By Thomas R. Schori, Ph.D., and Michael L. Garee, Principals, Millennium Marketing Research, 808 E. Ironwood, Normal, IL 61761-5239.
Having been in the world of business for some time now, we’ve noticed a truly amazing phenomenon. Managers and executives alike believe their counterparts at larger competitors to be "smarter" than they are. Oh, they don’t come right out and say this, but what they do say makes it readily apparent that they do, in fact, believe this to be the case.
Time after time, one hears statements that are variations on two themes¾ both of which imply that the other guys are smarter than are they:
Both senior consulting partners at Millennium Marketing Consultants have been employed by both small and large competitors in the same industries. Without the least bit of doubt, one fact is clear. As it turns out, the players in the bigger companies are in no way shape, form or manner actually smarter than those in the smaller ones! Of course, if you’re in a smaller company, acting as though the "biggies" are indeed smarter will ultimately lead down just one path¾ failure.
Good ideas
Remember, your larger competitors don’t own the market for good ideas, so don’t ever get the idea that they do. If you think that they do, you’re making a BIG mistake. You might just as well take down your shingle, sell your assets, and go out of business.
On the other hand, if you have an idea for something your competitors aren’t doing, that’s great! That’s exactly what you should be doing. That doesn’t mean, however, that you shouldn’t pay attention to what your competitors are doing. Ignoring them could be just as disastrous as imitating the dumb things they might be doing. Still, not doing something because they aren’t doing it would be dumber still.
If your idea looks and sounds good to those with whom you wish to do business, do it yourself! And do it NOW, not later. Put yourself on the road to becoming the "bigger" competitor, as Philip Morris did with R. J. Reynolds. Or, as "upstart" Microsoft’s operating systems division (Windows) has done with IBM’s operating systems division (OS/2). It’s readily apparent who’s the winner of that battle. Of course, now Microsoft is about to go head-to-head against IBM once again with Windows NT versus IBM mainframes. Make no mistake about it, the grown up "David" is certainly a worthy opponent for Goliath.
Follow the leader
Because your major competition begins to do business differently, management within your company may feel compelled to follow their lead. Dumb! Oftentimes, they will want to do so even though those whom they wish to do business say, "that’s not the way we want to do business." That makes it dumber still! If your customers say, "don’t do it," then you would be well-advised not to do it! It’s that simple. Some within your organization may say, "But what the customers meant to say was…." Nonsense! Listen to what customers say, not to what someone within your organization thinks they meant to say. Your competition may be putting themselves on the escalator down, so always, always, always listen to your customers. Don’t assume that your competitors are smarter and blindly follow their lead right over the cliff.
Even though your competitors may have an incredible new idea that results in an entirely new product category, it still may not be in your best interests to follow. Keep in mind, the first in a product category tends to dominate the category. Look at Bank of America (Visa). They created a new product category, bank credit cards. Hundreds of banks across the U.S. followed their lead and offered their own credit cards. Their cards failed. They now all offer Visa, and pay the Bank of America franchise fees for the privilege of doing so! They would have been better off generating ideas that might lead to their own new product categories, rather than simply following another’s lead. Some of those "followers" just might have created their own new product categories, which they might be dominating even now.
Moral of the story
If your actions imply that your competitors are smarter than you are, e.g., if you don’t think an idea has any real merit because they haven’t done it, or if you’re compelled to follow their every lead, then they are indeed smarter than you. And, unfortunately, all that’s in your company’s future quite likely is a "ho-hum" market share and, eventually, even failure.
The reality of the situation is that they’re not smarter than you. Perhaps they’re even less smart than you. Success breeds complacency and layer upon layer of bureaucracy, which in themselves are the forerunners of failure. Theirs, not yours. Be overjoyed when you come up with something that your competition doesn’t offer, but which your customers like. Similarly, don’t follow them into something your customers say they don’t want. Be thrilled that they’re doing what customers have said they don’t want, but let them go it alone. Let them feel the hurt alone.