Apply Five Factors Assessment

---
name: apply-five-factors-assessment
description: Use when preparing for any competitive engagement — product launch, market entry, negotiation, or campaign — to audit your position across the five strategic dimensions before committing resources
source: Sun Tzu "The Art of War" Ch.1 (Giles trans. 1910; Griffith trans. 1963); Porter "Competitive Strategy" (1980); US Army Field Manual FM 3-0 "Operations" (2022)
tags: [assessment, competitive-analysis, five-factors, sun-tzu, art-of-war, market-entry, decision-making]
verified: true
---

# Apply Five Factors Assessment

Before committing to any competitive engagement, audit your position and your opponent's across the five strategic dimensions — 道天地将法 — and engage only where you hold an advantage in the majority.

## Why This Is Best Practice

**Origin:** Sun Tzu opens *The Art of War* with this framework because he believed the outcome of every conflict is determined before it begins, by the relative standing of the two parties across these five dimensions. "The general who wins a battle makes many calculations in his temple before the battle is fought. The general who loses a battle makes but few calculations beforehand." (Ch.1, Giles trans.)

**Adopted by:** The five-factor framework is taught at West Point, the US Army War College, and in MBA strategy curricula as the foundational pre-engagement audit. McKinsey's strategy practice centres on "where to play and how to win" assessments that map directly to this framework. Amazon's PR/FAQ process (write the press release before building the product) is an operationalisation of the assessment-before-commitment principle.

**Impact:** Most strategic failures can be traced to committing resources before completing an honest assessment — overconfidence in one factor while ignoring weaknesses in others. The five-factor audit forces explicit scoring of each dimension and requires that the overall balance favours engagement before proceeding.

**Why best:** The framework is not a static checklist — it compares your position against a specific opponent in a specific context. A factor that favours you in one market may not in another. The comparative, context-specific scoring prevents the common failure of absolute self-assessment ("we have great people") without accounting for the opponent's standing on the same dimension.

Sources: Sun Tzu, *The Art of War* (Giles trans. 1910) — Ch.1 (Laying Plans); Sun Tzu, *The Art of War* (Griffith trans. 1963); Porter, *Competitive Strategy* (1980) — five forces as terrain assessment; US Army FM 3-0, *Operations* (2022) — mission analysis framework

## Steps

### Step 1: Define the engagement precisely
Before scoring, name the specific engagement: a particular market, product category, customer segment, negotiation, or campaign. The five factors are always assessed relative to a specific opponent in a specific context — not in the abstract.

Write down: "We are entering [market/negotiation/campaign] against [opponent] for [specific objective]."

### Step 2: Score 道 — Moral Law (alignment and mission)
**The question:** Do your people believe in the mission? Will they follow through hardship without breaking? Is your opponent's team aligned or fractured?

Score 1–5 for you and your opponent:
- 5: Deep mission alignment, high morale, low attrition, people go beyond their job description
- 3: Adequate commitment, typical corporate motivation, execution follows incentives
- 1: Mercenary culture, high attrition, conflicting internal agendas, poor morale

**Modern translation:** 道 maps to culture, mission clarity, and team cohesion. A startup with a clear mission often outscores an incumbent on 道 despite being outmatched on every other factor — and this is why startups that "shouldn't" win sometimes do.

### Step 3: Score 天 — Heaven (timing and environment)
**The question:** Are external conditions — timing, macro environment, regulatory climate, technology cycle — favouring your engagement now?

Score 1–5 for the environment relative to your position:
- 5: Market timing is ideal; regulatory tailwinds; technology cycle on your side; competitor weakened by external events
- 3: Neutral environment; timing is acceptable but not exceptional
- 1: Poor timing; macro headwinds; regulatory pressure; technology cycle favours the incumbent

**Modern translation:** 天 maps to market timing, macroeconomic conditions, and technology S-curves. Entering a declining market is fighting in adverse weather. Entering when the technology cycle is disrupting the incumbent is fighting with the wind.

### Step 4: Score 地 — Earth (terrain and market structure)
**The question:** On what ground is this battle being fought? Who does the terrain naturally favour?

Score 1–5:
- 5: The terrain clearly favours you — your distribution channels, geographic strength, customer relationships, or technical platform are better suited to this market
- 3: Neutral terrain; both parties have access to the same ground
- 1: The terrain clearly favours the opponent — their existing distribution, brand awareness, or switching costs make the ground their home court

**Modern translation:** 地 maps to distribution channels, geographic presence, customer relationships, and platform effects. Don't fight where your opponent is entrenched without a terrain-changing move (a new channel, a new segment, a regulatory shift that levels the ground).

### Step 5: Score 将 — Commander (leadership quality)
**The question:** Whose leadership team makes better decisions, faster, with greater adaptability?

Score 1–5 for your leadership vs. theirs:
- 5: Significant leadership advantage — proven track record, faster decision cycles, better judgment, lower commander faults (see `apply-tactical-adaptation`)
- 3: Comparable leadership; outcome will be decided by execution
- 1: Leadership disadvantage — slower decisions, more political friction, less experienced

**Modern translation:** 将 maps to executive team quality, decision-making speed, and organisational coherence at the top. A better-resourced opponent with slower, more political leadership can be beaten by a smaller, faster, more decisive team.

### Step 6: Score 法 — Method (organisation and discipline)
**The question:** Whose systems, processes, and execution discipline are superior?

Score 1–5:
- 5: Superior operational systems — better data, better processes, more disciplined execution, shorter feedback loops
- 3: Comparable operational capability
- 1: Operational disadvantage — fragmented systems, poor execution consistency, long feedback loops

**Modern translation:** 法 maps to operating systems, data quality, execution discipline, and organisational structure. A company with better sales processes, customer data, or engineering deployment cadence has a 法 advantage that compounds over time.

### Step 7: Score and decide
Build a simple comparison table:

| Factor | You (1–5) | Opponent (1–5) | Edge |
|--------|-----------|----------------|------|
| 道 Alignment | | | |
| 天 Timing | | | |
| 地 Terrain | | | |
| 将 Leadership | | | |
| 法 Method | | | |
| **Total** | | | |

**Engagement threshold:** Proceed if you hold an advantage in ≥3 of 5 factors. If you are at 2–3 neutral and 2–3 disadvantaged, do not engage until you change the factors.

**How to change a factor:**
- 道: Recruit mission-aligned people; clarify the why
- 天: Wait for better timing; catalyse an external change
- 地: Open a new channel; enter a sub-segment where the terrain is different
- 将: Upgrade leadership; improve decision-making structure
- 法: Build better systems before competing

## Rules

- Never assess yourself in isolation. Every score is comparative against a specific opponent in a specific context.
- Score honestly. Overrating your own factors is the most common failure mode. Have an external party validate your scores.
- Reassess when the context changes. Factors that favoured you last year may not this year — timing (天) especially changes fast.
- Do not proceed on a single dominant factor. A 5 on 道 does not compensate for 1s on 地 and 法. The framework requires multi-factor advantage.
- The assessment is a go/no-go gate, not a guarantee. Favourable factors improve probability; they do not determine outcome.

## Examples

**Startup entering an incumbent's market:**
- 道: 5 (mission-driven team, low attrition) vs. 2 (incumbent has cultural drag)
- 天: 4 (AI cycle disrupting incumbent's product) vs. 2
- 地: 2 (no distribution) vs. 5 (incumbent has dominant channels)
- 将: 4 (fast decision-making founders) vs. 3
- 法: 3 vs. 4 (incumbent has mature operational systems)
- Total: You 18, Opponent 16 — marginal advantage. Proceed, but through a new channel (地 gap is critical risk). Do not fight on incumbent's terrain.

**Enterprise sales deal (competitive pitch):**
- 道: 4 (team believes in the product) vs. 3
- 天: 5 (prospect's incumbent just had a security breach — timing is exceptional)
- 地: 3 (neutral — neither has prior relationship with this buyer)
- 将: 4 (better executive sponsor) vs. 3
- 法: 4 (better sales process, case studies ready) vs. 3
- Total: You 20, Opponent 12 — clear advantage. Commit full resources to this deal.

## Common Mistakes

**Assessing factors in absolute terms:** "We have a great team" scores nothing. "Our team makes decisions 3× faster than the incumbent" scores 4 on 将. Always compare.

**Skipping 天 (timing):** Most strategists assess capabilities and ignore timing. Entering a market at the wrong point in the technology cycle can make strong 将 and 法 irrelevant — the tide overwhelms the swimmer regardless of swimming skill.

**Treating the assessment as one-time:** The five factors are dynamic. Re-run the assessment when a major variable changes (competitor funding round, regulatory shift, technology release, leadership change).

**Using the framework to justify a predetermined decision:** Score honestly and let the scores determine whether to engage. If you find yourself adjusting scores to justify a decision already made, stop — you have skipped the assessment and are doing rationalisation.