Break from the Pack [Hardcover]

Harold Rosenberg's famous shot at his fellow New York intellectuals as "a herd of independent minds" has been usefully applied to almost every kind of grouping people make for themselves. It is as true of teenagers in their conformist non-conformist fashions, college students in their uniform way of becoming independent from the parents whose money they use to fund this process, and it is also true of business people.

Why is this so? Maybe part of it is similar to the behavior of herds of animals that live around predators. Staying in the herd increases your chance of survival. Wandering off through carelessness or being too slow or ill leads to becoming someone's lunch. However, in human activity that is often competitive, it is staying in the herd that can lead the immutable laws of economics to allocate your resources elsewhere and you starve to death.

Oren Harari opens the book describing his observations of a long distance race. The first group was about three people who were fit, full of energy, and alone. In back of them was a slightly larger group that was huffing and puffing trying to catch up to the first group that was setting the pace. Then came the huge pack - the herd - who were plodding, sweating, and straining to simply not trip over each other. Finally, a smaller group brought up the rear who were having a good time walking along, but made no pretense of even being in the race in any meaningful way. This is quite an apt metaphor for competing in business.

This book provides interesting perspectives on ways you can rethink your company's position in the marketplace and get into that front group and leave the big pack behind. Obviously, you will have to do things differently than the way "everyone else does it". It will make you uncomfortable and being that alone may make you fear being noticed and eaten. But it is in the pack that the competitive business faces the most danger.

After framing his argument in the prologue, Harari divides the rest of his book into three parts. The first is resisting the pull of the pack. He describes "commodity hell" and how living in the copycat economy is a form of doom. I particularly enjoyed the chapter on "how to lose". He explains ten compulsions we face that keep us mired in the pack stepping on each other's toes breathing bad air. His founding principles for success are based on continuous and calculated reinvention and being curious, cool, and crazy in order to build a culture of disciplined lunacy. Good stuff.

Part II provides a series of six chapters on how to break from the pack. Dominate or leave (which does not necessarily mean being the biggest in the industry), putting the pieces together for a higher cause (which involves the customer as well as your employees), build a defiant pipeline (of products and services - this involves leading the marketplace rather than waiting and reacting), taking your customer to an impossible place (a very interesting notion of the level of expectations and exceeding them in a certain way), take innovation underground (your innovation has to be in your processes and in back of the house, as well. But EVERYTHING has to be for the effect it has on the customer, not for some vague notions of cost cutting or some program), and consolidate for cool (not accounting benefits).

The third part is a chapter on a 12 step recovery program so you can become the Leader of the Pack and an epilogue.

I really enjoyed the thinking in this book and the way the author illustrated his points. He uses good case illustrations from real world companies. And I was actually thrilled in his insistence of focusing on PROFITS rather than being distracted by other measures. You can increase your revenues and lose money. You can increase market share and lose money. You can do lots of things including manipulating your accounting and lose actual money. However, if you are actually making money, good things happen to your company, to your company culture, and to everything else you do.

This is quite an enjoyable book for those of us who are interested in business and what it takes to win in the marketplace. Why slog it out when you can be out front where the air is good and no one is stepping on your feet?

Recommended.

Everywhere, products and services are being imitated. Whatever an organization is doing and providing today is right now becoming imitated and commoditized, and, therefore, will inevitably require significant change.

To sustain a competitive advantage in this "Copycat Economy," companies must break from the pack by differentiating themselves from their competitors. They must build cool, compelling products and attempt to always stay way ahead of their competitors.

The book, `Break from the Pack', by Oren Harari (The Leadership Secrets of Colin Powell), is about how to be the leader of a company that breaks from the pack.

In every industry, says Harari, a very small number of organizations are fast, fit, healthy and clearly at the forefront. These groups are clearly ahead of "the pack". The bad news is that in a global free market, the pack is bigger than ever before! The pack grows, more players join in, constantly checking each other out and mimicking each other's movements. The result is the Copycat Economy, where everyone has access to the same resources and talent, and where imitation is rampant.

According to the author, faced with this plague of imitation, business leaders reflexively resort to actions that plunge their companies further into the Copycat Economy. Some of those actions leaders should avoid are:

1. The Compulsion to Cut Prices: Lowering prices to keep customers from migrating to your competitors decimates a company's margins and trains customers to wait for another round of price cuts before buying. When one competitor copies the other's price-cutting sales promotion, both fall prey to the Copycat Economy.

2. The Compulsion to Get Bigger: The key predictors of corporate success is not the size of a company's tangible assets (its balance sheet), but the size of its intangible assets like its speed in execution and customer care, its culture of constant innovation, and its agility in capitalizing on opportunities. The companies that dominate don't dominate because they got big. They got big because they dominated!

3. The Compulsion to Ask Customers What They Want: Breaking from the pack requires you to lead customers to a place they didn't ask to go and didn't know existed. How many consumers would have assured Howard Schultz (Starbucks) they would stand in line to spend $4 for a cup of coffee in a paper cup?

4. The Compulsion to Use Legal and Political Force to Protect Your Business: If companies rely on legal and political force for competitive advantage, they are doomed. Lawsuit and protectionism strategies drain a company of resources, money, vision, and the urgency to reinvent itself in the face of new technological and competitive realities. A company must proceed "as if" there is no "protection" because, ultimately, there isn't.

5. The Compulsion to Do Anything as Long as You're Doing Something: Many businesspeople respond to the Copycat Economy with manic bursts of action, such as acquisitions, restructuring, downsizing, outsourcing, or new alliances. It doesn't matter whether there's any strategic discipline as long as action happens. "Do whatever it takes to get the numbers Wall Street wants" becomes the message. When a company goes down this track, the inevitable setbacks begin.

The best concept I found in this book was about the Madonna and Willie Nelson Effect.

The singer Madonna has been spectacularly successful. What is her secret? Harari says that Madonna reinvents herself by keeping her antennae attuned to the culture, norms and behaviors that groups are currently experimenting with. She is always evolving; she never stands still. Every two years she comes up with a new look, a new way of presenting herself, a new attitude, a new act, and a new design. And every time it is successful. According to Harari, that is the mantra that applies to any business that wants to break from the pack. The essence of the Madonna Effect is, "Don't just respond to your customers; lead them."

In the late 1980s, singer Willie Nelson was asked about how he "knew" that his leadership on "outlaw" music would be so successful. He replied, "Being a good leader is finding a bunch of people going in one direction and jumping in front of them."

I found the Madonna and Willie Nelson Effect the most inspiring passages in this book.

So what kinds of organizations are successful in this copycat economy? Harari says that organizations that break from the pack are curious, cool and crazy.

Curious: If the strategic direction of your organization can be described as daring, bold and adventurous, then you're on the right track.

Cool: What you do, what you make and how you do it all must be perceived and experienced as cool by your employees, customers and investors.

Crazy: "You can't proceed in a calm, rational manner," said Jack Welch to The Wall Street Journal. "You've got to be out on the lunatic fringe." In the world of business, today's lunacy is tomorrow's conventional wisdom.

Harari also stresses the importance of carefully choosing your team. He says that leaders must choose the best people with the greatest talent. In other words, they must enlist champions. Leaders should scour the landscape not for people who can "do the job," but for maniacs who, without being asked to, will transform their jobs on behalf of the team, not their own egos.

Finally, Harari discusses the importance of one's customers. He says that leaders must be able to convey to their employees that the prime purpose of their jobs is to help make customers very, very happy. Peter Drucker always said that the only reason for a company's existence is to create and serve customers!

This is a great book for all leaders struggling in this copycat economy!

As they say, if you're not out front the scenery never changes. This book will really help guide your thinking on how you can change your business to stay in front of the competition. It's a quick read, with interesting real life examples. Yet it makes it's point and gives you things to think about in relation to your own business. Well worth it.