How David Beats Goliath

by Malcolm Gladwell

http://www.newyorker.com/reporting/2009/05/11/090511fa_fact_gladwell?currentPage=all



".......David’s victory over Goliath, in the Biblical account, is held to be an anomaly. It was not. Davids win all the time. The political scientist Ivan Arreguín-Toft recently looked at every war fought in the past two hundred years between strong and weak combatants. The Goliaths, he found, won in 71.5 per cent of the cases. That is a remarkable fact. Arreguín-Toft was analyzing conflicts in which one side was at least ten times as powerful—in terms of armed might and population—as its opponent, and even in those lopsided contests the underdog won almost a third of the time.

In the Biblical story of David and Goliath, David initially put on a coat of mail and a brass helmet and girded himself with a sword: he prepared to wage a conventional battle of swords against Goliath. But then he stopped. “I cannot walk in these, for I am unused to it,” he said (in Robert Alter’s translation), and picked up those five smooth stones. What happened, Arreguín-Toft wondered, when the underdogs likewise acknowledged their weakness and chose an unconventional strategy? He went back and re-analyzed his data. In those cases, David’s winning percentage went from 28.5 to 63.6. When underdogs choose not to play by Goliath’s rules, they win, Arreguín-Toft concluded, “even when everything we think we know about power says they shouldn’t.”

....David can beat Goliath by substituting effort for ability—and substituting effort for ability turns out to be a winning formula for underdogs in all walks of life........."

Interesting article with ramifications on us as the perpetual underdog with little resources. Question is, are we still playing by Goliath's rules or should we be exploring more blue oceans?

Blueprint to a Billion

One of our colleagues, SQ, received this book on his trip to Kaufmann Foundation last year. Finally got down to reading it, and here is a quick summary of some of the points in the book. There is however a great website here which you should check out.

1) Create and Sustain a Breakthrough Value Proposition

• Shapers of a New World, truly create new paradigm for their services and prods
  
• Niche Shapers, follow NWS with products and services that redefine specific market segment
  
• Category Killers, optimise with a better-faster-cheaper alternative
  

2) Exploit a High Growth Market Segment
What I found surprising here was that the top blue print industries were in service industries, not high-tech as one would expect. The top list goes (in descending order)... specialty stores, property and casualty insurance, health care facilities, data processing and outsourced services, healthcare services, regional banks, apparel retail, REITs. Surprising huh?


3) Rely on Maruqee Customers to Fuel their Revenue Powerhouse
- companies distinguished themselves with how they dwelt with their key customers, and how they got customers to sell for them.
e.g. Cisco landing Solomon Brothers
Marquee customers help by being

1. Product consumer by testing and deploying product
   
2. Codeveloping the value proposition making sure that it actually works
   
3. Serve as a reference to facilitate sales to their peers
   

4) Leverage on Big Brother Alliances for Breaking into New Markets
create complementary win-win relationships with their bigger counterparts.

5) Become Master's of Exponential Growth

6) Inside-Outside Leadership pairing of Management Team

7) Board Composition of Essential Experts