innovation
to business strategy. “Reading some of the early texts, there were very few people that noticed the importance of imitation,”
says Shenkar. “Theodore Levitt, for instance, who wrote for the Harvard Business Review, back in the 1960s, he looked at companies and he found out that the same company that had invested a lot of time and devel- oped a system to handle innovation dealt with imitation in a most amateurish fashion. That’s 50 years ago. I was shocked to find that that remains the case today. “That taboo has a lot to do with it, because if it’s taboo
Southwest Airlines. As soon as they came back they set out to copy Southwest. “I give Ryanair a lot of credit for being very open
about it, and not shying away from it. They were very, very clear about it. So they set up to copy the model, to replicate the model and then, importantly, they decided they could take it further, take it in another direction.” It is no accident that Shenkar uses Southwest among
his case studies. The low-cost US airline regularly appears in the major works on business strategy. “It’s a fascinating example. Even one piece by one of the
strategy gurus, Michael Porter, brings in Southwest Airlines as an example of a model that cannot be imitat- ed! Okay? So I figure I’m going to take that as supposed- ly the more difficult example and show you that it can be imitated.” That said, Shenkar also demonstrates in the book that there aremany companies that have tried this and failed.
Falling behind When Shenkar went to tackle this area for his new book, he began by looking to other areas of scholarship, and read voraciously “anything from history to archae- ology, art to biology, neurosciences and so forth”. “I had this feeling that maybe within the field we call
business administration, we are really missing some- thing, and boy was I in for a surprise!” he continues. “All of these different disciplines, which really range
from the humanities to the natural sciences, have gone through a transformation over time. They have started at some point by looking at imitation as something very
primitive.Now, over time they have all changed their per- spective quite dramatically, and they all have come to see imitation as a very complex and intelligent capability. “There is only one area that has fallen behind and
remains with the old perspective and that is, I regret to say, business administration. Which is kind of funny because you expect business to be ahead of the game! But we are not, and I think there are very, very impor- tant lessons to be learned from that,” says Shenkar. Whether those in business will be open to embracing
the idea remains to be seen, he says. This taboo we have already discussed is part of the problem, as it means that imitation in strategy is somewhat ignored when it comes
we don’t want to discuss it, we do it behind closed doors,” continues Shenkar. “And typically what we do behind closed doors and in the dark is not going to be dealt with very seriously, very systematically. It’s not going to produce very good results. So we are doing imi- tation, but we’re not doing it right.”
Accelerating rate In Copycats, Shenkar argues that the rate of imitation is in fact accelerating. “Many will counter argue that in a modern environment, innovation is ever more important, because the pace of, for example, product introduction is so much faster. My answer to that is that this is precisely what makes imitation also much more important. “You need only look to historical data. If you look at something like porcelain which was invented in China around the 7th or 8th century, during the Tang Dynasty, it took European nations about 1,000 years to replicate it – and not for lack of trying! “Then the further up you go, you see that the length
of time shortens dramatically, so if you think of the phonograph that Thomas Edison invented, it took about 30 years before we had the first commercial version. The compact disc – it took three years.” Shenkar looks also at prescription drugs. “It really
began in the 1960s and then it took maybe two years before somebody would come up with a generic substi- tute. Then it went down to ninemonths. Then for Prozac, it took two months. And you see it in almost everything else, whether it’s a product like a savings plan for a bank or a business model or a service.” “And it is because of this acceleration that you’ve got to
have the capability, you’ve got to have the infrastructure to actually process it, turn it into a successful imitation. But until we put our mind to it and do it in the right fashion, and systematically our chances of doing it right are really slim. “Then we fail and it’s easy to come and say: ‘Imitation
doesn’t work, imitation doesn’t pay’.Well, it’s like every- thing else, if you do it right it works.”
Copycats: How Smart Companies Use Imitation to Gain a Strategic Edge, by Professor Oded Shenkar is published by Harvard Business Press.
48 Irish Director Spring 2011
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