Business Management Blog

Lessons from Ranjay Gulati, a professor at Northwestern’s Kellog School of Management, on how to avoid complacency:

1. Avoid the “post-pellet” pause. Lab rats always take a break when they find that pellet of food. Recognize that once an organization achieves success, it’s only natural to want to take it easy.
2. Look outside the industry. Comparing yourself only with the industry competitors can create a false sense of security. Set performance goals that are world-class, not just industry best.
3. Use internal metrics. External metrics such as market share matter. But supplement them with internal goals, such as quality and sales growth, which can be better for driving absolute, year-over-year improvements.
4. Give customers more to love. If customers already like your product, try to improve the experience that supports the product. That extends the competitive advantage of having the best offering in the market.

Source: BusinessWeek, July 2, 2007

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