Yesterday I stumbled on this excellent article – Know Thy Enemy– in The American Interest, that links competitive knowledge and insight to strategy making.
The piece reaches back 2,500 years to buttress points I’m constantly making with clients: Your rivals are NOT you. They think differently, and operate with different goals and motivations. What you consider irrational on their part could be perfectly rational from their vantage point.
Until you accept this and take a shot at understanding opponent’s interests and motivations, any strategy you adopt is necessarily flawed.
As the article’s author points out, the ancient Greek city-states understood this. Today, in both the public policy and business space, we seem to want to avoid it.
Good strategy requires a sound understanding of one’s rivals. A rival in any walk of life is, in a sense, an interlocutor. To engage him effectively in debate one must understand his speech and reasoning patterns. Without that knowledge, conversation is at best pointless, at worst self-defeating. So it is in strategy. It is futile to engage in competition with a rival power without having at least an inkling about his thoughts, fears, and desires.
The modern Western penchant for trusting in the equal rationality of all suggests otherwise. According to this conceit, there is no reason to plumb the nature of an enemy’s thinking because it is no different in essence from one’s own. But this is wrong…
So often I see business strategists, market researchers and competitive analysts thoroughly focused on the data while they neglect the harder and more slippery work of analyzing and speculating about behavior.
The promise of “big data” is the latest trend here. Somehow more data and more robust analysis methods will yield greater certainty. They don’t.
Through a wonderful review of Aeschylus’s great tragedy, The Persians, the author notes that this preference for measuring things versus speculating on intent is age old.
… we often fall back on measuring the enemy’s armies, economies, and populations as indicators of what he may achieve. In such an assessment of material variables, the implicit logic is: If the enemy can, he will; and if he cannot, he won’t. In modern academic parlance, we use capabilities as proxies of intentions.
This is a weak foundation to rest upon nowadays, as it was 2,500 years ago. The Persians did exactly that with the Greeks, and they lost. As the messenger bringing the bad news of the defeat to the Persian court puts it, “so far as numbers are concerned, the fleet of the barbarians would have prevailed.”
Indeed, so far as numbers are concerned nearly every idea or strategy should succeed. Yet it doesn’t.
How many great organizations have banked on scale and fallen to the assumption that rivals would do “what they are supposed to do” instead of what they actually did?
As both strategists and intelligence leaders, we would do well to remember our Aeschylus. And we should challenge ourselves and our organizations to do a better job of trying to understand rival intent!
This is a message that deserves attention – again and again and again. Thanks for posting it. There’s too much emphasis on competitors and what they do, as you cited. Further, buyers today (B2C and B2B) have more and more options – not only from direct competitors, but from indirect and substitute competitors.
All are worthy of attention, limited attention, for keeping current on what customers are buying and why. The rest is detail. Rather than spending time and money on digging deep into competitors, a company is far more likely to succeed by focusing on the marketplace, especially gaps or weak offerings or finding buyers who don’t fit the target profile or alternative uses, etc..
Thank you very much for posting this extremely pertinent reminder. Yes we spend so much time and resources making various types of competitive analysis that we often forget the strengths/ capabilities of one’s product. The important thing however is to keep abreast of the developments in the market place and any new product likely to impact on existing offering.
Shiv, thanks for the comment. Don’t disagree, but the key point here is to know the mind of your rivals. Not just product scanning or marketplace sensing.