Reliable success requires accurate assessment of both sides; most failure comes from misjudging one's own capacity.
Sun Tzu's fuller statement: know both and you need not fear a hundred battles; know only yourself and you will win and lose in turn. Misjudging one's own capacity is the more common failure.
In practice
- A negotiator who has read everything about the other side and never established what his own board will accept concedes a term he cannot deliver.
- A firm that has studied its competitor exhaustively and never audited its own delivery capacity loses the contract it won.