A beautiful November is unfolding its autumn expressions for all of us. Eleonora Escalante Strategy rejoices with this season, and today we will share the findings that we have been researching, studying, and analyzing for you.

As it will be our norm from now and then, we will share with you our framework of reference first. Please take your time to read the slides that we have carefully prepared with tons of dedication and devotion for your mind. We wish you to become critical meditative thinkers. So, please download the material below, or share it, and print it. Look for more sources that will validate our assumptions, hypotheses, and inferences in each slide.

Strategic Reflections for Episode 15.

The philosophical premises of the Enlightenment are numerous.
At the beginning of August, we dedicated three episodes to learn about the 4 main canons of the Enlightenment: Radical, Moderate, Despotic, Counter-Enlightenment. The philosophical premises of each canon shared certain aspects, but at the same time were quite separate and unique. If you wish to revisit these premises´ content, I encourage you to click Episode 3, Episode 4, and Episode 5A of Season III. The format of the radical enlightenment which grew clandestinely was the one that first got tested in real life during the French Revolution. We also have discovered, and more and more, we believe that the French Revolution was a strategy to block the Bourbons in their plans for strengthening the expansion, colonization, and settlement of New Spain (also called Spanish America) and the Spanish Territories in North America. Why do we think this way? Right previously the French Revolution, Charles III, the Bourbon Emperor of Spain, and King of Naples and Sicily died, but he left a strong enlightenment agenda for his successor. Charles III had close ties with Italy, he resided in Naples for 19 years, so he got enlightened through the freethinkers of that region. He saw these reforms in Italy and prefigured which would be important to put in place in Spain and its colonies. His ambitious plans included changing the whole colonization structure of the decentralized Habsburg model of colonization in Spanish America.  Charles III of Spain consolidated the Bourbon Dynasty firmly, and he “renewed the Spanish belligerence in Europe, by breaking the Spanish neutrality in the Seven Years’ War”. The Spanish military and naval power was kept almost intact in the middle of this war because the previous Bourbon kings to Charles III harvested the strategy of the Spanish Habsburgs´ kings: the Spanish empire had the capacity to efficiently siphon the resources of its colonies to finance the metropolis´ military spending.

Despite that gold wasn´t available everywhere in Latin America, silver and other precious stones such as jade were highly significant. Additionally, the diversification of other agricultural crops such as sugar, cocoa, tobacco, cotton, and textiles tints (such as indigo and red dye cochineal). “The contributions of products from New World mines yielded far greater amounts than France and Portugal had ever been able to extract from West Africa”.  “South German mining engineers (sent from the Austrian Habsburg territories) greatly contributed to the transplantation of European technology to the Americas, and the Spanish-American silver mines utilized the new mercury amalgamation method to extract refined silver from the raw ores”.

The Habsburg kings decentralized the authority keeping strong efforts to maintain close control through its Spanish agents in several Viceroyalties, and through the Municipal Councils or Ayuntamientos.  The Habsburgs’ organization of the colonies took more than 200 years to get in place, and they were interested in extracting gold. When the Bourbons arrived at the Spanish throne, the first priority was to oversee the lands in the New World, and they found that the Habsburgs’ lands were not stitched, but weakly stuck with nothing. The Bourbons encountered two main social classes in Spanish America: (1) Two small upper-aristocratic groups: The Spanish Administration officials and the Spanish ecclesiastical authorities; and the Creole Landholding elite. There was no middle class. And (2) the second class was a large mass of Indian mestizos, with an ample range of occupations: craft workers, rural laborers, artisans, provisioners, and wage helpers, without land. The model of the large haciendas in feudal style, was of self-subsistence, raising cattle, grains, and crops for the patrons and for the local population.

The Habsburgs’ organization of the colonies was completely different to what the Bourbons wanted to accomplish, the ties of the new Spanish Bourbon emperors to France were non-official but strong enough to be “in the family”. The efforts of the Austrian Habsburgs to keep closer to the Bourbons continued all through the 18^th century in Europe, and it seems to me that they wanted to keep Europa Regina together by convenience, or until they could, before Britain and the Dutch may breach the former Spanish Habsburg Colonies in America. Maria Antoinette was a Habsburg member married to the Bourbon Louis XVI. This is evidence of what we are trying to explain. But Maria Antoinette wasn´t able to help France, nor herself either. The greater Spanish America was so vulnerable to any of these opponents. Britain was already settled in the 13 British Colonies of North America and Canada, and their advances in Central America and the Caribbean were perceived much more during the 18th century.  It is here that we come to encounter the conflict of the Seven Years’ War (1754-1763) together with the French Indian Wars, followed immediately by the American Revolutionary Wars (1775-1783). See slide number 7.

The Spanish Habsburg administration in America was in the process of being deconstructed.
During the 18th century, the Bourbon kings (Philip V, Ferdinand VI, Charles III, and Charles IV) introduced policy changes known collectively as “Bourbon Reforms”.  According to K. Andrien, the Bourbon reforms wished to curb smuggling commerce, regain control over transatlantic trade, curtail the church´s power, modernize state finance to fill depleted royal coffers, and establish tighter political and administrative control within the Bourbon Empire. That is why this century is usually called the “Second Conquest of America” (Lynch 1975). Were the Bourbons successful? We don´t think so. Spain didn´t want another war, but the Bourbons were trying to gain time (without wars in their colonies) to demolish the Habsburg´s structure in America. They couldn´t do it. The French Revolution and the Napoleonic wars only triggered the Independence movements in all of Latin America between 1800 to 1830. In the 19th Century, Europa Regina was sourly gone.

We also have inferred that coincidently, at the same time, during the 18^th century, every single war occurring in Europe was linked to wars occurring in the new colonies. Nothing that occurred in the colonies was an isolated event because colonies were inherent parts of each of the empires competing in between for conquering claims in America, India, Africa, and Asia.  Apparently, during the whole 18th century, it was the moderate Enlightenment that took the stage within the nobility class in every single main country in Europe (nobility of robe, nobility of sword, nobility of cloche). Possibly, the activities of the absolutist despotic enlightenment rulers to relax their oppressive policies, petit a petit, were just the beginning of dethroning the Empire of the Habsburgs (Holy Roman Empire) in the New World.

Now let´s focus our attention on the 18^th century of the Enlightenment in Europe.
The radical enlightenment was hidden, underground, budding behind the walls of the Inquisition not just in Europe, but also in the New World; the moderate enlightenment was being spread as much as it could through the Leibnizian or pro-Newton principalities of Germany and the Holy Roman Empire region. The moderate Enlightenment was also accepted in real life through the implementation of the Bourbon reforms in Spain, Spanish America, Austria, Prussia, Russia, and the kingdoms directly associated with Spain or the Papacy: Naples, Sicily, Sardinia, Milan, Tuscany, & Rome. In addition, the counter-enlightenment was being played mainly as the response from the Catholic Church representatives, first to shut down the Enlightenment philosophers and free-thinking authors, and later to adapt to the moderate enlightenment wing. By supporting the despotic enlightenment, the Catholic Church thought it could survive.

The four canons of the Enlightenment were dancing back and forth, through the Republic of Letters. In the meantime, the freethinkers from England and Scotland weren´t sleeping at all. Meanwhile, the American independence wars were taking place between 1775 to 1783; Charles III, the Bourbon king before the French Revolution, wanted to keep his territories intact in America, an odyssey that Charles IV couldn´t preserve.
Two possibilities come to our mind: (1) Were the Austrian Habsburgs sponsoring the movements of independence in America to get rid of the Bourbons? or were the Independence revolts provoked by the same Habsburgs as the only way to save Latin America from the other Empires subjection (France, Britain, United Provinces of the Netherlands). See slide number 8. (2) We also wonder if there was a three-musketeer strategy of these three main non-Spanish empires all in conjunction with the Creoles (all for one and one for all) trying to design a society that was emerging with independent ambitions that wished to be free of the Old-Europe regime of monarchs and start fresh new in America.  We believe that given the legacy of decentralization of the Spanish Habsburgs in America, both possibilities may have occurred.

Look at the before and after the French Revolution in the New World.
Slides from 9 to 13 are self-explanatory. As we have explained above, one of my hypotheses is that the Enlightenment of the freethinkers that we have studied since January this year was the philosophical arm that was used to nullify the Bourbons´ new strategy of colonialism in the Americas. The whole point was to end the Europa Regina and cut the ties of America with the Spanish Crown. By providing a framework for a radical French Revolution in Europe, the attention of all the heads of monarchies was going to focus on France and later with the successive Napoleonic battles, leaving America in a completely weak position for the rest of the empires to influence the creoles for their own independence.  

Contemporary Strategy Analysis is a legacy of our past.
The Enlightenment was conceived to change the mindset of the nobility of Europe. That was the purpose of all the freethinkers who kept also their eyes on America, India, and Asia.  The warfare strategy of the 17th and 18th centuries didn´t finish then. It has continued for the last 300 years to our day. Still, there are wars on our planet: Ukraine-Russia. During the last decade, we have observed serious warfare conflicts in the region of the Levant-Persia.  Given that we have inherited a culture of violence all over the world, we have shown the context in which we currently perform our businesses. Most civil communities have adjusted themselves to trade in the middle of warfare, in conjunction with the military forces of each country. Free markets have been thriving in military operations, even in the middle of grey zones (see slide 15). The context of Spanish America versus the rest of the empires of Europe, explained in the section above, only shows us how important has been warfare. Economic models have been designed to pay for warfare and continue doing the same. Mercantilism was perfectly invented for that purpose (see slide 16) in the past and has continued with slight changes in our present. In consequence, if strategy as a science was rooted in warfare since the times of the Mesopotamians, it is obvious that our current strategic management models have been conceived with that mentality of warfare. Slides 17 and 18 converge in the same levels of warfare strategy applied to how we organize the three main levels of strategy: corporate, business, and functional. The globalization merchant model that has been implemented in China, is the same model that was used during the Spanish, French, and Britain America´s colonies.  The low-cost products that are produced in China, are not benefiting their economy as it should be. The beneficiaries of this model are those who can´t afford the same products with better quality, but that doesn´t mean that we are cheering up or loving the poor by selling them non-quality goods made in China. Everyone is losing. The economies are not growing. Artisan families who had their own prosperous businesses have shut down their operations. Everyone is cannibalizing each other: The Chinese, the local artisans and entrepreneurs of each country where China is selling, and the poor who buy their cheap products. See slide 17.

The link between the Enlightenment and contemporary strategy analysis. The same old premises. For this explanation, I picked up the balance scorecard generic model. It was a random selection from the toolkit of frameworks that we teach.  Look at slides 18 and 19:  At the top level of this framework (the financial perspective), what drives the business strategy is always long-term shareholder value, which is expressed in two premises: productivity and growth.  We can measure these premises with different financial ratios.  As a cascade, the next 3 layers for measuring and controlling our businesses (customer perspective, internal perspective, and learning-growth perspective) are driven by the top 2 strategies: productivity and growth. Most business owners are trying to reduce the cost structure of their manufacturing processes. This applies to multinational corporations, as well as to micro-enterprises. When the manager decides to play low-cost strategy, it can fall into the same concepts that drove the feudalism and the colonialism of the Habsburgs, Bourbons (of France and Spain), Hanovers of Great Britain, or the Oranges of Republiek der Verenigde Nederlanden.

If our value chain structure includes any of the following words: expropriation, exploitation, or appropriation that can occur in any country; then we are facing the same model used in the colonies before, during, and after the Enlightenment period. Look at slide number 20 for further explanation.

Changing the rules of the game. If we wish to change our society’s imbalance, I have designed slide number 21. Look at it separately below. 

From the premise of productivity with the motto “cheaper and efficient is better”, we must begin to consider a well-being premise that requires that we truly love God, others as ourselves with all our occupations, products, services, and professional endeavors.

From a maximum growth premise with a motto of “Bigger is better”, we have to shift to a moderate, adequate, and reasonable growth factor that could allow us to pay sufficiently to our employees, in such a way that they can leave the poor-low-class and emerge after certain years as a middle-class (those who earn between US$30,000 to US$175,000 per year).

“Do Everything in love”… “You shall love the Lord your God with all your heart, with all your soul, with all your mind, and with all your strength”…”You shall love your neighbor (or others) as yourself”

_{1st Corinthians 16:14
Mark 12: 30-31}

When we focus on productivity and growth, we forget about the people quality of life of our main collaborators: our employees. This shift won´t be automatic. It will require new models, new economic premises, a lot of work in business schools, validation of those new frameworks, and several generations to come.

We are a work-in-progress civilization.
To fix a past disaster in which slavery and expropriation of resources were the norm will take several generations. We can´t produce good things based on revolutions, we only harm ourselves, and what is worse we replicate and continue to use the same warfare model of our 6000 years of recorded history. Whatever we do today, will evolve to become better if there are more people with integrity, love, and respect values for others that will stop certain businesses from happening, if these new businesses hurt our humanity or solidarity with the rest. If we celebrate all the disruptive technologies (using NAIQI-Nanotechnologies, Artificial Intelligence, Quantum, and The Internet) that are being implemented today, sooner or later the history of the Trojan Horse will hurt our families at the essence of our lifetime.

 “The term Trojan horse has come to refer to subversion introduced from the outside. Beginning in the late 20th century, the name “Trojan horse” was applied to deceptively benign computer codes that seem like legitimate applications but are written to damage or disrupt a computer’s programming or to steal personal information. A trojan Horse can alter all our technologies and induce us to ruin all our industries and people might get hurt“.

Announcement. 
Adorable readers, we appreciate your desire to learn by doing your own strategic reflections over the weekend. When I do not publish the strategic reflections on Fridays, it is because I need a true short interlude because new ideas have inspired me today, beyond the boundaries of the framework of reference (the package of slides). During the weekend, it is important that you read the slides, ask yourself questions, and then search for additional information in our bibliography (slide 22). Then on Monday, you can compare your reflections with ours. That would be the only way that you will learn to practice. The following episode (to be published next Friday 17th of November) will be “The Enlightenment Unearthed in Corporate Strategy Formulation”. Blessings and thank you for reading our episodes.  

Musical Section
This week we will continue with the gracious melodies coming from oboes winds of the Baroque.

Our music of today has been uploaded by the YouTube channel of Brilliant Classics. The composer is the Venetian Tomaso Giovanni Albinoni (1671-1751). Albinoni produced several operas, instrumental works, symphonies, and concerts. The Concerti for one or two oboes Opus 7 and Opus 9 is included today. These oboe concerts are interpreted by Stefan Schilli and the Stuttgart Chamber Orchestra, conducted by Nicol Matt. Stefan Schilli is one of the best oboeists of our time. “Besides his professorship at the Mozarteum University in Salzburg, which he has held since 2004, Stefan Schilli is also a regular guest instructor at such prominent institutes as the Escuela Reina Sofia in Madrid, the Sibelius Academy in Helsinki and McGill University in Montreal”.

Thank you for reading http://www.eleonoraescalantestrategy.com. See you next week.

Sources of reference that were utilized today. Look at slide 22.

Disclaimer: Eleonora Escalante paints Illustrations in Watercolor. Other types of illustrations or videos (which are not mine) are used for educational purposes ONLY.  All are used as Illustrative and non-commercial images. Utilized only informatively for the public good. Nevertheless, most of this blog’s pictures, images, or videos are not mine. I do not own any of the lovely photos or images unless otherwise stated.