Judo Strategy: How to beat stronger competitors?(2)
Xing Zong: Your article “Judo Strategy: 10 Techniques for Beating a Stronger Opponent” is very well received. The kernel of this one can be summarized as the following: why do some companies succeed in defeating stronger rivals, while others fail? First, could you please tell our readers what is judo strategy?
Yoffie: Judo strategy tries to take the metaphor of Judo, in which smaller and weaker players successfully defeating larger and stronger players. Judo as a sport has three basic concepts, which we call movement, balance and leverage. When executed successfully, these principles allow small players to beat larger and bigger players. We took these three concepts, and try to connect them to the business world.
Movement starts from a notion that firms have to be fast, flexible and try to avoid head-to-head competition with stronger and larger players. We talk about three very specific tactics that would be applicable to small firms, and try to adapt the concept of movement to business.
The first is what we called the puppy-dog ploy, which is trying to look meek and innocent to avoid confrontation; second, is what we call defining the space, which means trying to play your game, not your competitor’s game. If your competitor is large, you are going to lose if you play by their rules. The third one is to follow through fast. In judo, the masters teach you that when your competitor make mistakes, you only have only seconds or less to take advantage of those mistakes. The key advantage of a smaller player has is the ability to move quickly compared with larger players.
Concept of balance says, when two players compete, they cannot avoid each other forever. In fact, there is going to be direct competition. When that occurs, the critical thing is that the small players maintain his/her game. The key concepts are, first, “grip the competitor”. The second is, avoid tit-for-tat. The worst thing that a small player can do is to respond directly to a big competitor. You have got to find ways to deflect that attack. The third one is the most important, what we call push when pulled.
The notion here is that sometimes it is possible to take advantage of your competitor’s moves and turn them to your advantage. A great example of this tactic was used by Wal-mart, which it was a small company. Twenty-five years ago they move into a contested area where they had to compete with K-mart and Target. They did not advertise head-to-head, because that would violate their game plan. Wal-Mart only advertised 13 times per year. Instead they simply put their competitor’s advertisement in their stores and guarantee lower or equal prices. In effect, Wal-Mart used their competitor’s advertising to their advantage.
Lastly, leverage is the critical principle of Judo Strategy. In Judo, as a sport, they teach you to use your hip and shoulder as a pivot, so that large competitors, using the right leverage, can be thrown to the mat. The business metaphor for Judo Strategy is that competitors have certain assets, looked at the appropriate way, can be turned into liabilities.
Xing Zong: Very clear interpretation! Jude strategy counsels challengers to keep a low profile and avoid head-to-head battles with the giants. But on the other hand, we know that this is an “attention age” or “publicity world”. You have to do aggressive marketing to make your products well known. How do you solve this conflict?
Yoffie: there is a tension, not a conflict. It is often quite possible to get the attentions from customers, without necessarily stimulating a head-to-head battle with the competitor. A lot of it depends on how you position the product. For example, we write about how Palm Computing in the early days was very carefully in explaining its product not as a computer substitute, but rather as a personal digital assistance connected to a computer. So they position it as a complement to a computer, rather than a competitor or substitute to a computer. For at least a couple of years, this made it much easier to build a market position because they avoided direct competition from companies like Microsoft.
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