In his latest New Yorker article, "How David Beats Goliath," Malcolm Gladwell tells stories of how outmatched underdogs beat their much larger, more experienced competitors. He begins with the story of an inexperienced 12 year old girls basketball team that went all the way to the national championship game by running a relentless full court press every game. He moves onto the story of David slaying Goliath and cites some fascinating research by Harvard political scientist Ivan Arreguin-Toft who studied every war fought in the last 200 years that pitted strong and weak opponents against each other. On the whole, the underdogs won 28% of the time. When they recognized their weaknesses and adapted their strategies to compensate for them they won 64% of the time.
Pretty stunning, huh? Gladwell's article got me thinking about what leaders need to learn from underdogs. Over the past seven months, as the Federal government has taken a much more active role in stimulating the economy, reviving the financial services sector and restructuring the auto industry, we've been regularly reminded of Richard Nixon's observation in 1971 (and Milton Friedman's before that) that, "We are all Keynesians now." As we move through the downturn and into recovery, perhaps leaders need to adopt the mindset of, "We are all underdogs now." With that in mind, here are three success rules of underdogs that can help leaders facing long odds.
Get Real: Underdogs have a much better chance of winning when they honestly self-assess their strengths and weaknesses in the situation. When Arreguin-Toft broke his 200 year study of war down into 50 year increments, he observed that underdogs have been winning at a higher rate in the past 100 years. Why? Because they better understood their weaknesses and adopted insurgency strategies against their much larger and better equipped opponents. Think back to the pre- Petraeus period in Iraq for an example of this.
Go Where They're Not: In their book, Blue Ocean Strategy, Chan Kim and Renee Mauborgne offer an underdog's handbook for succeeding by going where the competition isn't. Rather than competing in the red ocean (think of sharks fighting for the same food), they talk about creating blue ocean opportunities. Take online music as an example. It wasn't long ago that the Recording Industry Association of America was filing law suits against 15 year olds for downloading music from free file sharing sites. Enter Steve Jobs and Apple who said, "How about if we create a service where you can download all the songs you want for 99 cents each?" Five billion downloaded songs later, Apple's changed an industry and created two "must have" devices (iPod and iPhone) that have fed off the iTunes model.
Get Over It: Underdogs are innovators. They question the assumptions of the powers-that-be Goliaths. In the words of the famous Apple ad campaign they "Think Different." That can be a really uncomfortable position to be in when Goliath starts pushing back. The girls basketball team mentioned earlier lost the national championship game because they backed off the full court press when the other side complained vociferously and the refs started calling ticky-tack fouls. The conventional wisdom is very strong because it's convention. It's the way everybody does it or thinks about it. The cultural resistance to change can be exceedingly strong. Successful underdogs get over the need to be accepted by the keepers of the conventional wisdom. (Of course, they also pace the work from a change management standpoint, but that's a whole other post in itself.)
So, when you step back and look at what the opportunities are for your organization or where it needs to go, which of these underdog rules apply most to your situation? What underdog rules would you add based on your own experience or observation?