Chapter E4
Rule 4: Exploit the momentum
If you go long distance trekking in the mountains, sooner or later, you will find yourself in bad weather. That’s when you are at risk of becoming the target of a falling stone. A 100-gram stone in itself is not capable of having much effect if it is placed on the human head. When dropped from a height of one meter, it can cause a minor bump. Dropped from five meters, it can cut through flesh and open a serious wound. Dropped from ten meters, it will very likely kill. In reality, you will find that these shooting stone fall several thousand feet before they get a chance to pulverize you. What are your chances of surviving a falling stone in bad weather when the steep slopes are slippery?
I recognize that most of us never go trekking in the mountains, but we do end up in cars. If you drive, you know that braking distances increase dramatically as speed increases. That is momentum. If a car travelling at 50 kmph stops in 37 meters, it will stop in 40 meters if travelling at 55 kmph. At 60 kmph, it will stop in 45 meters and at 65 kmph, it will stop in 50 meters. All this seems pretty linear and prosaic. The effect this has on a pedestrian is another story. If a car travelling at 60 kmph stops just in time and merely touches the pedestrian, at 65 kmph, it will hit the man at an impact speed of 32 kmph. Here is a little graph to tell you what will happen to the poor pedestrian if you drive too fast:
At 70 kmph, you will hit him at nearly 50 kmph an hour and will very likely kill him. It is not for nothing they tell you never to underestimate the carnage you will cause if you go over the speed limit!
To get back to the point, as impacts go, momentum is the greatest of force multipliers. The ‘power’ in the stone so to speak is truly not in its weight: it’s in the momentum it is able to generate before it strikes its victim. Think about this. A one kg stone travelling at 10 kmph has the same momentum as 100-gram stone travelling at 100 kmph. You can see the relevance of this simple fact in litigation. If you are a small player in the world of commerce and have only a 100-gram stone to hurt your enemy with, you are not bound to lose the war only because your enemy has a stone weighing one kilogram to hurt you with. It is the momentum you are able to generate at the point of impact that determines what effect your weapons have on your enemy. That is where you have to bring your tactical skills to bear on your limited resources and multiply its ‘power’ for maximum impact. This is the heart of our fourth rule of litigation tactics.
There is a second, and in India’s case, greater reason to prioritize momentum over mass in our litigation tactics. Our adversarial system of justice is snail speed slow. A case is filed and the court informs the other side. After some months (or maybe years if he knows how to be elusive), your enemy receives this notice and appears in court. He then has time to file his reply. If he is a good story teller, he will buy a lot of time. Even after he files his defense, he can protract the trial endlessly. There are many ways to protract a trial. Most of them consist of taking ‘preliminary objections’ to the case you file. You did not add a party you should have; you added more parties than you should have; the court does not have jurisdiction; the case is premature. It goes on and on. For every rule of procedure, we have in Indian courts, I will find you a hundred exceptions. Sometimes, when the court rejects his objections, he goes up in appeal and the whole procedure goes backwards a few years. It may be many years before both sides have exhausted the early-stage jousting and are ready to go into recording ‘evidence’.
In many courts, once all pleadings are complete, your case will come up for witness statements after 3-4 years. The Justice Machine is clogged with work and no one has any bandwidth to take on more. By the time your case is decided, you may have lost a decade, maybe two. Then, no matter who wins, or loses, someone files an appeal and the whole show starts up again. Through this process, you, and your enemy is faced with rising ennui. By the time the case is decided, everyone is totally fatigued. Let no one remind you that you don’t solve your legal dispute only because you have won your case. For instance, just because you have a decree to recover money, it doesn’t mean you will soon have money in your bank. ‘Execution’ proceedings – meaning the process by which decrees are enforced – can take years, sometimes decades. I have seen many cases where by the time it all ended, everyone who started the case was dead!
How are you ever going to ensure that your case doesn’t become an unfinished opera? You need momentum, and for many reasons. You need it because you need motivation. Action on a sustained basis is possible only if it is accompanied intermittently with gratification. You need to see progress and that will only happen if you can shake the system out of its lethargy. How will you shake the system? You need to get your court to do it for you. A court is after all only human. A judge is unlikely to be moved by your case if it shows up on his list every couple of months. When it does show up on his list, he will likely kick the can down the road for another six months. You need to find a way to bring it to the top of his recall and become a burning issue. You can do this through emotional appeal and that comes in many forms. At the very least, you have to project desperation. Usually, desperation is projected by filing application after application thrice a week till the judge gets fed up and gives you what you want just so you will go away and stop hassling him!
Beyond the light hearted banter though, why do litigants file application after application in hotly contested cases? Its all about cumulative effect of high-speed motion, meaning momentum. Its like hitting your enemy repeatedly in the face, punch after punch. No one punch is particularly powerful but the frequency with which you deliver these small punches beat your enemy into submission. This is not only about keeping the initiative; it is also about the cumulative impact of the momentum, of the series of blows. This requires strategic clarity, and great planning. You have to plan your war so that your opponent is driven back slowly but relentlessly, pace by pace, till his back is to the wall, facing annihilation or flight, at which point, he opts out of the war.
You can apply this principle in a great variety of situations. To illustrate momentum in litigation, I have picked up a recent case before our Company courts which remained at the initial pleadings stage even as the underlying arbitration was invoked under Singapore rules was decided while the Company courts were still grappling with short term interim operational issues.
The LoPan case
Lohia Electronics was amongst the first wave of companies who set their sights firmly on ‘atma nirbharta’ just as soon as the new government was sworn in. In 2014, they purchased a bankrupt Ukrainian company, thus acquiring technology for the manufacture of specialized electronic components used by a wide variety of Indian industries, from infrastructure to defense. Since they already had an empty factory waiting to be filled, they quickly moved the Ukrainian plant to India and rolled out the first wave of electronic equipment late in 2015.
Initial results were disappointing. From a marketing perspective, the company’s business plan had its limitations. Without a brand to back it up, or a track record to boast about, which government tender or defense contract could they ever hope to win? By 2017, Lohia Electronics was deep in debt as domestic interest rates squeezed the company, making it unviable.
It was India’s atma nirbhar policy that rushed to the rescue. It became harder and harder to import and sell material to the Government or public sector companies. Another wave of joint venture formation swept across India as foreign corporations established value addition factories in India. This is when the Taiwan based Xupan Industries reluctantly succumbed to their commercial compulsions and offered to buy a controlling stake in Lohia Electronics.
Lohia loved the idea, but they placed a high value on the company, a value which Xupan could deliver only after becoming a shareholder. Xupan did not see why it should pay Lohia for the value it would deliver to the company after becoming its owner. Negotiations stalled but, in the end, Xupon offered to use the earn-out solution. In culmination, Xupan purchased 60% of the equity up front from Lohia at its current value and agreed to buy the remaining 40% in annual installments over four years. At the end of the 4th year, in addition to payment for the last bloc of shares, Xupan agreed to pay an earn-out based on the actual Ebitda of the company in the fourth year. Meanwhile, two Lohia directors would contribute to the management of the company and serve on its Board.
Xupan positioned Lohia’s continuance in the company as a great value-add. They offered Chairmanship of the company to senior Lohia, with the additional right to nominate a Vice-President, who’s approval would be necessary for the CEO to perform a wide variety of executive functions. In these four years, Lohia would exercise wide ranging minority protections at both Board and shareholders levels. A JV Agreement was signed in late 2017 whereupon Lohia Electronics became LoPan Electronics and management passed to Xupan.
It wasn’t long before the fundamental flaw in the structure of the JV reared its head. Lohia earned nothing on the initial share sale: its upside was backloaded to the day it sold the last block of its shares. That was just the beginning. The Ebitda multiple for the earn-out was agreed at 26! Are you willing to buy a business and grow it knowing that for every rupee you earn for the company, you will have to pay your partner 26 rupees worth of earn-out? Clearly, the earn-out formulation disincentivized any commercial success in the company to the point of absurdity. Xupan would have to be suicidal to honor its obligation to grow the business.
There is a painful predictability to what came next. As soon as it took over management control, Xupan shut down a high-value business segment and started supplying these items directly from Taiwan. Xupin also started taking Indian orders directly on the Taiwanese parent, and then handing out subcontracts at a much lower price to LoPan. It was obvious that Xupan make sure Lopan did not make a tidy profit just so Xupan didn’t have to pay a huge earn-out. Lohia protested this skullduggery at successive Board meetings. Xupan directors first pretended they did not understand the issue, then brazened it out. Lohia retaliated by exercising veto powers on any resolution that even remotely damaged Lohia’s earn-out. This enraged Xupon and the battle lines were clearly drawn.
The crises now escalated. Xupan retaliated by proposing Board resolutions which would directly hurt Lohia’s interests. Lohia excised its veto rights again. Xupan refused to honor these rights, claiming these matters were not included in the minority protection list. Lohia further escalated the war, adopting hyper technical and legalistic procedures so that operations became more cumbersome and dilatory. For example, LoPan’s main supplier was a Lohia subsidiary, located a mere stone’s throw from LoPan’s factory. This supplier now started supplies ‘according to the contract’ and not on priority depending on LoPan’s needs. When LoPan tried to replace this supplier at a Board meeting with a third party, Lohia blocked the resolution. Similarly, LoPan’s main factory was located in an Industrial Park run by Lohia. LoPan’s inbound shipments of raw material and components started to be delayed at the security gate of the Industrial Park, sometimes for days. There were always legally defensible reasons to delay these supplies, but the highly technical interpretation of the law make life hard for LoPan. It helped Lohia greatly that most LoPan employees were still Lohia loyalists.
Lohia took its obstructionist tactics into the company’s internal working as well. The Company Secretary would not allow Board meetings to proceed without a nod from the Chairman. The Manager Finance would not authorize or process any payment unless the Chairman said he could. The HR Manager ‘persuaded’ other employees to act according to the Chairman’s wishes. LoPan’s head office was located in a building owned and controlled by Lohia. Xupan tried to bring in substitute service providers to replace Lohia loyalists, but the security guards would not allow them to enter the head office. LoPan’s operations suffered as a result of this partner dispute.
If you think about it, operational dysfunction in any joint venture always works to the advantage of the party who carries lesser risk. Lohia was an exiting shareholder, waiting to be paid-off. The only question was how much? If Lohia believed Xupan would diligently work the company and secure Lohia’s earn-out, its best interest would lie in preserving the long-term health of the company. But Xupan had already betrayed Lohia. If cooperation with Xupon would not bring a substantial earn-out, perhaps holding Xupan’s feet to the fire would? In turn, Xupan had everything to lose. Business is not a coke-vending machine: you don’t just run about like a headless chicken and expect a fat earn-out to come out the other end. If Lohia wasn’t stopped, Xupan feared that these tactics would do lasting damage to LoPan’s long term health. What was Xupan to do?
Parties had signed an arbitration clause but that would not help Xupan. Lohia had the legal right to exercise its veto rights as it saw fit in its commercial interest. Xupan could not create a legal case based on how this veto was exercised. That didn’t apply to what Xupan saw as Lohia’s obstructionist tactics outside the Board room. No party to a contract has a right to obstruct their common business from functioning smoothly. This could be the basis of a case. Xupan decided that its best interest lay in filing such a case in an Indian court, rather than in an arbitration. This was entirely feasible. You can write any contract you like, you can choose any jurisdiction you like and you can select any choice of law you like and it makes no difference to the Justice Machine. When an Indian court wants to intervene, it will supersede anything and everything the parties may agree to do regardless of the consequence.
At the risk of digressing, I should probably explain myself here. Not so long ago, the Supreme Court cancelled allotments of spectrum to telecom companies even though these companies had taken vast loans and spend billions in building up infrastructure based on these licenses. The contracts were backed up by sovereign guarantees. The court didn’t care at all that the Government of India may have to pay vast sums of money for the choices the Justice Machine had made. The Supreme Court also cancelled a larger number of mining contracts even though these parties had drawn down on humungous credit lines from Indian banks based on these licenses. In the result, the Indian banking industry came under deep distress as the promoters disappeared in a puff of smoke. In looking at these decisions, we should remember that the Supreme Court proceeded from the perception that the Government of the time had been corrupt in granting these spectrum and mining licenses. Nine years later, not one person has been convicted of committing a crime.
Not to put too fine a point on it, the Justice Machine exists to administer a particularly obtuse type of justice: it does not exist simply to enforce the law. The Justice Machines also cares only so much about the intention of parties or the integrity of contracts. If you can tug at the right heart strings, you can get the Justice Machine to do some remarkable things, far beyond what the law allows. In choosing an Indian court to serve its commercial purpose, Xupan made an impeccable choice. Soon, it petitioned the National Company Law Tribunal (NCLT) asking that Lohia directors be removed from LoPan’s management and Lohia be forced to sell all its remaining shares in the company at a price determined by a court appointed valuer regardless of whatever was written in the JV Agreement.
Filing this petition did not mean that LoPan’s day-to-day operational problems were solved. Xupan had several different problems. First, Lohia’s veto at the Board level had to be neutralized. To do that, it needed the court to disregard the company’s Articles of Association and the JV Agreement. Second, it needed LoPan employees to report only to Xupan. To do that, it needed to remove key Lohia loyalists. Third it needed to get Lohia’s subsidiaries to resume timely supplies to LoPan or get out of the way. To do that, it needed to be able to place orders on third parties and have those supplies come in regularly without ‘legal objections’ at the security gate. Most of what Xupan wanted violated both the Articles of the Company and its JV Agreement. How was it to get away with its own strong arming and get NCLT to help it steamroll over Lohia? How was Xupan to get an Indian court to pay any attention to its day-to-day operational problems and serve up a solution?
The answer lies in an old Indian adage: “if it doesn’t cry, even a mother doesn’t feed her baby”. With a mother is as far removed from everyday commercial life as the Justice Machine is from its businessmen, the crying has to be corresponding long and loud. In tactical terms, the child needs to get the environment moving till everything resonating to its lament. It needs to get momentum!
Xupan unleashed a program of tactical crying while simultaneously violating every rule in the book. It instituted and maintained relentless attacks on a daily basis on Lohia, confident that sooner rather than later, Lohia would collapse under the pressure. The rest of this story is about litigation momentum.
No sooner had the decision to attack Lohia been taken, Xupan called a Board Meeting. It asked for Board resolutions to be passed implementing sweeping management changes which included replacing the Company Secretary, the HR Head and the Manager Finance. It asked for changes in bank signing authorities It asked for parties to move LoPan’s head office out of the Lohia owned building. Lohia reacted by exercising its veto. It refused to let the Board Meeting be convened. Lohia demonstrated its control over the company premises by preventing Xupan’s consultants and service providers from visiting LoPan’s offices without a legitimate business purpose. Xupan went to court. It was an acrimonious hearing and both sides had their perspectives. At the end of the day, company business can’t go on if no Board meetings are held. NCLT ordered LoPan to have its Board meeting under the guidance of a court appointed ‘Observer’. In the interim, Lohia was ordered not to obstruct the free movement of company employees in and out of the Head Office.
No sooner had the order been published, Lohia was in court seeking its modification, citing new facts and subsequent events. It asked that no voting occur on matters reserved to its veto rights. The court devoted several hours to this case once again. Since most of Lohia’s concerns were protected in the Company’s Articles, NCLT decided not to interfere. Instead, NCLT said any Board decision would be subject to its own and the shareholders’ final approval. It also ordered LoPan to videograph the Board Meeting for posterity.
The ensuing Board Meeting was acrimonious. Xupan came with several lawyers in tow, declaring that these were special invitees present to support Mandarin speaking directors who understood little English and even less of Indian law. Right off the bat, the court appointed Observer took control of the meeting (as opposed to merely observing). Lohia heard him muttering to Xupan’s Indian director that it was time to teach Lohia a lesson. He then went on to steer the meeting as if he was its chairman, steamrolling over old man Lohia. Disregarding the protests of Lohia’s directors, the Board passed a succession of resolutions that were illegal on the face of them. It replaced key management personnel, removed and replaced directors, approved new signing authorities for banks and establishing new operational procedures to exclude Lohia loyalists and directors. It was a bloodless coup, conducted with cold efficiency.
It was now Lohia’s turn to knock on NCLT’s doors. It wanted these resolutions stayed because they violated the company’s Articles of Association. NCLT was unmoved. With the pressure of work the Justice Machine faces day on day, there never is a legal problem so glaring it can’t be ignored. That didn’t mean that Lohia had rolled over and surrendered. NCLT’s refusal to hear Lohia did not mean that it had approved these sweeping resolutions. Lohia adopted ‘direct action’ on the ground, treating these resolutions as illegal and refusing to comply with them. Lohia dared Xupan to go to court and get clarity. The security guards wouldn’t allow the new Company Secretary, HR Manager and Finance Head to enter company premises. The incumbents refused to hand over charge to the CEO. The Finance Head refused to change Bank signing authorities. Lohia loyalists refused to allow new operational procedures to come into effect. Everything had changed on paper and yet on the ground, everything remained the same.
Frustrated, Xupan went back to NCLT asking that it be allowed to implement these controversial resolutions. This time around, NCLT gave parties an equally patient hearing. Within the day, it allowed Xupan’s application, conferring legitimacy on the Board Meeting. It ordered Lohia to allow these new employees to enter company premises. It also changed signing procedures. For the moment, Xupan had won.
The moment didn’t last. Soon enough, Lohia was in appeal before NCLAT (the appellate forum over NCLT), asking that NCLT’s orders be stayed and the whole case referred to arbitration. NCLAT’s attitude reflected a partial departure from the ‘majoritarian’ predilections of NCLT. It reinstated old signing procedures but still took the view that Lohia could not cherry pick who it would allow into LoPan’s office. It was a partial victory for Xupan, and to that extent, the momentum had worked.
Xupan was not willing to let this momentum dissipate without lasting benefit. Shortly thereafter, it sent a mass of external consultants, security guards and what appeared to be congenital ruffians to visit Xupan’s directors at LoPan’s head office. It was a case of intimidation as much as it was a case of legal opportunism. With no discernible business to conduct at the head office, the security guards denied access to this noisy herd. Xupan was quick to file a contempt petition against Lohia directors, ask that they be imprisoned. NCLT was forced to take notice.
Now, bear in mind that as a general proposition, the Justice Machine does not like to hold its citizens in contempt or send them to jail. Even Arundhati Roy’s vitriolic rhetoric against the Supreme Court only cost her a day in court, spent twiddling her thumbs serving her sentence of contempt! NCLT did what the Justice Machine often does. It summoned Lohia directors, tore into them, told them to behave themselves but held the case over to another day without written orders. It didn’t work. Lohia directors waited for written orders. Since nothing changed on the ground, NCLT called these directors again in a few days, dressed them down one again and still passed no written orders.
While these dynamics played out before NCLT over successive hearings, Xupan turned up the heat a notch. It filed a series of applications before NCLT. In one, it asked that Lohia directors be ordered to make their companies supply goods and services to LoPan at preferential rates on a priority basis. In another application, it asked that LoPan be allowed to use other suppliers without reference to Lohia directors. In practice, this meant that they wanted Lohia group companies to supply them whatever they wanted on priority at a price they liked but they also wanted the freedom to buy whatever else they liked from third party sellers at much higher prices. It was grotesque unfunny but in the innards of the Justice Machine, irony is capable of transforming into macabre reality.
NCLT’s orders on this application turned out to be a glass half full. Xupan was free to place its own orders on anyone it chose and supply these goods to LoPan at any price it chose but it could not force LoPan to pay any arbitrary price for this. NCLT directed Xupan to share the details of these purchases with Lohia directors and enjoined them to ensure that LoPan did not suffer. To be fair, this is as much as Xupan could have expected. It was after all a bridge finance issue. It needed to finance procurement for a while and it could then balance the books when it had better control over the Company.
Did this put an end to this controversy? No, it didn’t, because Lohia was not done yet. When this material turned up at LoPan’s door, the Industrial Estate security gate took a highly technical view of the paperwork and refused to let the truck in. The truck stood there four days across a weekend, forcing Xupan to again knock on NCLT’s gate. Xupan filed another batch of contempt petition against Lohia directors. On this occasion, Xupan also filed contempt against every employee who had participated in this ‘obstruction’. It was truly extraordinary: in the annals of Indian judicial history, has a shareholders’ dispute ever resulted in a shareholder filing contempt cases against its own employees?
NCLT heard the matter at length. It sympathized with Xupan and rightly so. It once again directed Lohia to get out of the way.
With each application and each court action, the fight was getting dirtier. Xupan had exerted as much pressure as it could within the legitimate envelope of the issues between the warriors. It now turned up the heat a notch and started to manufacture its own grievances. It ordered a host of small supplies with different manufacturers. When these supplies came in, Xupon asked these suppliers to stop the trucks in the bylanes well short of the industrial park gate. This became the pretext of a new set of grievances. Xupan issued a series of aggressive letters to Lohia and then reported the ‘obstruction’ to NCLT. In the bargain, Xupan then filed another batch of contempt petitions against Lohia directors. Exasperated, NCLT expressed its displeasure in court and then passed orders allowing all these trucks in. If Lohia resisted, it warned that Lohia directors would head for the slammer. The learning if any is that extra-judicious methods sometimes bring extraordinary results in judicial proceedings!
Xupan was nowhere near done. It unleashed its next tactical attack by not sending operational decisions to Lohia’s directors for several weeks. Three weeks into this blocking maneuver, it send 274 cryptic decisions to Lohia directors, each on a separate page with no explanation. It demanded immediate consent. Without waiting for a response, it petitioned NCLAT next day, complaining that Lohia directors were not cooperating, and were obstructing legitimate operational decisions. It asked NCLAT to allow the company to follow a new simplified decision-making process. NCLAT was displeased but refused to intervene on the spot. It directed Lohia directors to attend court at the next hearing. Lohia’s directors responded quickly. They filed written replies explaining that they could not understand what they were being asked to approve. Perhaps NCLAT saw through the game. Nevertheless, NCLAT delivered to these directors a stern pep-talk and then ordered them to sign all operational approvals in future within 48 hours ‘after all information had been made available’.
Given this qualification, the order looked good on paper but changed nothing on the ground. It didn’t change Xupon’s tactics either. Xupan employees continued to bunch up operational approvals till they added up to a thick mass. They continue to send these masses of papers to Lohia directors without details for signatures. In response, Lohia directors continued to dictate long emails seeking clarification on what these approvals actually meant. Xupan then responded by filing successive contempt petitions before NCLAT. By now, NCLAT was utterly exhausted. It got to a point where it simply would not hear the case if it could possibly help it. Still, it was clear that Lohia was beginning to run out of gas. Litigation costs money and takes energy. How much can anyone fight over little things?
Even as Lohia’s responses began to fade, Xupan now widened its theatre of battle as it continually escalated its pressure tactics. It next filed applications before NCLT complaining that Lohia directors, HR Manager, Finance Head and the Company Secretary were withholding company records and refusing to share them with Xupan’s executive directors. Xupon wanted the records handed over and these persons hauled up for contempt once again. NCLT was sympathetic. It called Lohia’s directors to court once again and dressed them down, telling them they would be in jail if they did not cooperate within two days. By now, Lohia was at least as exhausted as NCLT. It handed over these records and let its loyalists recede into the background.
Not long afterwards, Xupan engineered another approval logjam. It then went back to NCLAT, protesting that it simply couldn’t run the company amidst all this bureaucratic to-and-fro even as Lohia diluted its shareholding year on year. NCLAT had done everything to protect Lohia within reason but the writing was on the wall. How long can the Justice Machine protect the man with no stake in the future of the company? NCLAT modified its previous orders and allowed Xupan to take near total control over the company. Lohia had finally been eclipsed.
Lohia didn’t give up immediately though. Against legal advice, it approached the Supreme Court, asking for its protection. The Supreme Court wasn’t about to interfere with this kind of operational stuff. In four weeks, it dismissed the appeal and directed NCLT to decide the whole case within 6 months. The cheese had finally moved and the Justice Machine had washed its hands off Lohia.
Let us synopsize the balance sheet. It took Xupan thirteen months to expel Lohia from company management. To achieve this result, Xupan had filed 19 separate judicial actions before two different forums in India. Xupan had also initiated contempt proceedings on 6 different occasions not only against Lohia directors but also against its own employees who had no interest in this dog fight. I can confidently state that in 42 years of law practice, I had never seen anything like this. The learning if any is that the pressure generated by momentum does pay if you can sustain the pace. It beats down the opponent, but perhaps just as significantly, it exhausts the Justice Machine to a point where it sometimes gives you what you want.
The Lopan case is excellent illustration of the extraordinary results that momentum can achieve. If you look at each element of the action, nothing particularly extraordinary occurred. It was in the cumulative impact of the pressure: where Lohia was slowly but surely driven back and attacked continually that results came. More significantly, it was in the ‘pressure’ Xypan put on the court with its cry baby tactics that led to the court finally giving it whatever it wanted. The experienced litigant therefore knows that to win, it needs to adopt the fourth rule of the Seven Tactics. This is how strategic power achieves successful projection.