A colleague gave me an interesting book, Break from the Pack, by Oren Harari (FT Press, Upper Saddle River, New Jersey, 2007). It gives tips on how an organization can get ahead in the race to success. The author says companies tend to run in packs because we are in what he calls a "copycat economy." That's because as one company becomes a success for a while, leaders of other organizations develop "me-too" strategies and the companies become indistinguishable from each other. He gives as an example Vending Supply Inc. (VSi), which designs and manufactures temporary tattoos. Before the company came along, the industry was flat. Big players were making the same old boring images of flowers and fairies. VSi hired artists to create cool images such as space aliens and smiling death heads. For several years, the company grew exponentially. But then it began to decline as everyone started doing cool art.

Harari says to stay ahead, companies have to "lead customers to a place they didn't ask to go and didn't know existed." He gives as examples FedEx, Starbucks, Palm, and Jiffy-Lube. The author says imagine if, for instance, FedEx had run a focus group in the 1970s to find out if people would spend $10 to get a letter delivered overnight

The author says Madonna is a great example of how a company can be successful. She was able to reinvent herself in anticipation of many fashions. Her "brand relies on crossing over from mainstream to the margin and showing everyone else how to do it too. She…keeps her antennae attuned to the culture, norms, and behaviors that interesting fringe groups are currently experimenting with, groups that represent the still-raw material for tomorrow's mass movements. She then discards her still-successful 'products' and persona, puts her personal stamp on her new material, packages it with imagination and organization finesse, and then leads the masses to it."

In other words, to be successful, companies must lead, not just respond.

Harari later lists what companies must do to execute a similar "Madonna Effect":

-- Take small, in-the-distance trends seriously. An example of one firm not doing this is Kodak, which underestimated how fast the digital market would overtake film.

-- Challenge what made you successful in the past. In other words, toss products that don't fit the future of the company. An example is IBM, no longer a mainframe company, but one that integrates mainframes into its 'on demand' vision.

-- Be willing to disrupt the supply chain.

A few other steps include: Don't become paralyzed by fear of going too far, listen to crazy customers, and take underserved markets and emerging demographics seriously. Also, don't be panicked by finicky investors and have the courage of your convictions.


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