What Machiavelli Can Teach Us About Business Philosophy & Leadership

Niccolo Machiavelli's 'The Prince' was written in the early 16th Century while he was living in exile, as a gift to Lorenzo Medici — de facto ruler of the Florentine republic — arguably as a means to earn his place in society as a statesman again.

This book has some jagged edges but when we discussed at the office what book best describes a business philosophy, this is the one that rose to the top of the list. I just ask you to keep an open mind and reflect on how this book genuinely does reflect a business philosophy we can all learn from. Yes, it’s a little dark but keep an open mind and unleash your inner literary nerd like we did!The Prince is to this day considered one of the earliest works of modern philosophy, and indeed of modern political philosophy, and spawned the term Machiavellian in reference to cunning and unscrupulous behavior, especially in politics.

While the book only numbers some 120 pages, it is full of lessons that one can apply to leadership, business, and, more broadly, life.

With that, find below several key excerpts I've extracted from The Prince and how they relate to business and leadership in the 21st Century.

"My life is so ordinary and dull. I spend hours to chop down fuelwood and pass considerable time with the woodcutters who are never without some problem or trouble."

Machiavelli could just as easily be referring to peasants as he could any random person in our extended circles today. People are always complaining about one thing or another. As a leader, it's essential to be aware of this fact, maintain a distinguished positive disposition, and empower people to focus on the positives.

Acquiring Businesses and Joining Teams

"Anyone who conquers such territories and wishes to hold on to them must do two things; extinguish the ruling family, and alter neither the laws nor the taxes."

If you have assumed control of a business or team, you should extinguish loyalty to the previous leadership and initially avoid shaking things up too much.

"One of the best and most ready solutions is for the new ruler to reside there. This expedient would make the new position safer and more lasting, as it did for the Turk in the case of Greece.

The next best solution is to send colonies to one or two places which would serve to shackle that state."

If you have acquired a business, make sure that you — or trusted representatives, make their physical presence known so that seeds of discontent are not sewn.

"The difference does not arise from the greater or lesser ability of the conqueror, but from similarities in the conquered lands."

If you are acquiring a business or joining a team, similarities and synergies between the environment you're stepping into, and your past experience, existing resources, and networks will give you a significant advantage and increase your chances of success.

"When a State accustomed to live in freedom under its own laws is acquired, there are three ways of keeping it; the first is to destroy it, the second is to live there in person, and the third is to let it continue to live under its own laws, and set up a government composed of a few men will keep it friendly to you."

When larger organizations acquire SMEs, they often inadvertently destroy the company by absorbing it into the mothership. If the acquiree was acquired for its strengths and growth opportunities, then an arm's length relationship should be established, with the acquiree free to work the way that made it a valuable acquisition target in the first place.

"Strengthen the weak, and weaken the powerful."

A prince who occupies a province that differs from his own must become the leader and defender of the less powerful neighboring states and seek to weaken the more powerful among them. A prince must also be on guard by any chance some foreigner equal to him in power should enter them. Such an event always comes about through the help of discontented inhabitants who willingly admit a foreign power through excessive ambition or fear, as was the case with the Italians, who let the Romans into Greece.

On Change and Innovation

"When ills are recognised in advance, they are quick to remedy. But when, having gone unrecognised, they're allowed to increase until everyone may recognise them; then remedy is no longer possible."

If you wait until you have a 'burning platform' before you invest in innovation, you've waited too long because, by that point, you're either burning alive or jumping into the freezing waters below.

Burn or freeze. Yikes.

"In order to avoid a war, the war is not avoided thereby but merely deferred to one's own disadvantage."

We tend to avoid that which we most need to do. It's easy to defer difficult conversations and decisions because it's comfortable and mitigates tension and stress in the short term, but by leaving problems to stew, they only get bigger and cause us more pain down the line.

For example, if you've got a problematic employee, you can either have an honest conversation upfront and attempt to correct their behavior or let them continue to underperform for months on end at a detriment to the team, the business, and your leadership.

"The affairs of the world are so changeable that it is impossible for an opponent to keep an army idol in the field for a year."

Thanks to the exponential change that Moore's Law has delivered, the world is changing faster than ever. As such, five-year plans no longer make sense, and leaders must shorten the feedback loop of their business models significantly and ensure that their workforce's strategy and behavior adapt with the times. To stand still is to perish.

"It is a common feeling of men not to take account of tempest during fair weather. The Prince is successful when proceeding with the times and is unsuccessful when his mode of proceeding is no longer in tune with them."

20th Century management literature worked well…in the 20th Century. But the rules of the game have changed today, and the firm's economics are shifting thanks to both technology and lower external transaction costs. To succeed today, one must ensure that they are using updated maps to navigate the terrain.

Your People Make You a Leader

"The man who becomes Prince through the help of the nobles will find it more difficult to remaining power than the man who becomes Prince through the help of the people, for the former will be surrounded by men who presume to be his equals. As a consequence, he will not be able to control them as he would like."

We see this play out all the time during political party spills, in which a new party leader is nominated by fellow politicians. Such arrangements rarely last long.

Hired Guns and Outsourcing

"Mercenary forces are useless and dangerous; and any ruler who keeps his state dependent upon mercenaries will never have real peace or security, for they are disorganized and undisciplined. The reason for all this is that they have no type of devotion, no motive for taking the field except their meager pay, and this is not enough to make them willing to die for a Prince."

Only outsource non-critical tasks. Don't expect mercenaries or hired guns to deliver what one of your own would, what somebody with skin in the game (e.g., equity) would.

"A large body of infantry is impossible to feed and a small one insufficient to make a mark."

Optimize the size of your organization and the size of your teams so that they are large enough to create impact but not too large that they fall victim to Brooks Law (below) and process paralysis.

"Having grown accustomed to fighting with the Swiss, the French now believe that they cannot win without them."

Watch out for your dependencies — be they software or people. What would happen if one of them were to fail for whatever reason? What are your backup plans? Can you or your business stand on its own feet?

"No state unless it has its own arms is secure. It is a hostage to fortune."

When it comes to your business or your content, are you at the mercy of a third party? What if those third parties went out of business tomorrow? Could you still move forward? There are numerous examples of API-driven companies going out of business because the related applications cut off their API support. Similarly, if you've built a name for yourself as an influencer on Instagram, who's to say there won't be another social media platform to take its place in several years? Own your arms — at the very least, build a mailing list and have backup plans for your software assets in place!

Virtue

"Men of little prudence will do a thing for an immediate game without recognizing the poison it bears for the future."

In a world of short-term shareholder sentiment, it's easy to fall victim to optimizing numbers for dividend payments at the expense of the long-term health and growth of the business.

Similarly, as human beings, we are all susceptible to instant gratification; but the thing about instant gratification is that, in most of its forms, it takes us further away from our goals than closer to them.

"The Prince must have no other objectives, no other thought, not take up any profession but that of war, it's methods and it's discipline. That is the only are expected of a ruler."

If one is focused on building a unicorn, they will have little time to get good at other pursuits. They should invest themselves, almost entirely, to that one cause. Of course, this is relative to the size and ambitions of the business.

"The Prince who is ignorant of military matters will find that he cannot have the esteem of his soldiers and cannot trust them."

The leader overseeing, say, a software business must at least have a basic working knowledge of how the software works if he is to have meaningful conversations and earn the respect of his software developers.

"There can be no knowledge without retention." — Dante.

The Italian poet put it succinctly. While the modern leader and entrepreneur might like to read and listen to podcasts ad infinitum, it's easy to confuse all of this consumption with learning, when often it amounts to short-term ego gratification at the expense of retention. If you are consuming content, make sure to apply techniques to retain the content and apply that knowledge to achieve admirable ends.

A leader should strive for Machiavelli's virtù — physical and mental capacity, skill, courage, and vigor.

Fortify

"Never submit to idleness in time of peace, but rather endeavor turn such time to advantage so as to profit from it in adversity. Thus when fortune turns against him, he will be prepared to resist it."

It's easy to become complacent when things are good, but one should fortify a business against adversity by ensuring that considerable financial resources are available and that the business, and its people, can triumph in times of dire need.

Strategy

"If the enemy were on that hill and we had our army here, which would have the advantage? How could we advance on them in good order? If we wish to retreat, how would we go about it? If they were to retreat, how would we pursue them? This kind of deliberating ensures that a prince has no problem for which it does not have a solution.

Men should be sufficiently prudent to avoid a reputation for vices which would deprive him of his state and if possible, avoid those that would not deprive him of it."

Well, the removal of Travis Kalanick at UBER colorfully embodies this excerpt. Remember that?

"The Prince must adopt a beast like nature — that of the fox and that of a lion; for a lion is defenseless against snares and the fox is defenseless against wolves. Any Prince ought to be a fox in recognizing snares and a line in driving off wolves."

Play the role that is fit for the circumstances you find yourself in.

On the Narrative Fallacy

"Two men might using different methods can achieve the same results, and two others using similar methods can achieve country results. This has to do with the character of the times."

Business books are full of advice based on anecdotal evidence about what worked for a specific person or company. But in reality, the strategy or tactic employed probably only worked because of the unique circumstances at play.

Ensure your strategy and tactics are helpful for your unique circumstances.

The crane kick worked for Daniel Larusso in The Karate Kid, but not so much in the sequel!

Building and Leading Teams

"Men judged by the eye rather than the hand, for all men can see a thing, but few come close enough to touch it. All men will see what you seem to be, and only a few will know what you are."

Be impeccable with both your words and your actions. If you want your people to behave a particular way, lead by example, for people model what they see rather than what they hear or are told to believe.

"By arming your subjects, you make them their arms your own."

Develop your people. Invest in their knowledge, capability, and growth.

"Nothing wins so much esteem for a Prince as embarking on great enterprises and giving reference to his ability."

Pursue big, hairy, and audacious goals if you are to draw the esteem and admiration of your people.

"If you burden the many and reward only the few, you will feel the disadvantage of your position at the slightest sign of trouble, and you will be exposed to danger."

Incentivize your people fairly, and ensure that they all feel valued and rewarded according to their efforts.

"Every Prince ought to wish to be considered kind rather than cruel. Nevertheless, he must take care to avoid misusing his kindness."

Be a good human, but don't be a pushover; don't avoid transparent conversations, and don't allow poor performance to fester.

"It is best to be both loved and feared. The greatest security is in being feared rather than being loved."

Steve Jobs is the quintessential example of a leader who was both loved and feared by his people. He often brought the best out of them, but it was not without a voracious appetite for perfection and an immovable vision that often left his people perplexed.

Steve Jobs was both loved and feared.

"In duels, few men are superior to Italians are in strength and in skill. When it comes to armies, Italians do not show up well."

A team of champions is no substitute for a champion team, built upon a foundation of an empowering and high-performance culture.

"Only the good will of the people is vital to a Prince, otherwise he will be helpless in times of adversity. He who builds on the people builds on mud. A Prince must provide in such a way that in whatever circumstances the citizens will always need him and his government. Then they will always be loyal."

Move Fast

"One action has grown out of another with such rapidity that there has never been time in which men could quietly plot against the Prince."

If your feedback loop is shorter than that of your opponent's, you will inevitably win.

On Capitalism

"A Prince should also demonstrate that he loves Talent by supporting men of ability and by honoring those who excel in their craft. He ought to encourage citizens to pursue their affairs, whether in trade, agriculture, or any other human activity, so that no one will hesitate to improve his position for fear that his assets will be taken away from him. Instead, the Prince ought to be ready to reward those who do these things and those who seek out ways of enriching his city or state.

The Prince's intelligence will be based upon the character of the men he keeps about him."

As Jim Rohn said, "you are the sum of the five people you spend the most time with." So too, will be people's interpretations of your character.

So there you have it! When put side-by-side with a modern context some serious lessons on business philosophy and leadership reveal themselves... even if it is a little uncomfortable