By McKinsey & Company – Author Talks
McKinsey Global Publishing’s David Schwartz chats with John Horn about his new book: Inside the competitor’s mindest (MIT Press, Aprile 2023)
June 16,2023/Interview
How cognitive empathy can help you predict the competition’s next steps?
.. “As I’ve worked on these topics over the last few decades, it’s stuck out that people think their competitors are irrational when they are not. We just aren’t understanding the world from their point of view. When you look at the world from their situation and context, those choices begin to make a lot of sense and aren’t irrational…”
Why is it so hard for companies to understand their competitors?
…”There are many reasons. A simple reason is that they’re competitors, so I don’t want to like them, and I don’t want to focus on them. As business leaders, we are thaught to control things we can control… …but we can’t control competitors …”
…”We can control internal operations, we can control marketing plans, and we can control the things we do as a company, but we can’t control competitors. It is scary for business leaders to think about something that’s out of their influence or control”…
…”It’s stuck out that people think their competitors are irrational when they are not. We just aren’t understanding their point of view”…
Why is competition still important in today’s world of platforms and ecosystems?
Thinking like a competitor is important for two reasons:
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One is that, depending on the country, laws can prevent you from talking directly to your competitor about what they will do. I can’t ask my competitor “What prices are you going to charge, what products are you going to introduce, or where will you focus your marketing campaigns”?
But I can ask my partners in an ecosystem. I can ask the supply chain partner “What are you doing to upgrade your system? Or I can ask my distributors “Where are you going to focus on terms of online, and how are you going to upgrade? “I can ask them anything…” Within those discussions, you would be naive to believe 100 percent of what they tell you…They are running their own companies even though they are in a partnership and ecosystem with you” …
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Second reason thinking like a competitor is important because of the concepts of value creation and value capture. Ecosystems and platforms are designed to create value. Working together like a system creates more economic value and more value for the combined entity…”
How do you really keep your mind open to possibilities?
The answer across the board was diversity of teammates. You need people with diverse backgrounds, diverse experiences, and who come from diverse perspectives. This keeps you honest.
“… you need a diverse team. You need different perspectives to ensure that you are looking at the world from these different viewpoints, or else you are going to get locked into looking at the world through your own lens” …
ABOUT THE AUTHOR(S)
John Horn is a competitive and empathetic strategist, behavioralist, and analogist and the author of Inside the Competitor’s Mindset. David Schwartz is an executive editor of McKinsey Global Publishing and is based in the Tel Aviv office.
https://www.mckinsey.com/featured-insights/mckinsey-on-books/author-talks-how-cognitive-empathy-can-help-you-predict-the-competitions-next-steps
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“John Horn breaks down the difficulties companies have in assessing competitors, the future of competitive insights, and their relevance in today’s world. “