Follow the leader

By Michael Feuer

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How many times have you stood at a busy crosswalk with other pedestrians waiting for the “Don’t Walk” signal to flash to “Walk”? How many times have you along with other unsuspecting pedestrians entered the crosswalk before the sign changed because one “leader” prematurely elected to proceed across the street? The lesson in this example is that blindly following the leader is not always to your best advantage and can sometimes be downright dangerous.

Think about where most leaders get their ideas and inspirations. Certainly, they do some analysis, read the papers, watch TV and check the Internet. No doubt, they also talk to associates, consult the usual suspect experts, such as barbers/hair-dressers, taxi drivers and probably even have periodic pillow talks with whomever, just like all of us. After digesting and distilling all of this critical data, the experts have an “aha” moment and promulgate their epiphany of the next trend, be it where the stock market and economy are heading, what the consumer will need tomorrow or how companies must change. Just as sure as the sun sets in the west, the majority of business executives aren’t much different from the people at crosswalks. Without any qualms or questions, they fall into lockstep and follow the leader before really thinking about where they’re going and if it’s even safe.

In business, wisdom is the ability to discover alternatives. Let’s examine other methods of creating a new strategy, playing the stock market, buying real estate or pursuing whatever else is your vice or pleasure. No matter what you’re trying to accomplish in order for your company to cope with change, fundamental bottom-up analysis is the best starting point. You must also think as a contrarian and create alternative scenarios that are applicable to your specific circumstance. Be creative in your thinking but not outrageous. You’re not looking for a one-in-a- million chance to win the lottery. Instead, figure out how to adapt your business to meet your customers’ altered needs and counter their resistance points.

Dreaming of “what could be and should be” has a place in your analysis process. However, your dreams must be grounded and fact-based. Look at your current business environment and then ask, “How can we do it differently from others, and how can we turn a negative into a positive?” Don’t be intimidated by what the leaders are saying and doing, but instead, study what your customers want and then figure out creative methods to deliver it in a manner that will knock their socks off.

Here is a hypothetical solution using contrarian thinking. Assume you own a health spa 50 miles from the center of town. Gas prices are reaching new highs every day while environmentalists are turning up the volume about the negative effects of gasoline on the planet. Prominent “thought leaders” aggressively tell the populous to stay close to home to save money on fuel and, at the same time, help reduce air pollution by driving less. If you simply played “follow the leader,” you’d be calling a real estate agent to move your spa from its pastoral setting to the urban center. Instead, you turn lemons into lemonade by adding free luxurious limo pickup and return service for your clients so they don’t have to pay for the gas. To deal with the environmental piece, you promote the fact that your limo is a hybrid or runs on big electric batteries and/or has a very long extension cord.

In 1929 when the stock market crashed, many investors were doing half gainers off tall buildings while others on Wall Street wisely chose not to follow and instead became buyers. After the devastating trauma of Sept. 11, New York City real estate prices plummeted over predications of pending economic doom. However, the “smart money” started buying previously coveted properties at bargain prices and eventually reaped huge profits.

Use difficult times to your advantage by challenging common wisdom and searching for innovative opportunities and solutions. Following the leader can sometimes be OK, but very seldom are the results great. Buying straw hats in the winter and not becoming an automaton follower can be very profitable for your organization and you.

MICHAEL FEUER co-founded OfficeMax in 1988 with a friend and partner. Starting with one store during a 16-year span, Feuer, as CEO, grew the company to almost 1,000 stores worldwide, with annual sales approximating $5 billion before selling this retail giant for almost $1.5 billion in 2003 to Boise Cascade Corp. Feuer immediately launched another start-up, Max-Ventures, a retail/consumer products venture capital operating and consulting firm headquartered in suburban Cleveland, Ohio. Feuer serves on a number of corporate and philanthropic boards and is a frequent speaker on business, marketing and building entrepreneurial enterprises. Reach him with comments at mfeuer@max-ventures.com.