The Law of Nemesis is a useful concept for leaders, strategists and strategic planners. In a nutshell, the law states that if things are going well in your enterprises, you must be aware that Nemesis is lurking, since no successful effort goes unnoticed by competitors. Mark Rhodes of Strategy by Design explains the concept in this short clip of his teaching.
Click here to see Mark explain the law of Nemesis in a short YouTube video: The Law of Nemesis
Does it ever seem to you that just as prospects for your business begin to look brightest, someone will rise out of nowhere to pick off a valued client, or to introduce a product line that matches or trumps your own? This dynamic is sometimes referred to as the Law of Nemesis: “Find a good thing and count on this: a nemesis will want to snatch it from you. Nothing good is yours forever because others will always want a piece of it.”
Nemesis was the Greek goddess who meted out divine retribution for wrongdoing… especially hubris. If Nemesis believed that some mere mortal was having all the luck – or getting too much credit for things – she would find a way to smite the individual by sending bad luck and ill fortune in the direction of the offending person. The Romans, too, believed that fate will eventually punish those who have gained unmerited advantage.
All of us, of course, have the notion from time to time that the luck always seems to fall the other way. But whether these were matters of divine retribution or not, strategists know that one thing is certain: Every positive situation in life and business bears the seeds of its own reversal.
Count on this: Competitive advantages will always erode. Find a good corner for a gas station, draw some interest, and someone will open up another station across the street. Work to craft a new offering of professional services, and copy cats come out of nowhere. Design a nice blog or website, and find an exact duplicate a week later. Without question, competitors learn how to imitate sources of competitive advantage.
To stave off the Nemesis, you must find sustainable advantages. The strategist must slow the erosion of advantages, and continually seek new high ground representing future competitive advantage. Moreover, the strategist must erect “barriers to entry” to protect present advantages.
Strategic planning must include plans for defending ground, for minimizing the work of Nemesis. Companies can:
Continue to set up and defend barriers to entry in order to slow the entrance of new competitors and to stay a step ahead on the innovation curve. This can mean locking in intellectual capital and proprietary procedures. It can mean staying very close to existing customers and locking in relationships by establishing mutual trust and dependencies. It can mean making capital investments in improvements that competitors cannot match.
Another way to stave off Nemesis is through competitive intelligence gathering, so that you, as strategist, are aware of what the competition is up to and how competitors will likely react to your own initiatives. Because so much information about competitors is now available over the internet and through public domain sources, many companies are empowering their entire work force in seeking information helpful in adapting to changes across the competitive landscape.
A simple way of thinking about this is that strategic decision-making is about putting your army onto the battlefield, your company into competitive space, armed with strategic advantage - a head start of sorts. Strategic advantage is essential. Some say, as a matter of fact, "if you don't have advantage, don't compete." Then, once you are in the game and have advantages in place, be aware the Nemesis is watching and that competitive advantages always erode. Add the Law of Nemesis to your arsenal of thought as a strategic thinker, and enjoy success over the long term.