Startup stories: David v Goliath, where agility beats scale

The next time you hear a ‘David versus Goliath’ business story, where an emerging startup has knocked over a large, established enterprise, don’t think of an underdog that got lucky. Instead, think of a confident competitor who is more than happy to be underestimated, and used it’s own unique capabilities to out wit and out manoeuvre a larger entity.

David’s victory over Goliath, in 1 Samuel Chapter 17 of the Old Testament is the battle between the Israelites and the Philistines. Twice a day for 40 days, Goliath, a nine feet tall giant wearing full body armour and the champion of the Philistines, challenged the Israelites to send out a champion of their own to decide the outcome in single combat. But Saul, the King of Israel, and all the Israelites were afraid.

One day David was sent to the battle lines by his father to bring back news of his brothers. David was probably just a young teenager at the time. While there, David heard Goliath shouting his daily defiance, and he saw the great fear stirred within the men of Israel.

David hears that Saul has promised to reward any man who defeats Goliath, and accepts the challenge. Saul reluctantly agrees and offers his armour; David declines, dressed in his simple tunic, carrying his shepherd’s staff, sling, and a pouch full of stones, David approached Goliath. The giant cursed at him, hurling threats and insults.

David and Goliath confront each other, Goliath with his armour and shield, David with his staff and sling. David hurls a stone from his sling with all his might, and hits Goliath in the centre of his forehead. Goliath falls on his face to the ground, and David cuts off his head.

David then took Goliath’s sword, killed him and cut off his head. When the Philistines saw that their hero was dead, they turned and ran. The Israelites pursued, chasing and killing them and plundering their camp.

In popular culture, we refer to the outcome of this battle when a smaller entity has overcome a much larger adversary, and victory is held to be an anomaly. But it is not, Davids win all the time.

The political scientist Ivan Arreguín-Toft looked at every war fought in the past 200 years between strong and weak combatants. The Goliaths, he found, won in 71.5% of the cases. That is a remarkable fact, especially when the result is in the context of the sample of conflicts analysed was where one side was at least ten times as powerful in terms of armed might and population as its opponent – even in those lopsided contests the underdog won almost a third of the time.

Why, what happened? Simply, the underdogs acknowledged their weakness and chose an unconventional strategy. In those cases, David’s winning percentage went from 28.5% to 63.6%. When underdogs choose not to play by Goliath’s rules, they win, Arreguín-Toft concluded.

Entrepreneurs perpetually play the role of David against their Goliath competitors, and, just like their biblical counterpart, small businesses can defeat their large competitors by outmanoeuvring, out-imagining, and outperforming them. The business lesson is this: when underdogs choose not to play by Goliath’s rules, they win.

Entrepreneurs are perfectly positioned to operate as insurgents against their entrenched corporate competitors, because they’re more willing to take risks, challenge the conventions about how commercial battles are supposed to be fought, and are generally more alert and agile.

Large companies build assets of all sorts in anticipation of large-scale engagements, serving mass markets, but, despite their size and strength, they can be lumbering in their decision making an getting new products to market, rarely prepared to confront nimble and fast-moving adversaries that refuse to challenge them on the battlefield of their own design.

Possibly the best example is Airbnb. Large companies are often scaled to compete in the mass market, often paying less attention to niches, which can still be lucrative. All you have to do is take advantage of their ego, serve these small niches with passion and customer service, and you’ll win business.

So what’s the strategic mindset of a David in today’s market? Here are some thoughts.

Expect to win David had faith that Goliath could be defeated. Faith is simply the ability to act despite tremendous doubt. As an entrepreneur, you must never see your competitors as infallible. You must see a possibility to out perform them. If you execute and implement your competitive strategy with this mindset, success will be yours.

Self-Belief In David and Goliath the Israelites had faith that Goliath will someday be defeated but only David had the self-belief that he was the one to do it. As an entrepreneur, you must believe your business can do it. Ask yourself why not?

Another way to strengthen your self-belief is by drawing courage and inspiration from your past achievements and track record. David drew courage from his past achievement of killing a bear and a lion.

Leverage Give me a lever and a place to stand and I will move the earth, said Archimedes. Leverage is simply the ability to do more with less, and ask yourself: how can I position my business to compete favourably with fewer resources?

David knew Goliath was stronger, more skilled. He won by sheer courage, determination and focus. David asked the question; how can I defeat Goliath without engaging him in a hand-to-hand combat? That answer came in the form of leverage. That leverage was his sling.

For a small business, leverage can be in the form of personal commitment, energy and timing of response, personalised service and agile thinking. In fact, there are many ways to surpass your competitors using leverage as a tool.

Velocity Your greatest and most powerful business survival strategy is going to be the speed at which you handle the speed of change. Goliath was armed with a shield, spear and a sword but David had only a sling and a stone. Now what was the difference?

The weapons of both had the potential to kill but the difference emerged in their speed. David’s weapon was lighter and smaller, it had the ability to reach its target faster than that of Goliath. The sling and stone had the power of speed. How fast is your plan and how fast is your strategy?

Agile Strategy David’s strategy and tactics surprised Goliath, he wasn’t expecting to be confronted by such an opponent, and David’s agile outwitted and outsmarted Goliath’s ego and complacency. He wanted it more, and made it happen for himself.

Now in the game of business, you must develop a smart strategy to help you achieve your aim. You will note that David was strategic in his approach towards Goliath. His strategy was to subdue Goliath with minimal effort. To ensure the successful implementation of this strategy, David employed the following tactics:

  • He picked five stones instead of one just in case the first stone didn’t make the hit.
  • He avoided engaging Goliath in a hand to hand combat
  • He exploited Goliath’s ego and over confidence
  • He aimed at achieving his goal with the first shot
  • He took Goliath by surprise and caught him off guard

Focus on the customer as an individual Giant companies suffer when they lose touch with the granularity and simplicity of their business model, they become complacent and lazy about their approach to customers. Often the giants will make compromises in quality and service, thinking customers won’t swap to a smaller operator. Often they’re not close enough to their customer. Some distant manager adjusts a few numbers on a spreadsheet, but customers react and in a click of decimal points, they switch to a rival.

The value of an individual customer is always greater for small businesses than for large corporations, and understood as such. Your business is important to me. Make each customer feel they are your only customer, and the only thing that matters in that moment.

The primary reason is that small businesses are able to feel their own pulse, the stream of day-to-day events as they occur, you feel all of these things as they happen and can react and direct accordingly. This high level of sensitivity is unique to small businesses. The pulse gives you a sixth sense for change and how to retain your customers.

Play to your own strengths Big competitors’ perceived advantages can often mask their even bigger disadvantages, David is a lowly shepherd boy, and yet he’s the only person willing to fight Goliath. He also refuses to wear armour. Why? Because David realises that heavy armour weighs a warrior down. Goliath could easily kill David with his sword, but only if David were foolish enough to walk right up to Goliath. Of course, that’s the last thing David plans to do.

The final misconception is the idea that David goes into battle with only a sling. But it’s a highly effective weapon David has used many times to protect his flocks from wild animals. He’s not going to fight Goliath in hand-to-hand combat, he’s using his experience and expertise to fight on his own terms, Goliath can’t counter this. When David lines up, he has every intention and every expectation of being able to hit Goliath at his most vulnerable spot between his eyes.

That’s exactly what David did, walks right up to Goliath (but still far enough away that Goliath’s swords and javelin are useless) and kills Goliath with a single shot to the head. Recall, the scene in Indiana Jones shoots the intimidating Arab swordsman in Raiders of the Lost Ark – he made the most of the moment on his own terms

Take a look at the story again. The lesson isn’t simply that when a powerful competitor takes on a smaller one, the smaller one might nevertheless win by chance. Instead, understand that the real keys to competition are sometimes obscured by our misconceptions. Perceiving them correctly can amount to a new basis of advantage.

Are you facing what you believe to be a giant problem or impossible situation? Stop for a minute and refocus. Can you see the situation more clearly from David’s vantage point?

Just be yourself and use the familiar skills and talents you have. Look at the challenge from a different perspective – lean forward, how can I win? – we see more clearly, and we can fight more effectively – rather than leaning back with anxiety. What is our strategy that they can’t counter, don’t take the battle on their terms, create the conditions where you have an unfair advantage on your terms, reframe the debate.

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