COPYCAT STRATEGIES HAVE AN EXPIRATION DATE

If you have ever seen a bicycle race, you probably noticed the strange phenomenon known as the peloton. Most of the racers group together in a single big mass. Joining the group helps shield riders from the wind, but staying there also prevents them from winning.

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This same concept exists in business and I think about it all the time. It’s much easier to copy somebody else’s idea than to invent a new one. In service companies, it’s easier to focus on improving efficiency and margins than it is to find new ways to create value for customers.

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The temptation to follow the beaten path is strong. Over my career, I have seen many business leaders conclude that they’ve found a recipe for success that they can just ride for years. In my view, this tactical approach can work for a while, but is doomed to peter out and fail in the long term.

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In investing for example, to win you have to be able to buy low and sell high. It's hard to do that if you’re following the crowd… you’ll be buying higher and selling lower.

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Consistent long-term results depend on the ability to adapt to circumstances. And think for yourself along the journey. There is no formula that will always work. Success requires having the confidence and vision to recognize and adapt to new dangers and opportunities as they emerge.

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How we approach risk also has big implications for company culture. In many companies, risk aversion can be like a virus that infects people’s minds and erodes their initiative. This might not kill a company, but it puts them on the road to offering a commoditized, low-margin product.

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In contrast, a great company culture rests on a foundation of smart risk-taking. Think for yourself, be dynamic, and believe that we can do this.

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Just as racers who stay with the pack won’t technically “lose,” businesses that follow others can stay in the game for a while. But drafting behind others only takes you so far.

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Leaders who want to win need a vision, the guts to try something new, and a team that believes they can do great things.

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