Outthink the Competition

Shift your thinking

"...the phrase paradigm shift has entered the popular vocabulary to mean any major shift in technology, thinking, or practice. One thing we have learned is that successful leaders are able to shift paradigms with agility. This helps them outthink the competition."- Outthink the Competition, page 15

If you want to win the battle for growth, market share, or whatever it is you and your organization has determined is the goal, you need to first make sure that you challenge yourselves to think differently. This means that you cannot rely on what got you to where you are now—you must alter your vision and your strategies. Krippendorff offers four challenges for all leaders to outthink your competition:

1. Recognize those things that you blindly accept as the best way.
2. Find a new option or alternative way of doing things that others are ignoring.
3. Test this new option for superiority.
4. Reduce your competition’s ability to adopt this new way.

Winning is not merely about being better or stronger, it’s sometimes being better positioned to act or react, and that comes from having thought out plans and being prepared for possible obstacles, not just repeating the same things over and over.

This book contains three models—the Outthinker Process (IDEAS), the 36 Strategems, and the 8 P’s—each briefly summarized below.

The Outthinker Process is a series of five steps that can be used to bring about innovation. The steps are captured in the acronym IDEAS:

Imagine – think about both short-term and long-term goals but envision the future state you want and set your strategy to solve it.
Dissect – take that vision apart into its necessary parts/steps and figure out solutions to any roadblocks.
Expand – pick a few strategems to follow/adapt to your business issue and then brainstorm ideas for each one and write them down—the more the better.
Analyze – take the ideas you just generated and focus on ease and impact for each to determine feasibility and effectiveness, and generate a short list of winning moves, time wasters, tactics and crazy ideas. Focus on winning moves and crazy ideas to execute against.
Sell – understand your goal (what you want to achieve), who your stakeholders are, what you want/need to say, and then how you will deliver this. This will make the adoption of new ideas much easier.

The second model, the “36 Stratagems,” comes from a Chinese text of the same title, and are a set of strategic metaphors that have been passed down for centuries through the oral tradition of storytelling, but are used here in a business sense to contextualize and describe competition. One example is “To catch something, first let it go”, which describes the concept of letting your competition move forward, with you closely behind, allowing them to tire before attacking. The book contains 35 more.

And finally, in order to truly differentiate your organization from the competition, Kaihan provides the 8 P’s which are the various dimensions an organization can influence to increase its effectiveness: Position, Product, Price, Process, Promotion, Place, Physical Experience, and People. By creating a scorecard, any organization can compare itself to its competition by assigning a score to each dimension (0 – no winning move, 1 – competition can copy within 4 years, 2 – competition will take five years or longer to copy). Any organization can leverage multiple options in each of these 8 dimensions to create a competitive advantage and set themselves up for success.

Think differently: understand yourself and your competition

"As it turned out, the research verified my hunch: the most successful innovators are using strategies that more traditional companies would never have imagined. They are creating an entirely new playbook."- Outthink the Competition, page 30

One key lesson for success is to completely understand yourself, your team, your business, and that means what makes you successful, as well as what makes you vulnerable. Krippendorff suggests that everyone should write their own “playbook” which, to borrow a term from the world of sports, is the list of plays you have and what to do in almost every imaginable situation. The reason this is so important is that to achieve new results you need to have new thinking. If you constantly try the same tactics, you’ll likely end up with the same results, but by understanding how you act, you can begin to find innovative—and potentially better—ways to execute.

But the critical factor is not only understanding you or your organization’s tendencies, but to understand those of your competitors. By knowing how they operate, what their strengths and weaknesses are, and how they will likely react, you can then look for alternatives that they cannot or will not attempt, and thereby gain an advantage.

Here is a comparison of the old and new playbooks—and their basic strategies:

OLD

• Achieve customer captivity — grab big customers early and hold on to them.
• Secure preferential access to resources — lock up contracts for resources.
• Build economies of scale — buy big and save, and build large facilities to coordinate efficiency.
• Adopt best practices — document what has worked best and repeat.

NEW

• Move early to the next battleground — plan for the next battle; managing transitions position you to win.
• Coordinate the uncoordinated — you create power coordinating things outside your organization.
• Force two-front battles — look outside your industry to gain leverage and weaken your competition.
• Be good — serve more than shareholders, focus on the community, world, environment—social enterprise.
• Create something out of nothing — create new players and opportunities as needed (think outside the box).

What this new playbook does is allows you to think differently, so you can act differently.

Act differently: make it happen

"We often think that the job ends when we have come up with the brilliant idea. What is left is to simply execute it. But before you even have something to execute, you must enroll key stakeholders—funders, employees, partners, and so on."- Outthink the Competition, page 126

Because you are thinking differently you have leverage over your organization and your competition, in that you have identified alternatives that can give you an advantage—but now you must act. Krippendorff provides ways to make this strategic thinking and working a part of your organizational DNA. The most critical aspect to any strategy lies within its execution, and to do that, it requires more than just an edict from the top. Krippendorff provides examples of how to imbed strategic thinking and the process into your organization with examples of his 3-phase approach:

1. Establish multiple points of differentiation – In this step the idea is to understand your current level of competitiveness, and then find new options to increase it, perhaps through identification of new markets or products, or a refined pricing model.
2. Create playbook asymmetry – Here your goal is to compare and contrast your playbook with that of your competition to create disruptive power and set yourself apart on a path of success.
3. Construct an outthinker culture – Take your playbook and weave it into your organizational culture. The most potent tool here is the power of narratives and the corporate storytelling that embeds strength in its culture.