The Fruit of the Pineapple Tree

Reprinted from:

TRANSCOMPETITION,

by Harvey Robbins and Michael Finley

winners, Best Management Book Published in the Americas in 1995,

the Financial Times/Booz-Allen & Hamilton Global Business Book Awards

Copyright 1998 by Harvey Robbins & Michael Finley

Grafting the transcompetitive habits

Before you go about blending the best of competition and the best of collaboration, you need to know which aspects of each are best. To that end, we've compiled a couple of short lists describing what the best times to compete are, and the best ways to go about competing.

To Successfully Compete

You need to ...

• Compete outward, not inward. If you must ride into battle, do it against people who are not your colleagues, allies, and friends. There is no excuse for eviscerating your own people for the competitive joy of it. As General Electric's Jack Welch said, "Kill ABB. Kill Westinghouse. But don't kill the person at the next desk."
• Picture the universe of competition as a series of concentric circles, like a target. Proper competition occurs as far out on the circle possible. Better to compete with another company than with an division of your company. With outsiders than insiders. With strangers than friends.
• Pick your battles. Compete where it makes sense, and when it makes sense. Listen to what McKinsey consultants Joel Bleeke and David Ernst say:

• Shorten expectations. Win/lose has an inherently short fuse. No sooner does one contest end than another begins, and the more you win, the better prepared your next opponent will be. The lament of the aging gunslinger applies here: "There is "always a faster gun." The first question a World Series winner is asked is, "Can you repeat?" if victory is what you seek, be content with the short term -- there's nothing wrong with it.
• Have a tangible goal. Competition turns sick when it becomes personal, or the reason for it is unclear -- a compulsion, not a choice. Like the compulsive gambler, the compulsive competer embarrasses himself when goals fuzz over, and competing itself becomes the point of all interactions. You must have a point besides "winning." Compete for something, not against someone. A trophy, a payout, recognition, commission, promotion, a respite from other competition.
• Calibrate your firepower. Don't take an elephant gun to a turkey shoot. Don't take candy from babies. But avoid pyrrhic victories while you're at it. Choose goals that are achievable but still worthy of you. Amount of force should be proportional to need.
• Know when to stop. Alexander wept when he realized he had conquered the world. It's difficult to stop fighting once you have drawn blood, but pointless to continue after you have obtained the resources you set out to win.
• A successful gambler knows when to stop. He puts a limit on both ends of the scale: a limit to losses and a limit to winnings. Most of us can put a limit, say $200 on our losses. But when we are winning we think luck has taken over and we'll continue to win. Of course, the odds are always with the house, so stop at $200, or you will lose more in the longer term.
• Don't cheat. Fairness is important. If you're not being fair, it isn't competition, it's a rigged game. And if you're found out, as usually happens over time, the game will turn violently against you. Everyone may like a winner, but when cheaters are found out, as Ivan Boesky, Dennis Levine, and Martin Siegel were in the 1980s Wall Street insider trader scandal were, they were disgraced, imprisoned, and eventually shunned -- driven out of the tribe and left to fend for themselves. They will never compete again.
• Swearing off dirty tricks isn't a moral issue, but a rational one connecting to business success. Raising the price of umbrellas during a rainstorm will result in an easy short-term win. Angering future customers with your opportunism will make you a bigger loser in the long term.
• Defend yourself. When a competitor gives you no choice, don't hold back. But beware of the psychology of "preemptive attack" -- hitting them back before they hit you first.
• Remember your humanity. Competition is about obtaining resources (money, food, recognition), not bashing in the brains of your competitors. Healthy competition recognizes the connections between things, even as it seeks advantage for itself.
• Chill. Competition works when participants exercise restraint. Keep your eye on the ball, your objective. Do not go off on emotional tangents. Do not spike the ball, blow smoke from your finger, dance in the end zone, or taunt your opponent by insisting that you're number one. This is more than good manners, it is a matter of survival. You do not want to give whoever you just beat the motivation to come roaring back at you with everything they've got.
• Collaborate. Paradoxically, the best competitors in nature, business, and sports are those who recognize the value of teamwork in achieving objectives. In sports, the winningest teams are those that demonstrate teamwork. In business, the companies that prosper longest are those that adapt to the environment they compete in, and find ways to allow all sides to do well.

You need to ...

• Choose wisely. Collaboration is only valuable if the people collaborating are competent, and they are the right people for that task. What good is it to share crummy expertise?
• Plan. Collaboration can't overcome bad planning, or a bad idea. Managers would like for teamwork to make all their decisions smell good. But when that fails, guess what gets the blame.
• Know why your team exists. Teams lose perspective on their reason for being. They are not a team because they make a great team. They are a team because there is a job that needs doing, and they are the best people to do that job. Collaboration is not the job; it is just the means for doing the job.
• Choose wisely, Part II. Teamwork requires character. Bad people -- people who like to deceive, to cheat, to manipulate -- make lousy collaborators. A team of supercompeters or "go-to guys" is not likely to be much of a team. Someone still needs to go to them -- to pass the ball, to plan, to knit the task together. The trick here is to mix the fire of competition with the slick coordination of collaboration.
• Beware of the star system. You can't encourage collegiality if some colleagues matter and others don't. Leaders must make clear at the onset that the team rises and falls together, regardless of the heroics of individual members.
• At the same time, individuals must be given their due. Teams that allot all rewards on a group basis teeter on the brink of communism -- a brittle leveling that disincents individual excellence. Let your best people know their excellence is treasure to the team, and encourage them to help make the rest of the team as good as they are.
• Hide. Collaboration occurs best when no one is looking. Teams operating under hot lights tend to melt. If you want to encourage collaboration, get people together, explain the job, and leave them the hell alone.
• Clarify. Collaborative relationships are not managed, therefore the onus for role and goal clarity is on every member. Touch base for the purpose of clarification early and often.
• Be prepared to wait. Collaborative decisions have to take time. Group work is time consuming. Sorry, that's just the way it is with the collaborative process. On the other hand, time is transcompetitive treasure -- continuous winning occurring over extended periods of time.
• Draw dotted lines. Successful collaborations rely on fill-in team members who contribute small but critical bits of technical or other information.
• Be leery of technology. Collaboration feeds on information. Teams kept in the dark waste quickly away. While networking can link a team across the globe, the linking is not as high a quality as a team that lives in one another's face.
• Computer and software systems, e-mail, Lotus Notes and EDS constitute only a small part of this information, however. Yes, use the best technology available and affordable to you. but do not let it become your "information system." This system is conducted not through wires and silicon but from one person to the next, and across such considerable barriers as rank, distance, mistrust and interteam competitiveness.
• Think small at first. We are misled by our technology to think we can do business with one another across great gulfs of space and cultural disparity. Global team is an oxymoron. Teams can overcome great obstacles of physical distance, but first they must overcome obstacles of misunderstanding and group culture. Successful teams pretend they are close together, even when they are not, and welcome everyday confusions and disagreements as a way to surface differences and deal with them.
• At ease. Teams need time off. The idea that teams are united at the antennae like ants, subject to the continuous electrical sparking of ideas and collaboration, is goofy. An extra hour of sleep is worth three additional hours of meetings.
• Install an OFF switch. When the task is completed, the team loses its reason to team. Disband them, and form new teams to address the next job.
• Compete. When your customary mode is to collaborate, competitive action is a breath of fresh air, like a lifelong vegetarian sinking his teeth into a burger -- but be careful, as this makes some vegetarians throw up. It is a paradox, but collaboration thrives when individuals are acknowledged along with the group. Do not set people against one another, but remember that they have egos and need victories.

Is it better to position oneself as a competer or collaborator?

Neither. The best position is rationality -- to work one's way through difficulties on the basis of what you want and need, not the stance you wish to be remembered for.

The supercompeter -- the fellow at the party who bores everyone with the great deals he's haggled -- has been shut out of ten opportunities for every deal he rammed mercilessly down a buyer's throat. The supercollaborator missed out on all eleven -- hardly a prescription for success.

So be rational. Identify your baseline goal (the highest cost, in dollars, effort, and goodwill, that you can live with) and the other side's baseline goal (the lowest total price they will accept without bursting into tears).

Not every deal can be a win/win, but you can easily avoid deals whose long-term costs -- loss of goodwill, damage to reputation, guilty feelings -- outweigh the short-term advantage.

The rational way to do business, of course, is transcompetitive. How to graft the two themes into a powerful whole is the topic of the next section.

Mixing and Matching

One of the curious achievements of the human race has been genetic manipulation. Until Johann Gregor Mendelev discovered the principles of genetics in the 1840S, playing with pea plants in his monastery garden, and horticulturists like Luther Burbank later took these genetic insights into practical application, people left plants and animals alone; our role was to be their stewards and caretakers.

But once we learned it was possible to coax certain qualities out of species and to graft the best with the best, we became an acutely conscious race of creatures, playing god with every other species. Broccoli was cheerfully crossed with cauliflower. Tomatoes were bred that could survive weeks in the back of a truck. Eventually we cloned sheep.

In our native Minnesota the sour riparia or riverbank grape, which can survive winters as cold as 80 degrees below zero, was crossed with tastier grapes from California and France. The resulting wines are no threat to the fine wines of the world, but they boast great shelf life. They way these wines taste, they need great shelf life.

Great shelf life is what you want your business to have.

Transcompetition is a graft. Imagine combining two very dissimilar trees -- a pine and an apple. Get them to grow together as one and you have some interesting options:

The one tree bears edible fruit and the other produces nothing but pine cones. One is thorny and coniferous and evergreen, the other enjoys a beautiful cycle of leafing out, blossoming, bearing fruit, losing its leaves and then (apparently) dying. A rational combining of the benefits of such a graft (a pineapple tree?) would obtain the best qualities of each: an incredibly hardy tree bearing edible fruit year-round. A bad combination of qualities, on the other hand, would result in less favorable characteristics: picture yourself enjoying a slice of pine cone pie with cheese.

Think of transcompetition as the grafting of fruit from the two trees of competition and collaboration. Each tree has fruit that's good, and fruit that's not so good. Your job is to combine the best of both trees, the best attributes of each approach, for the task currently facing you.

• The will to greatness vs. the will to commonality. The best competers are keyed to win for the best reason: to be the best at the task before them that they can be. It is a natural pull that is part of their personalities. People given naturally to sloppiness and apathy never experience this "will to greatness" unless they are the beneficiaries of an electric jolt to the seat of their pants. Many impressive leaders have been driven by the will to greatness. John Kennedy's style and rhetoric typified this kind of leader: exhortative, demanding, optimistic, "Be all you can be." Dick Gregory comes at it from the other angle: "Just because you're common doesn't mean you have to be ordinary." The will to greatness seeks to put daylight between what is common and what is better. It is restless, and quick to raise objections. The will to greatness, given free rein, becomes pure win/lose thinking.

• Focus (inwardness) vs. empathy (outwardness). These are valuable but nearly opposite skills. The serious computer is capable of focusing on the task at hand to the exclusion of nearly everything else. It explains why an Olympic skater can be so good at the triple Lute and so uninformed about etiquette and common decency. Almost all our business, technological and athletic advances are made by people able to put everything out of their minds but the challenge they have set for themselves. If single-mindedness is envision, fixing on a single thing, empathy is omni vision, forever scanning the horizon for more to understand, from the outside in. Focus is inherently singular, asking "What more can I do?" whereas empathy seeks the plural point of view: everything is we. Which is more important or transcompetitive? The one that is weakest in you.
• The persistence of a serf vs. the insistence of a star. They are as different as conquistador and natives, the killer instinct and the instinct to survive.

Asked which is better, most companies will say star performers. But think again: who is usually still around after the smoke of battle subsides -- the company that knows it belongs. In business, star performers (Steve Jobs, Michael Milken, Henry Kaiser) come and go. The greater successes are the almost personality-less companies (Hewlett-Packard, Citicorp, United Parcel Service) who hunker down and vanish into the markets they serve.

Can an insistent leader manage a persistent organization? Maybe, but we can't think of one.

• Process vs. results. A results orientation is an attentiveness to the what of business: tangible prizes, quantifiable results usually involving quarterly return or percentage of market share. But a results orientation, imposed from above, is simple tyranny: "Give me my results and don't tell me how you do it."

Though process, an attentiveness to the way things are done, may seem less competitive, it is in fact much more competitive over the long term. Where a results orientation leverages gimmicks (straw into gold, restructuring, outsourcing), a process orientation leverages meaning: what can we do to align our operations with our values? While the results organization chases dollars headlong until it stumbles, the process organization pursues purpose. And because it has purpose, it stumbles less.

• An aptitude for play vs. an appetite for work. Play gets less respect in business circles than Rodney Dangerfield. Thomas Edison epitomizes the American work ethic with his famous dictum: "Success is 1 percent inspiration and 99% perspiration." You would deduce from this that Americans are compulsive toilers. But anyone who has wandered through a successful modern office knows 99% is a pretty high estimate.

Clearly, the aptitude for play, for "messing around" has always been the foundation for our inventions, improvements, strategies, and ideas, from Newton's apple to Alexander Fleming's bread mold to Art Fry's Post-it notes discovery for 3M -- a sticky substance that wasn't too sticky.

There is even reason to suspect play is the necessary precondition to successful work. Hirotaka Takeushi and Ikujiro Nonaka say that tacit knowledge (transferable knowledge) doesn't happen in a group until they first develop intimate structures for sharing implicit knowledge. Thus do Japanese business people strive to knock down social and competitive barriers through alcohol, bathing in hot springs, karaoke, and golf. Americans are less rigid to begin with, but they have always seen the value in bowling leagues, team parties, and company picnics.

There is a developmental twist to this. Humans are the slowest animals of all to mature from babyhood to adulthood, and for an interesting reason: "immaturity" appears to be vital to our nature. Our need to play is probably hardwired into us, and while it fades with age, few of us overcome it completely.

Play and business have always been intertwined. We all think of the business bon vivant like Malcolm Forbes or Virgin Group's Sir Richard Branson going up, up, and away in their respective balloons. Work hard and play hard, is the motto, and it occurs at lower levels as well. Companies like 3M have senior scientists who sole responsibility is to "play," working on projects that interest them apart from the applications the work might be put to. Honeywell hires project managers to comb through the trashcans of its play pens to examine the work underway, and to identify applications for it. Southwest Airlines' motto looks for happiness at every level: "Have fun, but ensure the joy of those around you."

Imagine what human culture would be without this streak of childishness; imagine the effect on innovation, art, entertainment, and humor. Imagine a party at which everyone is "grown up."

For many of us, transcompetition means abandoning the pain principle of advancement for its diametric opposite, a pleasure principle, of work for the fun of it.

• Opportunism vs. consistency. Capitalism is founded on the spirit of alertness: whoever exploits value first is rewarded most. The entrepreneur is the visionary who sees future value while the crowd mills around items considered valuable yesterday. The leader is also a kind of entrepreneur, only instead of seeking material value he or she seeks human value, extracting the best effort that people can give. These are competitive virtues that no naturally collaborative soul can do without.
• Consistency is also a virtue. The elimination of variation is a cornerstone of total quality management; it is the reason inspectors stood alongside production lines for years, with calipers in their hands. But consistency for its own sake quickly gives way to fetishism and obsessive-compulsiveness -- dotting every I, sanding down every burr.
• Depersonalization vs. personalization. Personalization is the talent for communicating in such a way that the person you are talking to feels the message has been custom-tailored to his or her understanding. In an organizational culture that ignores individuality, personalization is a precious skill.
• But depersonalization is also very powerful. It is the ability to see a thing without regard to its effect on you. It is wonderfully liberating to take oneself out of decision-making. When detachment comes in, out goes paranoia, disrespect, and the blindness that so often accompanies self-interest.
• A knack for monopoly vs. an attraction to sameness. Monopoly means doing something no one else is doing. We should say mini-monopoly, because the most successful monopolies are those willing to stay small. Yet another name is nichemanship, the art of uniqueness.

• Loose vs. tight. Which structure is stronger, one that is elastic but encourages innovation and experimentation; or one that achieves coherence through the imposition of order? This is an issue not for individuals but for groups to resolve. Loose relationships like confederacies permit wider latitude for expression; but tighter relationships, unions and alliances, have the power to effectively underwrite security. Let duration be your guide. If you are in imminent danger of destruction, tighten the bonds between yourself and others. If your survival issues are longer-term, loosen the line and encourage free minds to find solutions.
• The killer instinct vs. the survival instinct. Which brings us to the heart of the matter: how survival speaks to us from our characteristic location on the scale of connectedness. Some of us (Brutes) are equipped by birth with a natural rapacity, an ability to take what we need. Others of us are unable to assert ourselves as might like, because it does not seem social, or because we are afraid. The heart of transcompetition is to graft and the conscience of the group onto the daring individual; and a tooth of lion onto the timorous lamb.

Not every situation calls for you to exchange, encircle, and exact. Exchange, encircle and exact is the process you use against worst-case offenders, supercompetitive predators, when all else has failed. And even in the info age, when it is possible to exchange mnore information than in previous times, the 3E's are not a lead-pipe cinch to work.

The more customary transcompetitive toolkit is stocked with less sexy, humble processes. They are all one form or another of negotiated settlement, deals you can cut with parties you are competing against, in order to achieve greater success.

These approaches can be upscoped or downscoped to work at nearly every level, from the team level to negotiations between superpowers.

• Censure and isolation. If an entity refuses to play by civilized rules, have nothing to do with them. Whenever exchange, encircle and exact fail to achieve the results you seek, you can fall back on its short-form cousin, censure and isolation. It is a form of shunning. You don't exact a change in behavior, but you signal in no uncertain terms that you are against it.
• Arms talks. When you are dealing with an obvious enemy, one with a supercompetitive orientation, the first thing you want to do is get the guns lowered. Nations conduct arms talks to achieve this end. Companies, teams, and individuals can also conduct arms talks. The guiding wisdom from the SALT talks with the Soviet Union in the 1980s holds true for us: "Negotiate, but verify." Individuals and companies can fashion arms agreements just as countries and alliances can.
• Trade agreements. Companies, industries, countries and whole regions have negotiated agreements that encourage the sharing of information and the lowering of barriers. Spell out activities that will be condoned (benchmarking, talent-raiding, no-compete clauses, litigation), and those that will not be (espionage, deception, cannibalism). Be specific.
• Professional codes of conduct. Every mature profession is aware that there are lines its practitioners must forbid one another from crossing. Pharmacists are not allowed to raid the controlled substances jar. Fisheries are not allowed to kill off whole oceans. Partners are not allowed to fix prices. Customers -- yes, even they should be held to some kind of professional standard -- should not be allowed to return merchandise after two years of use.
• Free agency. Sports learned long after other industries that it could open up a new era of fair treatment with the abolition of restrictive regulations. As Lincoln freed the slaves, you should free your people through the abolition of non-compete clauses, and your customers from entangling contracts. In the information age, no party will long endure confinement. Open the doors, before the people inside break out and come looking for you.
• Bills of rights. A bill of rights is a statement you create outlining general principles of power in a relationship. The U.S. Constitution added a bill of rights as a "pot-sweetener" to convince colonies that the new federal government was not going to scarf up powers left lying around. A good bill of rights is an empowering tool that tells customers, team members, shareholders, and other partners in broad outline what they can expect from you, and what they can get away with.
• Boundary management. The problem with empowerment is that it is usually much too vague. Responsibilities must be spelled out with some specificity. If it is not, people will be doing things you don't want them to do, and not doing things you do want them to do. So spell it out in very specific terms. People will feel more secure, and information will flow more freely.
• Guarantees. A guarantee is a bet you make with a customer, in which you essentially out a gun to your own head. "If I fail to come through for you, I will pay you." The customer can be anyone,m from the end-customer to internal customers (other teams) to employees, suppliers, dealers and even shareholders. The power of guarantees is that they promise good results, with a heavy penalty hanging overhead if the promise is not kept. The trick is to create a promise that is specific (that limits the failure to something non-trivial), important (you don't want to ensure something your customer doesn't care about), and achievable (no sense blowing your brains out when failure is inevitable.
• Forgiveness. When a partner screws you over, consider giving them a second chance. Often we betray one another without thinking of the cost. We do it because our internal needs take precedence over the external relationship. Don't be a doormat, and invite multiple betrayals. But before you step onto the slippery slope of retribution and recrimination, consider explaining to the offending party how they hurt the relationship, and exact a promise not to do it again -- laying out the consequences if they blow it again. You don't have to forgive everyone, especially the obvious predators and tricksters. But many times, groups which have the best intentions let one another down. Try again -- it may save you from an expensive cycle of blame.

The skills of transcompetition at this level are skills of negotiating. We don't have space here for a 90-day course on beefing up negotiatinmg skills, but if you are interested, check out the bible on the subject, Roger Fisher and William Ury's Getting to Yes (Penguin Books), or Harvey Robbins' own How to Communicate Effectively (Amacom).

The New Versatility

There is no such thing as a guaranteed "correct" path to transcompetitive success, for several reasons.

The first is that there is no absolute right and wrong. A transcompetitive organization can look to the outsider highly competitive or highly collaborative. What makes it transcompetitive isn't the choices it makes, but the fact that it is making a choice. Transcompeting means moving beyond the habitual to the rational, from reactive to proactive.

Put the transcompetitive virtues before you, pick and choose the ones that best complement your skills and predilections, and what you have conducted is an experiment in rational versatility.

Versatility is the ability to do many things. A versatile organization is one in which people know what other people are doing, and have mastered some of the basic skills of the people they work with. Instead of being squeezed into a narrow silo of functionality like accounting or engineering, throwing work over the wall to the next function when they are done with it, the walls are taken down, and people begin peeking over one another's shoulder.

Think how much less time the engineer will waste on approaches that an accountant's mindset would intuitively avoid. Think of the savings an accountant can achieve if she understands the practical and well as financial implications of the numbers she is running.

Smaller companies have traditionally operated more flexibly than their larger counterparts because their people are ready to fill in as needed, across functional lines.

Versatility acknowledges that we cannot all be stars, but that we can all increase our value by being utility players, stepping from role to role as circumstances require. It is a collaborative skill providing a distinct competitive advantage.

TRANSCOMPETITION

A Business Week Book

Transcompetition: Moving Beyond Competition and Collaboration
by Harvey Robbins, Michael Finley
List: $24.95
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Hardcover, 240 pages
Published by McGraw-Hill
Publication date: April 1, 1998
ISBN: 0070530823