Reverse benchmarking
The case against best practice: doing what your rivals refuse to do.
Study your competitors and match or beat them at what they do.
Do what your competitors refuse to do. Matching them on their own terms caps you at merely average.
Sutherland's provocation is that benchmarking against competitors is close to self defeating: "benchmarking is for losers." Matching everyone else on the same metrics guarantees you can only ever be marginally better or worse, never differently good. His favourite illustration is McDonald's, which he argues wins not by being the best restaurant but by being extraordinarily consistent at not being a bad one, a different game entirely from the one most competitors think they're playing.
He extends this into an argument about organisational incentives: procurement and finance functions are structurally hostile to anything genuinely innovative because innovation removes their ability to make tidy, defensible comparisons between equivalent bidders, and he warns against assuming that because nobody in an industry does something, it must have been tried and failed. More often, nobody has tried it at all.
Survivorship bias looms large here. The corpus only surfaces the contrarian bets that paid off and became conference circuit anecdotes, while equally contrarian ones that failed never generated a keynote, making reverse benchmarking look more reliable than the evidence can actually support.
280 verified insights in this theme
280 verified insights in this theme
Rory on why identical financial metrics applied across an industry drive companies toward sameness.
Rory's vulture analogy, drawn from his own writing, for convergent evolution driven by identical incentives.
Rory naming the effect of universal, self-justifying corporate metrics that serve no one's actual interest.
Reflecting on the pre-flat-bed business-class recline arms race as a case of everyone optimising the wrong metric.
Rory on the evidence that corporate breakups tend to create more value than mergers and acquisitions.
Introducing the concept via Will Guidara's Unreasonable Hospitality (coffee and beer sommeliers at a top restaurant).
Rory on how shared, platform-devised metrics push every advertiser in a category toward identical behaviour.
Rory on how the demand for measurable results has come to outrank the demand for actual business growth.
On the cost of everyone in an industry optimizing against the same single benchmark.
Using convergent evolution in vultures as an analogy for corporate isomorphism: unrelated businesses forced to resemble each other by identical narrow metrics.
Summarizing the 'reverse benchmarking' principle, illustrated just before with the Eleven Madison Park coffee and beer example.
Rory, following an anecdote about a handyman's classified ad, argues that unashamed specificity in positioning commands a price premium over generalist offerings.
Rory describes how instinctive benchmarking against competitors drives businesses within a category toward homogeneity, naming the effect corporate isomorphism.
Rory argues that a brand needs a uniquely-owned metric or it will simply reflect its competitors, reinforcing his earlier point about corporate isomorphism.
Drawing an analogy to convergent evolution in vultures: businesses optimized on identical metrics converge into identical, undifferentiated competitors.
On why distinctive, interesting businesses tend to be family-owned or founder-led rather than conventionally-run public companies.
Summarizing legal scholar Joseph Fishkin's argument that uniform, like-for-like comparison criteria create an artificial bottleneck.
On why formats fall out of use for fashion reasons, not effectiveness, and the case for doubling down on neglected channels.
Rory describes his theory that major innovations come from noticing an overlooked metric rather than incrementally improving an existing one.
Explaining why consulting firms pivoted from strategy work to large, lucrative transformation projects.
Proposing that Cannes-style award shows should become a marketplace where clients license existing creative work.
Arguing against benchmarking-driven strategy, citing Roger L. Martin's 'Benchmarking is for losers'.
Continuing the anti-benchmarking argument: great brands should be incomparable rather than marginally better on shared metrics.
On why people default to benchmarking themselves against others despite its limitations.
Arguing it's more rational to invent a new competitive arena than to fight for the top in an oversaturated one like the Olympics.
Rory introducing his approach to spotting overlooked real-estate/business opportunities (Caviar House example).
Rory's own advice, recounted via a stranger who thanked him for it.
Rory introducing the bacon sandwich restaurant concept.
Rory explaining the bacon-sandwich restaurant concept's menu logic.
Rory reflecting on the bacon sandwich / hot dog ketchup examples.
Rory on Steve Jobs and reverse benchmarking as a strategy.
Rory comparing KFC's flexibility to McDonald's rigidity.
Rory on the KFC gravy campaign as an example of reverse benchmarking.
Rory introducing the Buc-ee's gas station chain example.
Rory answering the third audience question, from the founder of cinnamon-roll brand Roll Boys, about scaling without losing founder feel.
Rory on Bloody Mary's bar and reverse benchmarking as a business strategy.
Rory on the airport-shopping-center homogenization example.
Rory's own gloss on the Goldsmith line, applied to marketing.
Discussing Positioning by Al Ries and Jack Trout and the homogeneity trap of benchmarking against competitors.
On Amazon Prime's paid-membership mechanic as an underexplored innovation.
On subscription saturation as a barrier to new streaming entrants.
On why brand partnerships are undervalued in marketing.
On why cheap, effective tactics like brand partnerships get overlooked in big organizations.
On why cheap cooperative solutions like brand partnerships are undervalued relative to costly commercial ones.
Rory's mea culpa about early-career ad-agency dogma against brand partnerships.
On the strategic value of trying ideas competitors are too serious to attempt.
Advising brands to create their own success metrics rather than compete on shared industry benchmarks.
Rory on why small psychological effects, not big strategic factors, often determine business success.
Rory's airportonomics example, on airports converging toward the same design once one became the benchmark.
Rory speculating on reverse-benchmarking opportunities as everyone else automates.
Rory's Marks & Spencer's Sevenoaks trolley-coin anecdote, on siloed incentives.
Rory on the disappearance of the PA role as a false efficiency.
Rory on the dominant culture of cost-cutting and reputational paranoia in UK business.
Rory's critique of the prevailing mindset in UK business, contrasted with founder-led companies.
Rory on the pattern behind Britain's most successful companies (Octopus Energy, AO, Dyson).
Rory contrasting family-owned businesses with publicly-listed companies.
Continuing on why contrarian, counterintuitive positions have business value.
Responding to Srdjan's mention of Charlie Munger's 'less stupid.'
Applying the contrarian-betting principle to AI investment.
On how newly founded companies default to a remote, Zoom-enabled model that established companies resist adopting.
Reflecting on advertising's failure to serve startups and small businesses well.
Responding to Clapham's finance framing by asserting family-owned businesses' investment performance.
On why benchmarking around the same metric creates opportunity.
Explaining the mechanism behind reverse benchmarking.
Discussing Roger L. Martin's 'Benchmarking is for losers' essay.
Continuing the consequences of universal benchmarking.
Concluding the axis theory point.
On the homogenizing effect of purely logical strategy.
Concluding the point about logic-driven homogenization.
On strategy under winner-takes-all dynamics.
On strategic options given winner-takes-all effects.
Continuing the discussion on differentiation strategies.
Introducing the idea of 'reverse benchmarking' via the example of the inventor of Brazilian Jiu-Jitsu finding an unexplored gap in martial arts.
Describing a Cornish taxi driver who rewrote his employer's algorithmic delivery route each day using local knowledge.
Criticizing supermarket self-checkout as an efficiency drive that ignores what shoppers actually value.
Summarizing engineer Guru Madhavan's four-stage model of how efficiency tools harden into unquestioned ideology and eventually collapse.
Invoking Goodhart's law while describing the final 'trap' stage of Guru Madhavan's efficiency model.
Applying Iain McGilchrist's left-brain/right-brain framework to Adam Smith's pin-factory model of the division of labor.
Recounting seeing a mobile gas tanker refuel coders' cars in a Facebook car park in Menlo Park so they never have to stop coding.
Responding to an audience question about effective altruism.
Arguing brands need metrics that are uniquely their own, not just industry-standard ones.
On why over-investing in customer service is an easy win.
Citing the book Positioning on why category leadership carries disproportionate advantages.
Drawing the conclusion from the winner-takes-all effect: create your own category rather than compete in someone else's.
Introducing the concept of reverse benchmarking via Moxy Hotels.
Critiquing the downside of conventional benchmarking against competitors.
Explaining farmers' markets as an economically illogical but psychologically explicable reaction against retail homogenization.
On gratuitous eccentricity as differentiation, illustrated by AO's van bears.
Closing statement of the talk's 'optimize for surprise' thesis.
Closing argument for why surprise, by definition not strictly necessary, is what differentiates.
On why founder- or family-led businesses can define their own timelines and success metrics instead of deferring to quarterly analysts.
Advising caller Andrew, a startup founder, on marketing spend, then critiquing tech-world orthodoxy around automation.
Arguing that tech-world resistance to physical direct mail is ideological, not empirical.
On the strategic advantage of using unfashionable channels like direct mail that rivals won't imitate.
Concluding the anecdote about a tech company calling its own direct mail 'annoyingly effective'.
On politicians' fear of 'crossing the line' in public statements, building on a point about media rules Tom raised from his time in government.
Rory's proposal that gives the episode its title.
On the counterintuitive rise of podcasts despite unlimited music access.
Contrasting most jobs with advertising's incentive structure.
The punchline contrast to conventional-solution jobs.