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Chapter 4

War

The War Against Your Competitors

War in the sense of constant competition.

Our competitors are not our friendly competitors.

  • Good leaders explain that none of us are ever truly safe in our roles for any length of time. If this fact makes people uncomfortable, that's good. You need to get comfortable with being uncomfortable because the only alternative is denialism.

Stories of war

  • Data Domain was competing against free. What's the real cost of something free that doesn't do the job properly?
  • ServiceNow was sued by BMC - they were inflicting damage because they couldn't compete on product.
  • Snowflake - public cloud vendors buy out public debt - they don't want to compete on product - AWS has the same things as Azure, provided differently to the consumer

Very few things are off limits in the battle for the customer.

  • Executives are afraid though to ram a vendor down the throats of their employees because they may just move on to another company that lets them work with their preferred products.
  • External vendors buy out Snowflake's accounts, fund migrations, spend more money to bring the customer to them, just to inflict damage and embarrassment on Snowflake.

The Art of War - Breaking the enemy's will to fight.

  • The more high‐achieving people who desert their current employers to join us, the more we are winning. It's a double whammy: not only is our enemy losing some of its best talent, but we've taken their strength.
  • A talent drain is the best evidence that a company is in serious trouble and is losing its will to fight.

The War Against Incrementalism

  • Another human tendency is to approach things incrementally, from an abundance of caution. It feels safer to inch forward rather than take bold leaps.
  • Incrementalism is about avoiding risk by building on whatever has already been achieved as a stable foundation. But merely trying for marginal improvements on the status quo carries its own risks.
  • In most fields, incrementalism is merely a lack of audacity and boldness.
  • Larger, established enterprises are especially prone to incremental behavior because risks are not rewarded—but screwups are severely punished.
  • Rather than seeking incremental progress from the current state, try thinking about the future state you want to reach and then work backward to the present.
    • What needs to happen to get there?
    • This exercise can be inspiring and motivating, as you become guided by your future vision
  • Incrementalism can suck the life force out of people and organizations.
  • It's so easy for any leader, including me, to retreat to seemingly safer and more achievable goals.

Look to Teddy Roosevelt's Man in the Arena speech:

  • The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows the great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.
  • Why did eBay not become Amazon? Why did IBM not become Microsoft?
  • Why didn't taxi companies invent Uber? Why didn't Hilton or Marriott invent Airbnb?

Teach your people to drive the business to the limits of its potential.

This is why innovation always seems to come from the least expected places. They don't have a past to care about. They have nothing to lose, no ships to burn behind them.

Tying These Battles Together: Using Audacious Goals to Outpace Your Competition

  • Data Domain - change to network replication rather than disk and tape backup
  • ServiceNow - Flexible way to make changes happen quickly, rather than drawn out over time.
  • Snowflake - using public cloud for intense data management instead of old data platforms.

You are much better off with dramatic changes than you are incrementally.

Customers do not easily part with products that do the job for them.

Folks prefer narratives that make them feel safe, however removed from reality those narratives might be.

  • Intellectual honesty is a frequent casualty in business.

Do an unsentimental evaluation of what resources and staff you have versus how much you really need.

There is usually more performance and efficiency to be gained from your existing staff, before you take the path of least resistance—unplanned, incremental growth, leading to mediocrity and waste.

One of your biggest responsibilities is to stop incremental attitude in its tracks.