Posted by Clayton Jensen
“I think if you have the ability and talent in one way, you have it in all ways. I’m not a jack of all trades; I’m a master of many. I don’t feel there is anything I can’t do if I want to.” – Evel Knievel
All great companies are focused around developing a pinwheel product. Their competitive advantage lies in creating a main product and then complimenting it with auxiliary products branded off from the original. As important as the complimentary products will be, the longevity of an organization lies in its ability to distinguish what is their pinwheel product, and by doing so, they will identify what they do better than anyone else.
Jim Collins argues, in his bestselling book “Good to Great”, that we need to base everything we do around the hedgehog concept. We need to pursue those ventures that align with three things: what we are most passionate about, what provides us the greatest return on investment, or profit per X, and what we can do better than anyone else in the world. If we only follow one or two of these ideals, we no longer are providing a solid, value proposition to our customers.
In 1976, Apple started with three people and one product, the Apple I. It was only through developing and perfecting their first product offer that they allowed themselves to create complimentary products like the iPod, iPhone, and iWatch. But what they focused on first was creating a personal computer that was easy to use.
In 1995, Jeff Bezos sold his first book out of his garage and Amazon was born. He believed that he could provide people the same product they could get in a bookstore but knew that he could do it more efficiently. With less overhead from selling direct to consumer, Bezos provided his customers a discounted rate as well as the ability to receive his product right to their front door. He then utilized the same principle to provide ecommerce solutions for almost any product for which his customers asked. His recent purchase of Whole Foods for just under $13.4 billion not only shows his ability to grow a company off of one pinwheel product, it illustrates how companies who focus initially on what they do best, can branch off into a multitude of new products, as well as new industries.
In 2006, Martin Eberhard and Elon Musk released the first ever electric sports car, the Tesla Roadster. Within only a few years they had catapulted themselves into one of the highest selling American car companies while disrupting the entire industry worldwide. It was through their success that they were able to purchase tertiary companies like Solar City while building their new battery storage facility called a gigafactory. Marc Cuban has argued that Tesla may just be a proof-of-concept for Elon Musk by showing people how important it is for us to not only create renewable energy, but to be able to store it efficiently.
What do all of these companies have in common, other than undeniable success? They started their companies by focusing on one thing, what they believe they can do better than anyone else in the world. You and I are just like these companies, at one point or another we are all attempting to find what we do best. Typically that will be found when what we are most passionate about aligns with how we can best make a positive impact in the lives of those around us, and in our community as a whole.
Our competitive advantage will not just be based around a specific job we do, it will be the way in which we best communicate our ideas. Some are better suited to verbally communicate their ideas through the written word or through giving speeches. While others will be better accustomed to share what they believe most strongly in through visual representation by the art that they create. Our advantage will transcend over any job or work we do, it will permeate itself into every aspect of our lives.
Our goal must be to focus on what we do best and then to add spokes off of our pinwheel product through complimentary skillsets and knowledge. This will not only increase the value of our competitive advantage, it will also provide more options to our customers. We need to continually growing our knowledge base on our areas of interest in order to strengthen the value proposition that we provide.
We are all pinwheel products, but our strength lies within our ability to focus first on what we do best before we branch off into what can make us better. Evel Knievel realized early on that his competitive advantage was his ability to mystify a crowd by doing something no one had done, or was willing to do, before. He then was able to continue to evolve his demand by adding new tricks to his bag of which others would pay to see.
We owe it to those around us to develop our pinwheel product so that we can create a world where a summer’s breeze keeps the whole world spinning, and that makes us feel fine.
(Evel Knievel created demand for himself by realizing that he was a pinwheel product.)
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