Most sporting contests culminate in a single-elimination tournament, meaning that after each match the winner continues and the loser goes home:
At the end, only one contender will be undefeated, which makes it seem logical to crown them the undisputed champion.
But this isn’t as clear and fair a process as it seems (as any NCAA football fan will agree). Being “undefeated” is actually just a result of the system itself, not necessarily proof that they are in fact better than other top contenders.
To see why, consider this extreme variant: The “sporting contest” is actually just a coin flip. The tournament will work the same, with half the teams losing in the first round, half of the remaining leaving in the second, and so forth until the final match where one team will necessarily remain undefeated.
Of course the team earning the title of “number one” is random because the contest is random, but the distribution how many teams made it to each stage and the fact that exactly one went undefeated is dictated by the tournament system.
The outcome of most sporting events are a combination of skill and luck in unknowable proportions. In fact much of why sports are exciting and suspenseful is because on any given day a lesser-skilled underdog can win (by might or luck). You could mitigate the luck factor by replaying a match a number of times and declare win/lose or tie based on statistical significance at a predetermined confidence level, but of course this is neither fun nor practical.
Business is also a combination of skill and luck in unknowable proportions, and it’s also clear that the system itself has a hand in the distribution of results. The very fact that “long tail distributions” are common in almost every industry and service type indicates that there’s systematic effects outside of the usual “luck versus skill” debate about company success.
We tend to fixate on whoever is #1, in business as with sports, tacitly assuming that the contest is mostly skill and therefore the tournament has selected the rightful leader. But I’m not so sure we know that skill/luck proportion. I’m not so sure we can assume the contest (marketing, sales, product) and tournament (the marketplace) picks #1 based on repeatable, codify-able skill-set. Same with #2 or anyone else.
Does the winner of a pitch contest have a better shot at their business than #7 who learned from the experience and is now redoubling his efforts?
Does McDonald’s have all the answers or does the #12 largest fast-food chain in the world also have something to teach us?
Is the #4253 largest company in the world not still a success story, perhaps with new lessons and perspectives?
If we don’t compare the behavior of #1 with that of their failed competitors, how do we know which decisions were important, which actually contributed to its success?
Alright, so what? When does this matter?
When someone insists you need to be “more like Google,” consider that perhaps it’s the only thing they know to compare to.
When someone insists you need to be “more like 37signals,” consider that almost no successful companies are like 37signals.
When someone insists you need to be “more like Apple,” consider that they probably have no idea what really goes on inside Apple.
More interesting is when someone suggests that you remind them of this other little company you’ve never heard of, but when you visit their website and try their stuff you realize it’s resonating with you, that this feels like a finer, more mature version of yourself, that you’re getting reinvigorated about your own business not because of their top-line revenue or celebrity status but because they’re inspiring you to become a better version of what you already are.
It’s fine to muse about #1, but let’s not all strive to become just like #1.
What do you think? Is the winner-take-all mentality actually healthy? More sides to this story in the comments.