|Imitation’s place in an Innovation-obsessed Culture|
Oded Shenkar is used to going against the grain of accepted norms and challenging traditional mindsets.
In his new book, Copycats: How Smart Companies Use Imitation to Gain a Strategic Edge, the Ford Motor Company Chair in Global Business Management raises an important question on whether legal forms of imitation (not infringements of intellectual property)—long maligned in the West and embraced in the East—have a place in business practice.
“The reality is with all respect to innovation, there’s no way you can innovate everywhere all the time—it’s impossible,” he says. “The point is…imitation is as important as innovation, which is why I came up with the term ‘imovation’—a combination of innovation and imitation.”
Shenkar joined Fisher 12 years ago at the invitation of then-dean Joseph Alutto, as part of a push to globalize Fisher’s program. He holds degrees in East Asian studies and sociology, as well as a PhD from Columbia University.
Copycats is not Shenkar’s first foray into publishing controversial research; in 2004 he wrote The Chinese Century: The Rising Chinese Economy and Its Impact on the Global Economy, in which he predicted that China would overtake the United States as the world’s largest economy by 2025. The project was also a springboard for his current book.
To do imitation well, companies must recognize that it’s both a systematic and creative process, requiring advanced reverse engineering and at the same time, the ability to improve on the earlier design.
Pointing to the lessons of history and other disciplines, Shenkar says time and again, companies that are imitators can save money and time, leading to market success, whereas those strictly embracing innovation risk falling behind. The key is “finding what it is you want to imitate and move on to do it swiftly,” he says.
Shenkar notes that U.S. companies were really good imitators in the 1950s through the 1970s, but “I think this capability has eroded over time.” There are exceptions. Apple’s iPad is a great example of imitation. “The iPad is not new—there were a couple of tablets out there before. This is a company whose genius is in the assembly and repackaging of existing technologies within a very profitable business model.”
Legacy U.S. airlines such as Delta Air Lines and United Airlines have tried and failed to replicate the no-frills, low-cost airline model that has made Southwest Airlines so successful. According to Shenkar, the problem was in “translation”—in trying to do a literal translation they missed critical context, or “cause and effect.” “They basically tried to build two incompatible systems,” he says.
In contrast, Ryanair, which offers cheap flights to Europe, has mastered the model without duplicating it exactly—”Ryanair is not trying to be funny on board,” he says, adding that the European airliner recently stripped the cabin of both window shades and seat pockets to lower turnaround time and save money on maintenance.
Shenkar recalls speaking at the Western Governors Association a few years back along with Michael Johanns (R-NE), then U.S. Secretary of Agriculture under George W. Bush. Johanns’ theme focused on why Americans are such great innovators and will always be, while Shenkar’s rebuttal acknowledged U.S. inventiveness but challenged Johanns on, “Where is the economic return on my innovation?”
Shenkar continued, “We need to rethink what the balance is—there are implications at the micro level and at the national level for a country like the United States that is the world’s most renowned innovator. There are also questions for human kind—if an innovator can’t capture enough return, maybe we will see less innovation.”
He says that debate is already occurring in the pharmaceutical world, where there are not enough incentives for drug companies to invest $1 billion in a new drug only to have it usurped with generic versions once the patent expires. Without enough incentives for innovators, Shenkar asks, “Where are the new drugs going to come from?”
Getting the West to embrace imitation will require a “cultural transformation” similar to the quality revolution that began more than two decades ago, when the first quality inspectors evaluated product quality at the end of the production line. It has since evolved into a responsibility of every worker.
Recently, Shenkar made his point with Fisher colleagues at a breakfast meeting, when he asked the group, “Who was the first fast food chain?” (no one knew it was Columbus-based White Castle), and “Who was the first credit card issuer? (it was Diner’s Club). Today, these innovative companies are either defunct or very minor players after more nimble imitators supplanted them.
“It’s very difficult to get the point across,” says Shenkar of communicating his imitation message to fellow academics, students and the business community.
His advice to Fisher business graduates? “Take advantage of any opportunities to go to other countries and other industries.
New Faces at Fisher
“The reality is with all respect to innovation, there’s no way you can innovate everywhere all the time – it’s impossible.
The point is…imitation is as important as innovation, which is why I came up with the term ‘imovation’ – a combination of innovation and imitation.”
Ford Motor Company Chair in Global Business Management
Shenkar’s Interview on Bloomberg
Fisher’s Ford Motor Company Chair in Global Business Management, Oded Shenkar, says that imitation, though maligned in the marketplace, often is great business.
Shenkar researched scientific and academic breakthroughs in eight disciplines from history to neuroscience and found imitation to be a primary source of progress.
Listen to the interview.