The Red Queen among Organizations

Competition and the Red Queen

In Lewis Carroll’s classic, Through the Looking Glass, the Red Queen explains how her country differs from normal places. In her skewed kingdom, “It takes all the running you can do, to keep in the same place.” That sounds crazy, as Carroll intended, but it perfectly describes the competitive reality that organizations face: They must work harder and harder just to stay even with each other. People toil diligently to find any advantage or improvement for their firms, and their competitors do the same, so the race accelerates over and over. Like living creatures in an ecological system, companies compete for finite resources. Thus, competition is a “zero-sum” game. When you win, someone else loses.

While all companies compete, they don’t do it the same way, to the same degree or against the same competitors. Instead, organizations compete against similar organizations. They operate like organisms jockeying for supremacy in a single ecological niche where the pressure of competition works like evolution, forcing change and adaptation. How you win in these different niches depends on the criteria your specific area uses to define...