Friend and Foe: When to Cooperate, When to Compete, and How to Succeed at Both (20 page)

Should I start a new business? Is now the time to open up that restaurant or launch that new software company I have always dreamed of?

When we make these life-altering decisions, we can't do it in a vacuum; we need to consider the competitive landscape. Part of this involves assessing our own capabilities. Most of us do a great job of asking questions about ourselves: What are
my
skills, what are
my
strengths, what are
my
weaknesses?

Someone starting a restaurant, for example, might focus on their culinary talents and their unique specialties. “Everyone loves my chicken alfredo!” However, when we focus only on ourselves, it's easy to make the leap from “I make good chicken alfredo” to “I can make chicken alfredo that people will pay for” to “I can definitely run a restaurant.”

But questions about our own talents are only one small part of the equation. Unfortunately, the second two pieces of the puzzle often receive too little attention from budding entrepreneurs. When Don Moore of UC, Berkeley, analyzed the reasons entrepreneurs gave for starting a new business, he found that most were focused on factors that had to do with themselves or their ventures, like their personal capabilities or the high quality of their product. But what they rarely mentioned were external factors like supply (their competitors) and demand (the base of customers in the market).

In other words, these entrepreneurs failed to take the perspectives of both their customers and their competitors. This lack of perspective-taking helps to explain why so many businesses fail; in one analysis,
80 percent
of entrepreneurs failed within the first 18 months of starting a new business!

Only when we look at the situation from our customer's point of view can we start asking the right questions. How many people actually like and would
buy
chicken alfredo in general? And why would customers choose
our
chicken alfredo over a competitor's?

This perspective-taking problem is so common that it has its own name: competition neglect.

How important is competition neglect? Well, if you understand it deeply enough, it could help you become an Olympic contender. It did for Eddie the Eagle (formerly known as Michael Edwards). When we think of Olympians, we often think of sculpted athletes who have committed to grueling training regimens from young ages. But this was not Eddie. He wore thick glasses, was a bit chubby, and had little athletic training. Still, in 1988, Eddie captivated worldwide audiences when he became the first athlete ever to receive a specific, individual mention during the closing speech of the Games. When the Olympic president mentioned Eddie in his remarks, “at this Olympic Games some competitors have won gold and some have broken records, and one has even flown like an eagle,” thousands in the crowd started to chant his name.

How did Eddie earn a spot in the 1988 Winter Olympics and capture the attention of the world?

He considered
relative
demand and entered a weak market. Eddie knew that competition for spots on the swimming, gymnastics, or figure skating teams would be brutal. So he skipped those sports. Instead, Eddie tried out for the British ski jumping team.

Prior to 1998, Britain had never had an Olympic ski jumping team. In fact, there wasn't even a ski jumping facility in the entire country. When Eddie tried out for the team, he had zero competitors!

As you might imagine, Eddie didn't win gold, silver, or bronze. But thanks to a clever understanding of relative demand, Eddie became an Olympian and competed on the grandest of stages.

Now let's think about how a seller might profit from understanding relative demand. Consider a question every auction seller faces: When should you end your auction? You might think it makes sense to end your auction when demand is at its highest peak. Data show that demand on eBay is highest between 5:00 p.m. and 9:00 p.m. PST. So most sellers end their auction during this “happy hour,” when absolute demand is highest.

But these sellers are making a mistake. Uri Simonsohn of the Wharton School found that profits were
lower
when demand was highest. How can this be? The problem is that every seller crowds into this time period, and as a result, competition is fierce.

You don't want to end your auction when demand is highest—in absolute terms. You want to end your auction when
relative
demand is greatest. And when is that? On eBay it turns out to be 2:00 a.m.! Although there are far fewer buyers online at 2:00 a.m. than there are at 8:00 p.m., there are also far, far fewer auctions that end at this time. As a result, every auction that ends at 2:00 a.m. captures greater attention than auctions that end at 8:00 p.m.

We can see that understanding relative demand and asking questions that reveal the perspective of our competitors can help us decide which competitions to enter. In the next section, we'll talk about how asking the right questions can help us more broadly—to resolve disputes, move up the corporate ladder, and even climb out of debt.

Surgery is never fun. But imagine waking up a few days after surgery to find that, on top of everything else, you have been hit with an $18,000 bill.

That is what happened to one of our colleague's former students. The day before a major surgery, Karen's surgeon called and asked if she would agree to have her surgery at a different surgical center. Karen decided to cooperate: “Sure, why not, if it helps you out.” A few days after the surgery, as the painkillers began to wear off, she learned that she had been billed $18,000. Although the doctor's portion of the bill had been covered under her insurance, the surgery center fees had not.

After receiving a bill like this, what would you do?

Many of us would have taken the competitive approach and flown into a rage at this outrageous bill. But Karen tried out a different strategy: Instead of blaming the surgeon's office, she called the office and asked to speak with a nurse. But instead of yelling or arguing, Karen simply asked the nurse for advice.

And a remarkable thing happened. The nurse not only helped Karen navigate the red tape of the surgical center, but even intervened and secured a complete waiver of the entire bill! In the end, Karen didn't owe a penny. Asking for advice turned the nurse from a potential foe into not just a friend but an advocate.

Asking for advice doesn't just turn adversaries into advocates. It can also help you supercharge your advocates and lead them to help you climb up the corporate ladder.

To get ahead professionally, we need to broadcast our accomplishments and talents. But there is a problem: Self-promotion doesn't always work very well; self-promoters just aren't very likable. Thus we face a self-promotion conundrum: We need to advertise our accomplishments, but when we do it we are not well liked.

How can we solve this problem?

Consider Peter, a young associate in a law firm with aspirations of partnership (the context of this example has been changed to preserve anonymity). He was invited to give a talk by an important legal society based on a law review article he had written. Naturally, Peter was flattered. But he knew that in order to prepare the best talk possible, he needed some additional support.

So Peter approached a senior partner, Jennifer, who had previously presented to this society. And he simply asked her for advice: “I was just asked to give a talk at the Law Society and I would love to get your advice on the best way to frame my arguments for this audience. I know you have spoken to this society before and I am sure you have some great insights on what would work best.”

The simple act of asking his higher-status colleague for advice yielded a number of benefits. First, she was flattered by the request and impressed by Peter's humility; she took it as an implicit endorsement of her opinions and expertise. As a result, she liked Peter more. Second, it inspired her to spread the news of Peter's prestigious invitation to all of the other partners. For the next week, other partners would stop by Peter's office to say “way to go” and “congrats.” They were all thrilled that one of their own rising stars had been selected by this illustrious society. Third, it made Jennifer more than happy to work closely with Peter to make his talk a spectacular success.

Seeking advice and another's perspective can lead to long-term benefits because it invokes commitment. Jennifer's advice represented an investment in Peter. As a result of this investment, Jennifer became more committed to his future success. This is similar to numerous studies that show that asking for a small investment at one point can help you secure a larger investment later on. Asking for a little bit of advice now will make people feel committed to your success and they'll be more likely to offer you more advice and more help later.

Asking for advice is a particularly effective mechanism to get other people to take
your
perspective as well. As our research with Katie Liljenquist of Brigham Young University's Marriott School has shown, when we ask others for advice, they put themselves in our shoes and look at the world from our vantage point. Thus, just like Jennifer, they are more willing to help us.

Although we have shown that asking for others' counsel provides strategic benefits, people are often reticent to seek it. In a project led by Alison Brooks at Harvard, we found that people fear that by asking for advice, they will appear less competent. But this is a perspective-taking failure: When we ask for advice, as long as the request is not completely obvious, we appear to be
more
competent. After all, we have just flattered someone by seeking
their
advice.

We always get asked this question: What should you do when you ask someone for advice but don't end up taking that advice? Won't the person be offended? Not if you frame it correctly. You simply need to explain that although you didn't take their advice, it was their insight that helped you think about your situation in a different light, and that their unique perspective turned out to be essential for your success. This strategy also leads to a broader insight: Follow up with
every one
of your advice givers and let them know how much their insights have helped.

Because asking for advice signals respect, it is a strategy that works equally well up and down the hierarchy. It clearly works up the hierarchy because it shows deference and respect. But asking advice of someone
below
you on the hierarchical ladder—like when the boss asks a subordinate for their opinion—can have a powerful effect as well. The person below you in the hierarchy will be delighted to be acknowledged for their opinions and thrilled to have their expertise acknowledged. And often, as we discussed earlier in our exploration of hierarchy, someone on a different rung of the corporate ladder can offer a fresh perspective on a problem or situation.

Asking those with less power for help is an effective way to empower others and make them feel valued. To understand how important this is, let's turn our attention to what happens when the powerful
don't
consider the perspective of the less powerful.

On February 17, 2014, a plane traveling from Denver to Montana suddenly and without warning dropped nearly 1,000 feet in 12 seconds. That is the equivalent of jumping off the Chrysler Building in New York. A woman flew up from her seat so forcefully that she cracked the ceiling with her head. A mother's infant flew back two rows, thankfully uninjured. A flight attendant was knocked unconscious and remained so when the plane landed.

Despite the severity of the turbulence and the free fall, nobody in the cockpit ever addressed the passengers. Not a word…only silence. This is how one passenger described how terrifying this silence was and why he desperately wanted communication, any communication, from those in charge:

The lack of information from the cockpit, and the increasing realization of how severe the incident with the turbulence had been, coupled with the progressively shaky landing, caused my fear to spike. My mind began to try to fill the information void, and I searched for an explanation for what might be wrong. I imagined that perhaps the pilot had been injured during the turbulence and that the less experienced assistant was handling the landing. I wondered if the wings, or perhaps the engines, had been damaged by the violent shaking of the plane…I raced to understand what was going on…The point is, without any communication from the cockpit I felt unsafe, and [I] was left to search for possible answers to fears that would have and should have been allayed by the pilots.

That is what happens when leaders don't communicate—our fears run rampant and we fill our heads with worst-case scenarios.

There are three mistakes that leaders and the powerful make when they communicate. Each of these can easily be corrected through perspective-taking.

The first mistake is too little communication. We just saw this error with the pilots. Had the pilots considered the perspective of their scared and worried passengers, they would have realized that even a short message would have been dramatically reassuring.

The second mistake is not appreciating that the words of the powerful, even the most innocuous phrases, are infused with portentous meaning. It is easy to forget how seemingly cryptic statements can be particularly unsettling for those in a subordinate position. To the less powerful, seemingly straightforward requests can produce unchecked worry.

Take the simple request of a boss asking to meet with a subordinate later in the day. Back in the early 2000s, Adam was an assistant professor at Northwestern University—that meant that he had power and authority over grad students but was subordinate to the chair of the department. One morning he walked by a grad student, Gail, and said, “I need to talk with you about something this afternoon. Can you come by at 3:00 p.m.?” Later that afternoon, Gail approached Adam's office with great trepidation. He asked Gail something so trivial and so minor that he can't remember what it was. She then said, “Never do that to me again!” “Do what??” “Scare the hell out of me by saying you needed to talk to me this afternoon. I spent the whole day obsessing about whether I was in trouble.” Now we might chalk this up to Gail being particularly neurotic, but the very next day, Adam got an e-mail from the chair of his department asking him to come by and see her later in the day. Adam was racked with worry and consumed with fear he had done something wrong…until he met with her and learned that the topic was trivial.

There is any easy solution to this problem: Communicate your motives so as not to activate unnecessary worry in those who have less power. Whenever you need to talk to someone with less power than yourself, explain the topic along with the request so they don't worry. Or, if it is too complicated to explain, at least put their fears to rest: “I need to see you later today, but don't worry, it is nothing bad.”

The third error is that leaders forget the powerful boom of their voice and words. As we rise in power, even our smallest gestures can have big consequences. Some call this the “Executive Amplification effect”: The softest gestures of executives get amplified and become loud, blaring, all-caps messages. A quick thank-you becomes GRATITUDE. Constructive feedback becomes CRITICISM.

By taking a moment to think about how your words might affect your subordinates, you will communicate more often and more effectively. And in the process, their worry and fear will float away like gossamer.

We have discussed how perspective-taking can help people connect to others and give others a stake in our own success. Forging these connections is particularly difficult, however, when interacting with people from different races and backgrounds. Perspective-taking can help here, too.