At the Code Conference in Beverly Hills earlier this week, Kara Swisher interviewed Google CEO Sundar Pichai, asking him about his competitors. Swisher specifically asked about the companies competing in artificial intelligence (AI), but Pichai’s answer was a brilliant lesson in how every company should think about competition.
“I’ve always believed that you tend to go wrong by focusing too much on competition,” Pichai said. “Big companies in particular go bankrupt because they stumble internally.”
Those words may sound harsh, but they are true. Almost every business spends more time worrying about competition than it should. As a result, they spend less time on the things that matter.
Here’s the thing – most businesses eventually fail. According to the Small Business Administration, most companies don’t make it through the fifth year. The vast majority of them are very small businesses that cannot make a profit for whatever reason and the owner eventually closes the door. We hardly ever notice it unless it’s on a corner near our house, or a place we visit often.
But failure is not unique to small businesses. Big companies always go bankrupt. They go bankrupt, they fire people, they close locations, and sometimes they close their doors completely. When they do, it’s almost never because they were beaten by the competition, but because they made bad decisions or couldn’t execute.
The interesting thing about Pichai’s answer is that he doesn’t say that you should never look at what your competition is doing. He is not suggesting that your competition is never a threat. Instead, he suggests that you’re more likely to fail because of what’s happening inside your company, not because of what’s happening outside.
“You want to be aware of everything that goes out,” Pichai continued. “But in the end, your success depends on your execution.”
Or, to put it another way, you would be naive not to be aware of what is going on around you, but your job is to perform whatever you do. Focus on doing better. Focus on how to better serve your customers and create better experiences. If your competition already does, you should probably consider it — then go back and figure out where you’re disappointing your customers.
It’s not your job to look at the competition and try to copy what they’re doing. You will never be a better version of your competition, so stop trying. Instead, focus on being a better version of yourself. The good news is that your competition will never get better at whatever you do unless you stop to make it better.
“Look, I think the thing about technology is that competition comes out of nowhere,” Pichai said. “None of us talked about TikTok three years ago.”
He is right. Competition often comes out of nowhere, so you don’t see it coming. That is not possible. The thing you’re competing with three years from now may still be an idea in someone else’s mind. Instead of worrying about that, let it go – you can’t control it anyway. Instead, focus on what you can control. That’s the best chance of success anyway.