Memo to CEO: Stop Competing


To:  CEO
From: Business Consultant
Regarding: Competition and You


I thought I’d dash off a quick note to you to tell you something nobody else in the company is willing to tell you.  Since I’m a consultant, your employees and management team have told me what they’re thinking in hopes that I will be the one to tell you and they can avoid personal damage if you react poorly.  In exchange for the service of telling you what your employees are already thinking, I will be billing for time and expenses.  The invoice will be on your desk in the morning.

photo credit: Victor1558 via photopin cc

Here’s the deal:  you’re too competitive!

I don’t mean you try too hard when you’re playing softball at the company picnic, nor is anyone accusing you of being competitive with other employees.  In general, you’re perceived as approachable and open to ideas.  The problem is that you’re too competitive with someone else:  your competitor.

(I will pause here to let the irony of that statement sink in.  It’s the sort of thing we consultants do.  We like to say things that are counterintuitive, yet also clever, and then wait for applause – plus the pause doesn’t hurt the billing clock…)

Why do you talk so much about your competitor?  Why have you granted the leader of a competitive company so much control over your own company?

Up to a point, your employees buy into your frequent use of sports and military metaphors to describe how you intend to vanquish your foe.  They admire the latest Successories posters in your office featuring Vince Lombardi and Douglas MacArthur.  They even enjoyed the motivational t-shirts you handed out at the last company meeting that made fun of your competitor.

But here’s what they’re starting to think about:  your competitor doesn’t pay you – your customers do.  And your employees who are on the front line of your business have a number of great ideas as to how to deliver a more awesome experience for your customers, but your near-term product plans seem designed solely to establish style points over your competitor in the market.

Let me tell you about a CEO who made a similar mistake.  I do this to make a point, and to also demonstrate the fact that I’m worldly and worth every penny that I am charging you.  The CEO I’m thinking of was not the CEO of a company – he was the CEO of an entire country – that is, if you consider North Korea an actual country, which some people don’t.

Anyhow, it’s 1986, and Kim Il-Sung (aka “Great Leader”) hears about a new hotel in Singapore called the Westin Stamford Hotel, which upon completion was the world’s tallest hotel.  This bugged Great Leader quite a bit, but something bugged him even more:  the company that constructed it, SsangYong Group, was South Korean, and if there’s one thing Great Leader hated worse than North Korean failure, it was South Korean success.

So Kim Il-Sung made a decision:  he would build an even taller hotel, and rub the South Korean’s nose in his success when they hosted the 1988 Olympic Games.  Given the fact that his decisions were always met with enthusiastic acclaim from his management team, they began construction on a new 105-story hotel in Pyonyang (given how hard it was to actually visit to North Korea, one wonders who was going to stay in all the rooms).

Of course, just as it still is today, North Korea was an abjectly poor country, and the routine famines that brought starvation to the land were only partially alleviated by shipments of food from the United States.  Since North Korean authorities didn’t believe they would be able to afford the steel for the project, they decided to frame the entire building using concrete.  (Here’s a consulting tip I’ll throw in for no charge:  if you’re worried about the affordability of steel, don’t build a 105-story tower).

And so the North Koreans began pouring huge amounts of concrete into forms to show the South Koreans that when it comes to building enormous hotels, the hermit kingdom was numero uno.

Anyhow, as you can imagine, the grand plan envisioned by the North Korean hierarchy didn’t turn out so well.  It certainly turned out poorly for the North Korean citizens (think of them as “customers”), who had some portion of their meager national wealth spent on a monument to the CEO’s hubris.  It also didn’t work out well for the residents of Pynongyang, who have had to look upon the unfinished project since it halted in 1992 due to lack of funds.

As it turns out, the North Koreans are back at it, and nearing completion of the hotel in 2013 – about twenty four years late. But at what cost?

So, in conclusion, I’d like to offer you a bit of advice.

  1. You secretly think your primary business competitor might be really smart, and you are constantly worried that his company is a well-oiled productivity machine that will rob you of your livelihood and leave you penniless.  We provide consulting services to him also, and I’m here to tell you that he isn’t as smart as you fear, and his management team is just as dysfunctional as yours, riven with petty jealousies and naked ambitions.
  2. Your competitor is not on your product advisory board.  He shouldn’t have any say in what product you’re going to build next, or what service you’re going to offer.  That’s why you have customers.
  3. Guess what?  Every now and again a customer will bruise your ego by telling you they have decided to do business with your competitor because of some feature you don’t have.  Get over it.  Multiple participants are required to make a “market”, and if you had no competition then you probably wouldn’t be selling something anyone wanted in the first place.
  4. Right now, somewhere in the world, there is an innovator who is working on something that will turn your industry upside-down.  He or she is the person you need to worry about, because when that innovation comes to market, you will join your hated competitor as yesterday’s news, and the two of you might even strike up a friendship and commiserate over beers about how great it was back when it was just the two of you and you hated each other.

I hope this helps, but since I’m off to another consulting gig after this, it doesn’t matter too much to me either way.  Just know that, as the old saying goes, you need to “keep the main thing the main thing”.

And the main thing, my friend, is your customer.

P.S. As a reminder, our invoices are payable upon receipt.

Michael Diamond
Michael Diamond is the Chief Revenue Officer at Mitek Systems (if you've ever deposited a check by taking a picture of it with your smartphone, than you probably have used Mitek's technology). Throughout his career Mike has helped companies in the mobile payments, data analytics, and financial services technology industries grow throughout Latin America, Europe, Asia Pacific, and North America. He was a Military Intelligence Officer in the USAR and is a veteran of Operation Desert Storm. He blogs about innovation, business partnerships and leadership at
Michael Diamond
Michael Diamond

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  1. Daniel Hebert says

    Love the snark and tone in this article Michael! :)

    But in all seriousness, you're right on point with your message. I read a great quote from "Purple Cow" by Seth Godin that went along these lines: "If you want to be great, don't follow case studies. In order to be great, you have to stand out, and do your own thing and be remarkable."

    It's good to keep track of your competitors, because that shows you there's a market for what you're doing. But too much focus on the competition will cloud your own judgement, and won't ever let you be remarkable.

    • md1amond says

      Thanks Daniel. We live in a very competitive society, which on the whole is a great thing. However, as we grow up playing on teams as kids, and later vying for promotions as adults, we develop an instinct to grade our productivity based upon those we compete against. It's good, every now and again, to remember that business markets do not function exactly the same as hockey games and land wars.

      Thanks also for the interesting Seth Godin quote.

  2. Gettysburg Gerry says

    Very funny, makes me wonder what the vacancy rate will be….I do however agree…to a point. I strongly believe a good leader keeps his eye on his competitors, that is part of their job. Of course one of their other jobs is keep their people doing their absolute best to provide outstanding customer service and value.
    Let me dig a little deeper, it is not the employees job to worry about what the CEO is doing, or how he is doing it (within ethical reason of course), the employees should concern themselves with their contribution to the team (company), if they want to be a CEO then they need to pursue that path. I have seen too many employees that spend all their time watching what management is doing and not being effective in their jobs.
    Now that being said, totally loved the article and I "get" the message. Well done…

    • md1amond says

      Sorry for the delayed response Gerry. Thanks for the comment! My fictitious business consultant took a bit of an extreme position to establish the point. Naturally, the leader who ignores the competition entirely will have a different set of problems at some point, so a balance is what is required. I'm glad you liked the article. I had fun writing it.

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