In the business world, entrepreneurs tend to chase their competition and get carried away by their performance. This lets them imitate their competitors by losing sight of their own purpose (mission). If another company introduces a product or new feature, you do not have to implement the same thing.
Your target market might be different; secondly, your customers may want something different. If you spend too much time focusing on the competition and copying each of their moves, you lose your focus. Porsche and Ford are two automakers, but with different visions and missions. Porsche is proud to be an upscale automaker, focusing on the finest technical finishes that make their cars expensive and catered to the upper-class only. Ford, on the other hand, is a global automaker that plans to have its product in every home. Their focus is on sales and marketing. They are aimed at all market segments and in particular at working class families. The management of Porsche cannot compare its performance with Ford cars because one element of the former mission is the perfection of technology, while the second is mass production, sales and distribution.
You’re distracting yourself (and others)
- Keeping track of companies in the same field as you is always smart, but obsessing with competition hurts you because you focus on beating them instead of serving your customers and maintaining your own business. It’s about filtering general uncertainties from evidence-based strategies. As a leader, it is important to recognize the fear-based thinking that you convey to your employees. The speed of your organization depends on what motivates you and what you want to focus on. Determine what kind of shortsighted culture you could create for years to come.
You limit your growth
- Do you really want to create your five-year plan based on what a competitor is doing? They could go broke, move around, or become your ally. You’ll need to reevaluate your entire strategy and reassign resources quickly. The competition-based rhythm can work in a limited situation, like two startups looking for the same space first (think early in Uber and Lyft), but most situations require long-term thinking. For this reason, it looks less like football, which has a fixed clock and a clear opponent, and more like poker, where focusing on an opponent is a strategic mistake.
- What if you focus on the bankruptcy of one opponent and while doing so, another beats you out? Remember, if you beat your enemy, you have to keep playing – and there will be other enemies (time, money, etc.) ready to take his place. The only thing you should fear is complacency. From personal growth to environmental growth, complacency is the real enemy of your business. Your customer will change, your business model will adapt and the technology will change your services. Successful entrepreneurs and the successful companies that build them grow because they are focused on continuous excellence – the ultimate weapon against their competitors.