Apple vs. Samsung – the 5 business lessons I learnt!

This is my first double spread article in the Economic Times!! (02.09.12)

Enjoy the full written transcript just after the image 🙂

The Apple vs. Samsung battle in the California courts was no David vs. Goliath match.

This was a WWF match of two Goliaths! This was Goliath vs. Goliath!!

What did I learn sitting in the first row, as I saw the umpire raise Apple’s arm and declare it winner? I learnt 5 critical business lessons:

1. Inspiration not Imitation.

I was given a watch on my tenth birthday. I broke it on day three. A few years later, I got a pale looking ‘Citizen’ watch that looked as if it had been found in the trenches of the World War 1. It made time look sad.

Just when I became a teenager, I saw my first Swatch (the funky, plasticky, cool looking range of watches that came out in 1983). The watch made me fall in love with time!

I felt like taking my Citizen watch and officially cremating it. Swatch was not a Watch. For a teen like me, it was an indulgence, an aspiration. It was ‘coolness’.

Oh, reading the time on my Swatch was like the best thing I had ever done. When I hung out with friends, I would check the time every minute (to show them that I had a Swatch)!

Swatch was inspired by something the dinosaurs wore (called a watch). Swatch inspired, not imitated. It changed the meaning of a watch.

In business, we so often imitate the ‘competition.’We match their prices, their trade practices, hey even the way their sales guys dress. But do we really create any value for ourselves by imitating others?

Steve Jobs was inspired by calligraphy, by emptiness, by Zen, by the Autobiography of the Yogi, by being a hippie, by so many diverse things and people. He translated and channelized that inspiration into creating iconic products.

Lesson – inspiration is what creates value. Imitation is what reduces value. Inspire yourself in your business and the world will respond!

2. Delight leads to Design; not the other way around!

For 17 years of my cognitive existence, I never cared for my telephone. It was a piece of black coal tar that sat in the living room. Its dial would be stuck and its line perpetually dead. Once, the telephone department replaced the black thingy with a moss green coloured phone. It looked like a frog with pneumonia. Moss green colour repulses me ever since.

Come 1998, things changed. I was spellbound by a little grey box called ‘mobile phone’, made by Nokia! I was so delighted by the fact that I could call anyone, anytime, from any place! As far as the design goes, I clearly remember what my first Nokia looked like because it had an antenna that got bent on the first day itself. Errr…I sat on it!

Now tell me, would you ever buy a phone with an antenna that would tend to bend? Heck, would you buy a phone with an antenna at all?! You would not today, but in 1998 we all did! Delight preceded design, even like it does today.

The point I am making? When you delight a customer, design follows. The first mobile phone was a phone that delighted me, design be darned! The next came the clamshell that I assume was to cover the keypad and protect me from accidentally dialing my mother in-law all the time.

The QWERTY keypad helped me type mails fast. Blackberry’s roller ball (the world’s only ball that never rolled), helped me scroll through mails rapidly.

The best businesses busy themselves by delighting their consumers. Then they ‘design’ their product (be it a phone) or a service (the way you stand in a queue to buy a McDonald’s burger). They never design first and delight later.

In the tragic case of Samsung, the war of mobile phone delight had already been won by Apple. Copying Apple’s ‘design’ proved not just stupid but also punitive for Samsung.

Lesson – focus on delighting your customer in new, meaningful ways. Design will come naturally and easily; almost as if guided by nature.

3. There was only one Charlie Chaplin.

It’s said that Charlie Chaplin once personally participated in a ‘Charlie Chaplin look-alike competition’. He came third in the contest!

Does that mean that the first and second prizewinners were better than Charlie Chaplin? Of course not! Charlie Chaplin was not who he was because of his looks. He was who he was because of his soul!

Apple and its products have a soul. You can sense it when you go up to the App store and check out the zillion amazing apps that you can download for free and keep yourself occupied all the time.

These ‘not so easy’ to make apps are made by developers like me who ‘bond’ with Apple. We have a heart that beats to Apple’s soul. We know what the Apple community wants, because we are the community!

When an iPhone app does well, it makes you feel like the President of the United States, because everyone claps, adores, salutes and worships you!

Now, souls cannot be transplanted into one another like kidneys. If you rip the soul of any business, product or service and inject it into your own, you will have a huge problem.

Take for example the app store of Blackberry. That’s a rip off. It’s taking the soul of Apple and injecting it into a skeleton. All you will get is a nice ghost story. If you have ever seen or used the Blackberry Apps market, you will know what I mean. There is nothing there. As a developer, I don’t feel motivated to develop apps for Blackberry because its soul is missing.

Lesson – don’t mimic business DNA. It’s unique for each company and should stay that way. Build on your DNA. Don’t transplant it.

4. Following Pied Piper.

The rats that followed Pied Piper made a terrible mistake. They all agreed to be blindly led by someone and died. If you recall your school days, some smart teachers would catch cheaters by figuring out if two students sitting next to each other in the exam had made the same mistake!

How and why did Samsung even bother following Apple? Imagine what would have happened if Apple had followed Nokia?! Following business rivals blindly can be lethal.

Many years ago, when I used to work in my dad’s socks factory, we imported two really expensive sock making machines which we believed would transform our business. Unfortunately, they did not. The machines worked well, but the products they made, failed.

Now, in a mad rush to copy us, our competitors imported the same machine, not just in counts of two or three, but in quantities like twenty-thirty machines! Our competitors not only had product failures (like us); they had business failure too. They shut down.

Lesson – track business competitors and market leaders but don’t blindly follow them. They will either take you to hell or to the courts – neither of which is the beach you were looking forward to retiring to.

5. Saying Sorry is what they forgot to teach you at IIM Ahmedabad.

From the reports I read, many senior executives from Apple met and warned Samsung officials often about their Patent infringements and asked them to change course. Samsung did not care.

If you look carefully around you, the world today has become much more civilized. If someone tries to steal your wife, you will probably have a chat with him (or her) rather than taking out your local pistol and shooting that person. If the culprit says sorry, you will probably move on.

In the digital world that I operate in, we have a wonderful law called ‘cease and desist’. It’s a gentlemanly way of warning each to stop doing something wrong (e.g. copying Bappi Lahiri’s songs and selling them as bathroom music). Once I receive the warning, I stop doing it. Life goes back to status quo.

The challenge is handling the ego and the insult. Most businesses wear armors of pride that cannot be penetrated. And they pay the price of not being able to walk away despite being warned. They get blown to pieces.

Lesson – we all do wrong stuff. But if you get noticed and warned, be smart. Abandon and vamoose.

We can go shopping for our ego some other day.

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Link to the article on The Economic Times

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