[Insight & Opinion] You Don't Need to Be Twice as Good to Achieve Twice the Success

A Slight Edge Creates the Gap
Being Number One Doesn't Mean Being Twice as Good as Number Two
Small Differences Matter in Business, Careers, and Promotions

This is a story about a startup CEO. "To become number one, you have to be twice as good as number two, right? That means my employees and I need to put in twice the effort and energy than we do now, and that worries me."

There are two types of work we do. One is performed based on absolute standards without the need to compete with others, and the other requires competition with others. Many advise not to compare or compete, but unfortunately, entrance exams, sports competitions, and business all fall into the latter category. It is not about how well you perform absolutely; your relative competitiveness against rivals determines whether you become a winner or a loser in the market.

Professor Phil Rosenzweig of the International Institute for Management Development (IMD) conducted a simulation to understand how differences in performance and capability affect the probability of winning. He divided participants into Group A with a 30% putting success rate (30 people) and Group B with a 40% success rate (30 people), then ran a Monte Carlo simulation to see who would win. Group B was about 10 percentage points (approximately 33%) better than Group A, but how much did this affect the difference in winning?

The result was that the probability of a winner emerging from Group A was 4.4%, while from Group B it was 86.5%. This means that if a competitor has about a 33% higher putting success rate than you, your chance of beating them is only about 4 out of 100.

Next, he compared a group with a 30% success rate to one with a 33% success rate. The probability of a winner from the former was 20%, and from the latter was 55.5%. Although the skill difference was only 3 percentage points (about 10%), the chance of winning was nearly three times higher.

This implies that in business, a competitor who is about 10% better than your company can have more than three times the probability of winning contracts or market dominance. A competitor who is about 30% better than you is almost impossible to beat.

Therefore, a twofold difference in market share does not mean a twofold difference in capability. Even a 10% difference in capability can result in more than double the market share.

There is good news in this insight: 1) The competitor who beats you is not overwhelmingly better than you; they may just be slightly better. 2) Just be a little better than others. Then, your competitors may perceive you as an insurmountable barrier.

In products and services, even slight differences in customer satisfaction, quality, and service can create a large gap. The number one company with more than twice the market share of the second-place company does not necessarily have twice the capability.

This applies not only to business but also to personal careers, promotions, and competition. It is not the person who is overwhelmingly better than colleagues who gets promoted. Even a slight edge can create a big difference. When small differences accumulate, the gap becomes difficult to reverse. It is not that an exceptionally good book becomes a bestseller or an exceptionally good song becomes a hit. Usually, it is a slight difference. That slight difference creates the gap.

I once read a book written by a CEO who rose from the bottom to great success, and the title was very inspiring: “Run Just 10 Meters More.”

Shin Sujeong, Head of KT Enterprise Division