Mastering The Practice of Creative Swiping to Achieve High Profit Growth



Ed's Ink
01/02/2019

Mastering the practice of creative swiping to achieve high profit growth

It's true: We live in a business world that increasingly worships innovation. Why? Because it is essential to sustaining long-term growth and profits.

But before all our energies and imaginations are too one-sidedly directed at the creation of innovations, it is useful to look at the realities of business life.

Harvard's Ted Levitt, Peter F. Drucker,  and Tom Peters continually pointed out in spite of the extraordinary outpouring of new products and new ways of doing things we are witnessing today, the greatest flow of newness is not newness at all.

Rather, it is creative/innovative imitation and/or creative swiping.

Innovation may be viewed from at least two vantage points – namely: (1) newness in the sense that something is never been done before and; (1) newness in the sense that something has not been done before by the industry or by the company now doing it.

Strictly speaking, innovation occurs only when something is entirely new, having never been done before. True innovation is rare.

A modest relaxation of this definition, noted Ted Levitt, may be allowed by suggesting that innovation also exists when something that may have been done elsewhere is done for the first time in a given industry.

On the other hand, "whenever competitors in the same industry subsequently copy the innovator, even though it is something new for them, this is not innovation; it is imitation."

Every organization needs a balanced policy of both innovation and creative imitation.

The Need to Practice "Creative Swiping"

A simple look around quickly shows creative imitation is not only more abundant than innovation, but actually a much more prevalent road to business growth and profits.

A classic New Yorker cartoon sums this up best with the caption: "What we need, gentlemen, is a completely brand-new idea that has been thoroughly tested."

We all talk about the need to innovate; but truly prefer a proven, tested idea we believe has met the market test

We much prefer to get a piece of the growing market rather than create a new market. Yet the biggest profits always go to the true innovator who knows how to defend their existing market from inevitable newcomers and established rivals.

Self-Defeating Organizational Behavior?

Most seasoned executives know It's much harder to get support for a novel idea than it is for an imitative one.

People who aspire to high places learn very quickly It’s better to avoid high-leverage projects that might go wrong than take them on with the knowledge if things do go wrong, management might not be so forgiving.

Understandably, and without realizing it, most management teams have a higher opinion of people who succeed at low-risk tasks than people who failed at high risk tasks.

It's much easier to attempt to improve operational efficiency and the like than create a new and different business or method of operation.

Unfortunately, just improving operational efficiency is not enough given our rapidly arriving and inevitably disruptive future.

As we will see in this and future issues of Management Matters Network organizations have to continuously identify & exploit successes, practice creative imitation, & organize for purposeful innovation.

Make It An Organizational Policy: "Swipe From The Best With Pride"

Let's be crystal clear: Every organization must learn to copy (with unique adaptation/enhancement) from the best! It also must innovate.

Drucker and Levitt pointed out "creative/innovative imitation” is clearly a contradiction in terms. What is creative must surely be original. And if there is one thing imitation is not, is 'original'."

Boiled down to its core meaning: creative swiping is a management practice that calls for waiting until someone else proves there is a market for a new product or service, but thoughtfully identifies weaknesses in the originator's offering… and then goes to work on improving upon the originator's innovation.

David Ogilvy's Summary Of Creative Imitation

David Ogilvy, founder of Ogilvy & Mather, was a true marketing genius. Here's what he said:

"If particular market category is growing by leaps and bounds, was very few brands in it, it is possible to introduce a 'me too' product successfully… But the risks are great…

…' Second' brands in a market typically get only half the share of the pioneer – unless the second brand spends outrageously more…

… It is usually better to wait until you have a product with a real difference… The difference may be in terms of better performance or better quality

… The difference may be better value… It may be providing a new use or new service (surrounding the basic product)… It may consist of solving a problem which other brands do not solve…

… Too many products have only minor technical differences can only be perceived in a laboratory… Use research to make sure that consumer can see what's different about your product when they use it and that this difference means something to them…"

Take-home message: Perhaps the term "benchmarking best practices" has legitimized the need to continually "swipe from the best with pride."

Peter F. Drucker has shown the success of many of today's Fortune 1000 companies owes to systematic, disciplined "creative swiping."

In the final analysis, the sum total of all the creative swiping of best practices (from different organizations) truly creates a different organization.

Tom Peters forcefully hammered home this message when he said:

"Put NIH (Not Invented Here) behind you – and learn to copy/adapt adopt from the best… Become a 'learning organization'… Shuck your arrogance –' if it isn't our idea, it can't be that good' – and become a determined copycat/adapter/enhancer…"

Pioneers sometimes get killed by the Indians. Successful businesses must expect hordes of imitators to enter the marketplace with slightly different versions of their innovation. Said Drucker: "The creative imitator exploits the success of others…"

Innovative imitators (as opposed to me-too imitators) inevitably attempt to supply something truly different than the originator (e.g., a different distribution channel that reaches a different target audience or adding a set of value-added services that differentiates they are offering from the originator's offering).

Take-home message:Executives must be taught to put NIH (Not Invented Here) behind them – and learn to aggressively seek out the knowledge of competitors and interesting non-competitors that have demonstrated success.

And innovative imitation is not limited to business. Every institution including government would be wise to practice "creative swiping" with respect what's working. The question should be: " Will it (with a twist or two) work for us?"

More On Government's Use Of “Swiping From The Best With Pride”

We’ll Hear More and more these next few years about "reinventing government agencies," that is, about making the government more effective (i.e., doing the right things) and efficient (i.e., doing things right).

Indeed, one only has to look at the VA to see what's likely to happen in the majority of government agencies and their respective bureaucracies.

Creative imitation or adapting best practices from business organizations worldwide is now a major priority in most government agencies.

We sincerely believe the Trump administration is slowly, but surely, developing a point of view, concepts and five distinct approaches for finding what should be done and how to go about doing it with respect to "reinventing government agencies."

These approaches include requiring each and every agency to:

  1. Develop specific/quantitative goals for each program and project within each agency.
  2. Establish priorities within its targeted objectives, so it can concentrate its effort.
  3. Develop policies for abandoning the outworn, outgrown, and the obsolete.
  4. Streamline and reengineer (i.e., redesign) mission-critical processes in order to meet new standards of performance.
  5. Outsource to not-for-profit and for-profit organizations that can do the job better and cheaper than government bureaucracies (however, government agencies still must develop the skills and metrics to manage the outsourced activities).

These activities are, in essence, Drucker's prescriptions for making government more effective and efficient. And they are being successfully implemented by the VA and several other agencies.

But not without resistance. Even when they are being shown to produce extraordinary results. (We will discuss these activities in detail in a near-future article).

It should be mentioned – indeed, emphasized – Drucker believed if these prescriptions are thoughtfully and thoroughly implemented substantial cost savings – sometimes as much as 40% of the total expenditures in a government agency could be eliminated.

In fact, others have asserted these five prescriptions (which have worked wonders in organizations of all kinds and sizes) could eliminate the federal deficit within a decade. The main result would be a change in government's basic approach.

All they have to do is creatively imitate the successful management practices of the world's best-run businesses. If competently executed, America would be well on its way to significantly reducing the accumulated public debt (which is now approaching $22 trillion).

President Trump – A Seasoned Practitioner Of Creative Imitation

The following story told many times by Donald Trump illustrates the power of “creative imitation” and how this simple concept could/should be used by governmental leaders.

David Kupelian, a noted journalist and celebrated author, wrote in 2016 an article entitled America's Knight In Shining Armor?:

“The Wollman Rink was a heavily used public skating rink which had fallen into disrepair in 1980.

New York City tried for six years to fix it, spent $13 million, and the rink still was not ready to open.

In June of 1986, Mr. Trump, who could see the rink from his apartment, finally got tired of the embarrassment and offered to fix the rink at his own expense.

At first the city turned him down because its bureaucracy did not want to be embarrassed by someone fixing something they couldn’t fix. Mr. Trump kept pushing and finally out of embarrassment the city gave in.

The key part of the story is Mr. Trump’s reaction to being put in charge. He promptly recognized that he didn’t know anything about fixing a skating rink.

He asked himself who built a lot of skating rinks. ‘Canadians!’ he concluded. He found the best Canadian ice skating rink Construction Company.

When the Canadians flew in to assess the situation, they were amazed at how bad the city had been at solving the problem. They assured Mr. Trump that this was an easy job.

Mr. Trump fixed the 6-year-old embarrassment two months ahead of schedule and nearly $800,000 under budget. (The city did end up paying for the work, and Mr. Trump donated the profits to charity.)

Our point? This is the kind of thinking that America's government agencies desperately need. We suggest reading Kupelian's full article to understand the enormous implications of what Tom Peters imaginatively labeled “swiping from the best with pride.”

In Conclusion

Creative imitation is not limited to businesses. Every organization – and probably most importantly government agencies – must now practice creative swiping to achieve tremendous increases in performance, in quality, in service while simultaneously reducing result-less spending.

In the months to come we will explore this & other strategic topics in great detail. Act now. Become a member of Management Matters Network – and enroll a team of key people in your organization – today!