(Newell acquired a struggling Rubbermaid in 1999.) A version of this article appeared in the. It was Fords effort to win over its engineers and, most important, its massive network of 5,000 dealers. There are numerous ways to devastate a competitors profit sanctuaryfor example, flooding the market with advertising or making across-the-board price cutsbut the most effective strikes are surgical. Your competitor may attack your profit sanctuaries in response. In 1996, Rubbermaid, a $2 billion business that a few years earlier had been Fortunes most admired company, ventured to contest Wal-Marts pressure on suppliers to lower their pricesand Wal-Mart simply cut Rubbermaid off. Once Southwest was established in the smaller airports, the major carriers faced a dilemma. Will competitors be directly hurt by it? Even if they have the strength, they prefer the economies of force inherent in the indirect attack. The challenger patiently researches and develops the next technology and launches an attack, shifting the battleground to its territory, where it has an advantage. These methods are best employed in bursts of ruthless intensity. One way to do this is by adopting hardball strategies of the kind we describe below. You need to know, among other things, your own and your competitors costs and profitabilityby category, by geography, and by account. We believe the time has come to rebalance the hard and the soft. Does anyone want to bet against it? Be hypervigilant, therefore, for the early warning signs of failure or success. If you play hardball at home, then youre ready to go after competitors. Often, the hardball competitor has an economic system that is unassailable. When the dust had settled in 1996, Anheuser-Busch had shuttered its Eagle snack business. Hardball players knowempiricallywhat theirs is and exploit it ruthlessly. How do you become a hardball player? The problem, however, was that Fords dealers and engineers were entrenched groups. They know that if Steve Jobs had ignored the graphical user interface he saw at Xerox PARC, Apple Computer would never have been born. History shows that for a military force to be reasonably assured of success in a direct attack, its strength must be several times greater than its opponents. Although a lot of companies talk about competitive advantage, few are able to put a finger on exactly what theirs is, and fewer still can quantify it. This is a great mantra for hardball players. It lays out the keys to becoming an effective hardball player. Just ask the airlines that have triedand failedto copy Southwest. And they play the edgesprobing that narrow territory where society says you can play the game legally. Do you demand to hear the truth from customers, suppliers, business partners, shareholders, and employees?

Toyota has steadily attacked the Big Three where their will to defend was weakest, moving up the line from compact cars to mid- and full-size vehicles and on to Detroits last remaining profit centers, light trucks and SUVs. At the risk of repetition, let us stress once again that hardball is not about breaking, or even bending, the law. Hardball players are immune to this sort of thing. Also, you must be prepared for public scrutiny; Frito-Lays sales practices in supermarkets were investigated and cleared by the FTC. These five strategies dont constitute a comprehensive hardball strategy playbook; there are others.

But it wasnt the details of the program that made it successful. Mattel. As Wausau hoped, competitors for the most part chose to ignore Wausaus moves.

Some years back, automotive components maker Federal-Mogul began to see its profits slide. For example, you must have a clear cost advantage before attacking; otherwise, competitors can counter with price cuts that blunt the attack. Flabby rivals will posture and pout. and become the market leader in search. When you decide to gut the bear, dont be reckless. A Remarkable Way to Boost Morale and Improve Results. Access more than 40 courses trusted by Fortune 500 companies. Contrary to the reports of the companys standard costing system, low-volume parts generated far more indirect costs per unit than did high-volume partsthat is, the costs of low-volume parts had been understated and their profits overstated. Wal-Mart doesnt pull punches with competitors, either. Hardly anyone would dispute that Toyota, Dell, and Wal-Mart have epitomized corporate success over the past decade. The principle of force says that the side with the greater manpower (resources) will win. The other flanking strategy is to serve uncovered market needs, as Japanese automakers did when they developed more fuel-efficient cars. He cut the number of offerings in Frito-Lays product line by halfno more cookies, no more crackersand concentrated the companys energy, not to mention its 10,000 route drivers, on Americas salty-snack aisles. Its also important that you make the idea your own, grafting it onto your organization and getting your people to buy into it. Or a relationship with a customer or a supplier that is not available to its competitors. The big brewer had noticed that Frito-Lay, a division of PepsiCo, had been distracted by its expansion into cookies and crackers. And though they may not end up out-and-out losers, they certainly dont win. Implausible as it sounds, successfully driving up a competitors costs without his knowing is one of the marks of a true hardball competitor. They pick their shots, seek out competitive encounters, set the pace of innovation, and test the edges of the possible. Its victories both distracted JPI from any thoughts it might have had about attacking Federal-Moguls high-volume business and reduced its financial ability to launch an attack if it had been inclined to do so. It makes companies strong and vibrant. In fact, for some low-volume parts, Federal-Mogul was shipping cash..

Leap Frog toy, the Leap Pad, is a laptop-like device that teaches children age 4 to 8 reading, math, spelling, and geography in a fun way. (Come on, what are you, a man or a mouse?) Southwest chose not to attack the major airlines on their well-defended turf. Although hardball players prefer the indirect attack, sometimes they beat their competitors with the polar opposite. Meanwhile, Southwest continues to push into small cities. In December 2000, the product raced past Razor scooter to become the top-selling toy the first time in at least 15 years that an educational toy was number one. In making a stand against arch rival Microsoft, Sun Microsystems licensed its Java software to hundreds of companies and millions of software developers for all sorts of consumer devices. Indeed, any strategy that provides you with an extreme but legal competitive advantage is a hardball move. In business, it smacks of corporate moguls and robber baronsAndrew Carnegie sending armed Pinkertons men and gunboats into mill towns to fight the unions. Softball players, by contrast, may look goodthey may report decent earnings and even get favorable ink in the business pressbut they arent intensely serious about winning. It goes without saying that hardball isnt about playing dirty: You brush a batter back but you dont aim for his head; you throw hard but you dont doctor the ball with spit.

An enemys weak spots are natural targets. But to really turn softball players into hardball players, you need to create and maintain in people a hardball attitude. But hardball is not about playing beyond the lines of legality.

Wausau was helped by the traditional mind-set of the industry. What happens when an Open-Door meeting goes wrong? Wausau Papers was a poorly performing manufacturer of uncoated paper, with outdated machines and high production costs. It means bare-knuckle boxing, John L. Sullivanstyle. Then-CEO Dennis Gormley decided to look closely at the companys cost and pricing structures. Its also about the attitude you bring to them.

Example: When beer maker Anheuser-Busch began eating into Frito-Lays leadership position in salty snacks with its Eagle brand products, Frito-Lay got back into fighting shape. Softball competitors like to think that their bright ideas are sacred. Look first at how tough you are on yourself. Once, in response to Uniteds launch of a competing service in several California cities that were served by Southwest, Kelleher dispatched a letter to employees with the headline Commencement of Hostilities. Noting that United had more than 100 planes that could be hurled against us on the contested routes, he warned that our stock price, our wages, our benefits, our job security, our expansion opportunitiesare all on the line. In several cities where the competition was fiercest, Southwest employees came to work wearing camouflage outfits and battle helmets. This is perhaps the most complex and daunting aspect of hardball. So hardball players do their homework. Do you have what it takes to play hardball? Hardball players pursue with a single-minded focus competitive advantage and the benefits it offersleading market share, great margins, rapid growth, and all the intangibles of being in command. Supercomputers were installed to track and analyze consumer purchases, competitor prices, and other information. Our speakers have kindly shared their presentations from the Monash Marketing Business Breakfast Delivering on Sustainability: How to position your business for success held on Friday 25 March. Massive and overwhelming force must be the equivalent of a hammer blow: focused, direct, and swift. That might have led it in desperation to try boosting its high-volume sales to generate cash. JPI repeatedly won these bidding contests, to its detriment. And because he had cut costs, he was able to cut prices. Hardball players couldnt care less. Numerous attempts to confront Southwest directlyfor example, Continental Litehave failed. For instance, bypassing Boston, it offered service out of Manchester, New Hampshire, and Providence, Rhode Island. Wal-Mart is first and foremost a logistics company, and it established its competitive advantage in discount retailing in the 1970s with a network of cross-docking warehouses. They know their industries cold.

Ford decided to do the same thing. Toyota is so confident that its system cannot be replicated that it has welcomed competitors into its factories. No lumping of servicing intervals into a menu of Happy Meal programs for them! We kicked tail.. Traditional airlines built huge competitive strengths in their hubs; for example, United has nearly 1,000 flights in and out of Chicagos OHare airport every day. Similar moves occur in business, although no one says much about them. He took Frito-Lays considerable ad budget, which had been balkanized into regional fiefdoms, and rolled it back up into a single blockbuster sum. In the early 1990s, Anheuser-Busch attacked Frito-Lays leadership in salty snackspotato, corn, and tortilla chips. Does your company have the strategic backbone to dominate its markets? In the 1950s, Toyota copied just-in-time manufacturing techniques from Ford, ultimately beating Nissan and later becoming a major presence in the U.S. auto market. It makes competitors sweat. Softball players, by contrast, may look goodthey may report decent earnings and even get favorable coverage in the business pressbut they arent intensely serious about winning. For example, some of IBMs former mainframe rivals, such as Honeywell, chose to set up strong sales branches in medium and smaller sized cities that were relatively neglected by IBM.

Look at the titles of some recent business books. You have to improve on it. Do you look without flinching at the problems most likely to bring your company down? But certain types of fakes, particularly those that distort rivals understanding of what youre up to, represent a key hardball strategy. Fordwhich enjoyed particularly high margins on the replacement parts installed by dealers service technicianscouldnt figure out why. But its important to emphasize that hardball isnt only about the moves you make. Its not about being mean. Hardball players dont cheat. Toyota, which recently overtook Ford as the worlds second-largest automaker (in terms of volume), says its global market share goal is 15% by 2010. Indeed, the discourse around a constellation of squishy issuesleadership, corporate culture, customer care, knowledge management, talent management, employee empowerment, and the likehas encouraged the making of softball players. You can also transplant between industries, as casket maker Hillenbrand has done: It applied the methods of the Toyota Production System to casket making and transformed its industry. The following disguised example is one such case.