The highest form of flattery? What imitation in the America’s Cup can teach business
Dr Jan-Michael Ross has been sailing since the age of five. He and his colleague Dr Dmitry Sharapov have been investigating what businesses can learn from head-to-head sailing competitions.
Imitation as a strategy is often looked down upon in business, but our research shows that in certain situations, it can help to keep you ahead of your rivals. Sometimes it can pay to launch “copycat” features or match a rival’s moves into different product categories or geographical markets.
We’ve studied the competitive interactions from head-to-head races in the 2011 to 2012 America’s Cup World Series – the contest that selects a challenger to take on the defender of the America’s Cup itself. Fine-grained data from the yachts, whose every move is measured many times a second, has allowed us to examine the performance implications of imitation strategies by the leader.
When a helmsman in the lead sees the opponent making a move, there’s no time to evaluate what the effect may be, and, in any case, a change in wind direction may make any current evaluation irrelevant. He or she “follows” the follower in order to stay ahead, regardless of the outcome of the opponent’s move.
Likewise, the speed of decision making in business is hotting up. When Samsung released a phone with a larger screen, Apple swiftly followed suit, even though Steve Jobs had previously stated that larger-screened phones would never sell.
So what conditions lend themselves to imitation – an undeniably defensive strategy? When there is uncertainty, it benefits a leading rival to watch a competitor just below, and match a move to retain the advantage. There’s always plenty of uncertainty in a sailing race – when the wind shifts direction or drops, for example.
Of course imitation in a sailing race can only work if the leader is not significantly slower on the water. Likewise a company has to be able to execute the rival moves that it chooses to imitate if it is to stay ahead.
But if, say, absolute, rather than relative, performance is the goal, or if there are reputational risks involved, imitation may not be an appropriate strategy. So far we’ve concentrated on one-to-one racing, but sailing races often involve a whole fleet of boats – where there’s not just one but a multitude of rivals. Our next steps are to try to understand whether imitation makes sense when many competitors are vying for leadership. Who then should a leader choose to imitate, and when will imitation be effective?
More information can be found at IB Knowledge.