Imitation is More Than Flattery

It’s good business. In fact, for most businesses, it’s good innovation. Innovation is difficult and costly for most businesses, and most innovators are unable to capitalize on their innovation to become the market leader. In contrast, most of the market leaders are companies that perfected innovative imitation, where they come up with cheaper and better versions of the innovative technologies developed by their competitors (which use new and improved technologies and processes that “invent around” whatever patents the competition might possess).

Good examples are given in this Harvard Business Review article which explains why imitation is more valuable than innovation. McDonald’s imitated and perfected a system pioneered by White Castle; Visa, MasterCard, and American Express all learned from Diners Club; and even Wal-Mart’s founder admitted that he borrowed most of their practices from predecessors, improving and combining them into a winning formula. In other words, today’s lions are the descendants of copycats.

However, as pointed out in the article, success is more than just a cheap knock off (even though that may work in China). As the article points out, the art of “true imitation” requires one to develop the capabilities that enable its effective use and to learn to deploy imitation strategies. True imitation is a complex and demanding process that requires high intelligence and advanced cognitive capabilities. It’s a form of innovation in its own right … and one that an organization needs to master if it’s not effective at coming up at truly original ideas.

But even more than that, it’s the foundation of a great supply chain. A great supply chain is built on best practices that are derived from the innovation of others and improved over time.

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