder and so couldn't fire their their musketss and
4:58 rifles any longer. So, uh, in the end, from a strategic standpoint, it proved to, uh, the to to the Americans that, um, the colonists could could challenge u the Great Britain's professional army. uh and and and that and also that you know they didn't necessarily need to win a battle outright in order to pardon me win a battle right so uh it's it's it's it's an interesting uh
5:33 phenomenon that it was a tactical loss but I think you would one would call it you know a strategic win so uh what what can we what can we learn from a business standpoint uh based on the battle at Bunker Hill. So first lesson is that appearances can be deceptive. So we shouldn't underestimate small players. We I think that's the tendency in in in so many sectors of business. Um we've got all these huge
6:10 players. So for example, the American car industry, it used to be uh the the big three uh General Motors, Ford and Chrysler were essentially the big three automotive makers. And now there are numerous uh small companies that have started up uh Lucid, Tesla of course, which is actually now by market capitalization the largest automaker. um and and Rivian and and and there are there are others and of course there are foreign automakers as well. Uh but the idea that
6:45 the American economy um was always going to be just the three big automakers uh I think there was some arrogance in in in that idea um and and then along comes Tesla right and proves them wrong. So in in the battle of Bunker Hill, the British underestimated the colonial militias. Uh they expected a quick and easy victory and instead they were basically forced to suffer massive losses at the hand of these determined but inexperienced or relatively inexperienced fighters. So, uh, another
7:24 um business another yeah business example um that I think um you know we could we could use is um the fight of or the not the fight but the challenge of Blockbuster by Netflix. So, um, Netflix launched a DVD by mail business in 1997, and it was completely dismissed by Blockbuster, which was, you know, the the huge um video cassette and DVD rental company throughout the country. I think it had 11,000 outlets or something
8:00 like that. It was absolutely dominant. And everywhere you went, you saw Blockbuster Video. Uh and and by by the time that um Netflix had pivoted to streaming in 2007, uh it was too late for Blockbuster and they went Blockbuster went bankrupt in 2010. So uh you know Blockbuster ignored Netflix as this sort of small niche player in you know DVD by mail. Um and they they paid a huge price for that.
8:36 Eventually they were destroyed by Netflix, right? So we we we and and we can look at this from both sides. So if we're the dominant player in the market, we shouldn't get complacent thinking that we're going to always be the dominant player, right? IBM, same mistake. Uh so uh you know, we need to constantly be innovating. We need to constantly be looking at our market competition and we shouldn't dismiss a new entrant merely because that it's a small company. The the the other side of
9:12 that is if we're a small player, that doesn't mean that we can't compete with our larger competitors. We may be able to we may be be able to offer a a more valueoriented price structure because we don't have huge overhead. we may be able to offer more nimble service, more tailored service than a large competitor can. So, there's lots of ways for small organizations, small companies to compete against big ones. Um, we just have to get creative in order to do
9:48 that. So, appearances can be deceptive. Don't underestimate small players and don't underestimate yourself if you're a small player. Okay? So that that's that's the first lesson we can learn. Uh number two is uh strategic positioning beats raw power. So the colonial forces did not try to outnumber or overpower the British. Instead they picked a a strategically or really tactically uh ideal spot to defend
10:24 Breeds Hill. They fortified it and they forced the British to make a costly frontal assault. That was the only way that the British could attack the colonials. Okay? And and as a result, a as I mentioned, the British had over a thousand casualties, right, on what should have been to all appearances just a a quick pitched battle. Disperse the Americans and that's the end of it, right? And so because uh Colonel Prescott had so well
11:00 chosen his strategic position, right, he was able to essentially not prevail per se, but but perform much much better than anybody expected it on on both sides. Right? So um an example of of this is uh is Tesla. So um when when when Tesla um launched its luxury roadster the um in 2008 and then the Model S in 2012.
11:37 So they were really targeting affluent early adopters rather than competing directly with the the three large automobile companies, right? And so by doing so they were able to peel off a small part of the market and and and a part of the market that was more open to this new type of vehicle, right? And so it it wasn't until uh Tesla had um some success under its
12:13 belt that it went more sort of down market, more mainstream. Okay. And and so the strategic positioning that Tesla pursued was to make itself a a um um a a prestige brand. If you remember the early days of Tesla, like they have a Tesla. Wow. you know, now you see, well, at least here in California, you see them all over the place, I think, but I think California has something like 25% of the Teslas in the world or whatever. Uh, but but initially te Tesla was a prestige brand. And it wasn't until it
12:51 really got rolling and really got its production going that it dropped its price point to make it more broadly affordable, right? And so again, we can do the same thing. So, if we're a smaller competitor, one of the ways that we we can compete with a larger uh um with a larger company is to look for a n a niche in which to be involved and and really seek to gain a significant make a significant impact within that niche. Okay, that um and
13:30 then expand from there rather than to take on the large, you know, our larger competitors head-to-head, that's probably not going to be successful. So, um trying to think of another So, if if you if you look at uh Crispy Cream Donuts, why why is Crispy Cream perennially competitive? and and that is um it is the only doughnut company where you know you can wait and and if when the light comes on you know you're going to get a freshlymade doughnut right so they're
14:05 going after they're they have this sort of strategic positioning that we are always the freshest we are always the best right and I think that's what separates um a crispy cream from a Dunkin Donuts or Um I mean donuts have kind of fallen out of fashion but but you know in the stores in donuts or or hostess donuts whatever right? So um you know look to capture maybe a a significant portion of a very of a very niche market at from a strategic positioning standpoint rather than to go
14:42 into a market and overpower it. Okay. All right. So that's that's lesson number two. Um, ne lesson number three, efficiency with limited resources is a competitive advantage. So, uh, the Americans, as I mentioned, had limited ammunition. And so, the troops, the the the the militia men were told, "Make every shot count. Only fire when you're sure you're going to hit somebody." Okay? And and so
15:18 as a result, the the British paid a heavy heavy price really for every inch of ground, right? So rather than just laying down a field of fire as the British attacked, the militia men waited till they got close enough they could pick out individual targets and and and and really make, you know, really make it difficult uh for the British to to get through. So um uh the the example I have from this in a
15:53 in a a business contact is is is Base Camp formerly known as 37 signals. So Base Camp is a project management software and it was launched in 2004. It was launched without venture capital uh and it focused on keeping its it its its operations lean and sustainable and working for long-term profitability. Now, if you know much about the the tech sector, that's an unusual way to handle things. Most tech companies are looking
16:28 to scale up, make a big venture capital raise, and profitability seems to be a a second or tertiary uh consideration at most, right? Be making a big splash, uh gaining as many customers as you can even though you're not making money off those customers. That seems to be the way most companies uh attack uh you know, starting a tech business. But Base Camp did it differently. They were looking to be profitable from the beginning or or as soon as they could possibly be and they
17:04 didn't want to give up ownership to a to a um uh a venture capital firm. And so by working very leanly and very efficiently, right, Base Camp was able to to use limited resources and make them a competitive advantage. And uh talking about a lean organization, America is a maritime nation. Our freedom and security depend on strong sea services. The Beverly Hills Council
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18:17 Battle of Bunker Hill that happened 250 years ago today. looking at lessons we can learn from the um the tactical loss but strategic victory that the American militia men accomplished um on on on this day on on actually what was Breed's Hill. So um we I' I've talked about um uh first of all appearances can be deceptive. So don't estimate smaller players. Uh number two,
18:53 strategic position beats raw power. And number three, being efficient with limited resources can be made a competitive advantage. Okay. Um so next is uh number four and that is tactical winds aren't always strategic victories. So the British captured the hill but they paid a big cost and that victory weakened their army not only from from a a manpower perspective but I think also
19:28 from a morale perspective so that they were expected to just overrun the American positions easily and instead um had such huge losses uh against these relatively unbattle tested did American colonials I think had had a negative impact on the belief by British soldiers uh that they that they you know could could beat the Americans. And so, um, at the same time, even though the Americans
20:04 lost, they were emboldened, um, because they saw that with the right tactics and and and if as long as they operated efficiently, they could be an effective force. And and George Washington knew that he he didn't have to win, okay? All he had to do was not lose. And of course, those are not the same thing. We tend to think of not losing as as being winning. No, not losing is just not losing. Winning is is winning, right?
20:40 So, um there was a morale shift as a result of the Battle of Bunker Hill and and that that played into America eventually prevailing uh in in the war for independence. So, excuse me. An example of this on the business in the business world is uh Uber. So, uh Uber uh it very aggressively entered global markets including China and Southeast Asia and it gained uh temporary market share. Um
21:16 but eventually it it had to exit many of those same re uh regions because of local uh resistance to Uber and also financial losses. So um what were initially tactical victories on the part of Uber and getting into numerous markets around the world actually ended up being a strategic defeat as they ended up having to abandon those markets and and essentially lose out on the
21:52 investments they had made there. um uh you know the the the monetary investments they had made there, right? So Uber most likely would have been better off being more selective about the markets it entered and in ensuring that it had enough firepower so to speak to be successful in those markets. Now I think Uber was concerned about competitors like Lyft for example coming
22:30 in and getting a jump on them and so that's why they followed the strategy they followed but in the end that that concern uh proved well it's not that it it proved wrong it's just that their their strategy for broadbased uh aggressive of expansion proved to be as bad a strategy as what might have happened if a competitor had come in and and and it's it's probably likely that if an a competitor had tried to conquer those markets before Uber they would
23:06 have suffered the same fate as Uber right so being first in is is it may be a tactical victory but it doesn't always lead to broader more strategic success. Okay. So, you know, I think um there's always the pressure to grow and and and all of that. Um but as I've mentioned many times on on this show, uh oftentimes the first per the first organization into a particular area is not the one that gains long-term success. The the classic example that
23:43 I've mentioned before is MySpace versus Facebook, right? So MySpace predated Facebook by I think a year or two. Um and yet I don't I don't even think MySpace exists anymore. Certainly nobody cares about it. Whereas Facebook is one of the largest companies in the world, right? So so that that's the same tactical wins are not the same thing as strategic victories. Okay. Uh number six. So know when to retreat and regroup. So uh when the Americans
24:21 were realized they were running out of ammunition rather than suffer complete destruction they beat a tactical retreat. And of course that was the smart thing to do uh to preserve their forces for future battles. And although it was it was Colonel Prescott who was the the commander that so aly led the Americans at at Breed on Breeds Hill, uh George Washington who became the commanderin-chief of the American colonial army. He was incredibly adept
24:57 about fighting and then sort of making a a a tactical or strategic retreat so that he would maintain his forces to fight another day. So uh it I I it would be I think reasonable to say that uh despite losing most of the battles that he fought still uh George Washington ended up winning the war and that's because he knew when to retreat and regroup uh and rather than just stand and fight and and having his men get get wiped out. There's there's there's no
25:32 upside to doing that. So, um, an example of this is, uh, Amazon's Firephone. I don't know if you if you even have heard of this device. I when I was doing my research for this show, I came up with this is one of the things I came up with and I'm like, yeah, I vaguely remember hearing something about it. Right. So, uh, in July of 2014, u just about 11 years ago, Amazon launched the Fire Phone Fire phone and it absolutely flopped. It got poor reviews. The this the sales were weak
26:09 and rather than continuing to pour money into a product that it seemed evident that consumers did not want. Um by August 2015, just a little over a year later, um Amazon discontinued the phone and and they they cut their losses and walked away. They they made a strategic uh a strategic retreat. Um and they have not re-entered the phone market. Uh and and that's I think that that that decision makes sense uh to me
26:44 certainly. Um being in the phone business is different. the phone business is fundamentally different from Amazon's business and but it did go on to focus on more successful pro products like Alexa right and and Alexa is an enormously successful product so by by uh retreating and regrouping at the proper time uh Amazon was able to uh not waste resources um and could turn them to a a a better more productive use,
27:23 right? And so I think, you know, we we don't want to get lost or we don't want to get uh sucked in by the uh sunk cost fallacy. So the co sunk cost fallacy basically goes like this. Okay. Well, I'm I'm working on this new initiative. I've already spent $10,000 on it. I might as well spend another thousand on it uh to to to try and make it successful. Now, often times that is a very bad idea. If you've spent what you've spent and you're still not successful,
27:59 you know, it there it many many times the right decision is just to take cut, you know, cut your losses, just absorb them and move on rather than putting even more money into a venture that's just not going to succeed. So don't let yourself get get deceived by the sunk cost fallacy. better to look at the the the venture, the product, the service objectively. Is this really doing what I thought it would do? And if the answer is no,
28:34 cut your losses, get out like like Amazon did with with the Firephone. So that's number six. Uh know when to retreat and regroup. And then finally, number seven, symbolic victories can energize uh shareholders. it can energize partners and employees, right? And and and that's is that's exactly what happened as a result of the Battle of Bunker Hill. Uh the the while the colonists lost the battle because uh they had to retreat and the British
29:11 took over the position on the hill. In the end, so what? The Americans didn't need to have the hill. Uh and they weren't going to attack it. So let the British have the high ground. Um but by making the British pay so dearly for it, the they the colonists created a significant morale and momentum shift in the war and eventually albeit eight years later uh the the colonists uh prevailed and and so
29:46 symbolic victories can energize uh the people involved even though they there there was an action ual loss, it becomes a symbolic victory. So, um, Apple's 1984 launch of the Macintosh sort of fits into this. So, uh, in in 1984 for the Super Bowl, Apple, um, played an ad for the Macintosh. And, um, so, um, um, sorry, I'm I'm I'm looking at my notes here because I I was
30:21 remembering it differently than I have it in my notes. One moment. Oh, right, right, right, right. Okay. Yeah. So, so they they chose this very highprofile launch of this new product, right? And it it it was it was really more symbolic uh than it was actual. Apple did not have the rabbid fan base that it has today, not anything like it. And in fact, the launch of the Macintosh
30:56 really was the beginning point that eventually led to the kind of market dominance that Apple has and the kind of loyalty among its customers that that Apple has. And and so as a result and and even back in 1984, Super Bowl ads were a big deal. So, it really energized Apple's brand, its employees, its customers, and it laid, as I mentioned a moment ago, the groundwork for what became a
31:31 tremendously loyal customer base that we see today and Apple becoming one of the most valuable companies in the world. Okay. So, uh, you know, just because a victory is just because a a victory is doesn't look like what we thought it would look like, doesn't mean that it's not a victory. So, the colonists getting kicked off Breeds Hill, it didn't look like a victory, but indeed it was because of how the overall situation
32:07 played out. And so as we run our businesses and professional practices, we need to keep that in mind as well. Now again, we need to know when to retreat and regroup and not keep throwing, you know, good money after bad. Uh but by the same token, as long as we're not losing money, uh what may otherwise look like a small victory or even a defeat, um may indeed be a much bigger boost to our company,
32:43 our organization than we thought if we can follow it up with some more small victories. And that's that's essentially what the the colonists did throughout the American Revolution. And we can do the same thing in business. So a series of small but but worthwhile victories uh for for a small company generally speaking will be better than some big large flashy victory that it's unlikely we're going to able be able to replicate. And I I know for myself
33:22 uh I I look for I look for small wins if I can get them and and and have cons consistent small wins uh rather than you know one home run once a year or once every two years. So that's what a successful business looks to build. Okay. So those are the lessons that we can learn from the battle of Bunker Hill. Uh reviewing them one more time. Appearances can be deceptive. So don't underestimate small players. Don't underestimate yourself if you are a small player. Number two, strategic positioning beats raw power. Uh number
33:58 three, efficient efficient use of limited resources is a competitive advantage. Number four, tactical wins aren't always strategic wins. Okay? So the it is just because we win a battle doesn't mean we're going to win the war. Number six, uh, know when to retreat and regroup. Actually, that's number five. I realize my my count is off here. Okay, so number five, know when to retreat and regroup. And number six, symbolic victories can energize our team, our
34:33 customers, and we can um we can do much better uh with a series of of smaller victories, especially if they're laden with symbolism than m than pursuing that one big home run. So, I thank you very much for joining me today and especially my live viewers. Always good to see you. And tomorrow at 10 on Wednesday at 10:00 a.m. Pacific time is my show People Making Money. And
35:09 I think we're due for Yes, we'll we'll be having our monthly economic echoes, looking at the monthly economic data and seeing how it's going to affect uh ourselves and our families. Okay. And then on Wednesday, uh, sorry, on Thursday at 5:00 PM is my every other week show, Jiggers's Place, and we're going to be having a cocktail and talking about the famous detective, Sherlock Holmes, and his and of course
35:45 the author, Sir Arthur Coin Doyle. So uh please join me Thursday afternoon evening depending on where you are uh and uh for for for a cocktail and uh a chat about uh the the the you know great great fictional detective Sherlock Holmes. And then on Sunday, June 22nd is a special edition of the Way to Wow Show. it it is the um uh anniversary of the pledge of allegiance. And so, as I
36:20 do on all the special editions, I'm going to be talking about how the pledge of allegiance came to came into being and and and do a reading or two uh in honor of the day. And then uh then technically Sunday is next week, but then next week is my regular slate of shows. on Monday is Trust and Estates Weekly and my guest is uh Derek Keller and on Tuesday uh a week from today on Business Lessons
36:55 from the Military, my guest is Darren Burrell. So, I've got, you know, lot of shows coming up. I hope you'll join me for all of them. wishing you. Oh, and if you have any uh questions, comments, criticisms, all the all the um uh social media links, we'll post uh on YouTube after this after this uh episode posts. So, invite you to to share those. And uh and that and then wishing you a wonderful rest of the day and signing
37:30 off as I always do. Marie darling, you are my bell. Courage at all times, my friends.