Your Biggesst Competitor

Small business owners are a competitive bunch, and it doesn’t take much to get us riled up over a competitor. If we happen to like the person on a personal level, we might say nice things about them and occasionally even share work with them. If we don’t like a competitor, or if we simply don’t know them, then we tend to think of them as a dark force from the bowels of the earth, out to steal our people, tempt our customers and smear our company’s a good name. Sometimes we even get personal with our competitors by assigning names and faces to them.

We think about the person who took that job away from us after we thought we had it; sometimes after we had already spent the money we planned to make on it. We picture the “big dog” competitor who swaggers their way onto every job site, and into every networking event and convention. You know the one I’m talking about: the loud, larger-than-life person over whom everybody swoons. The one we might secretly envy and want to be more like.

The problem is, companies like these and the folks who run them aren’t our biggest competitors. They’re not even close. Our biggest competitor isn’t market forces, economics, or the changing landscape of how jobs are assigned. Our biggest competitor is so clandestine that we frequently don’t even see them. They’re so sinister that they try to convince us they’re our best friends by flattering us and whispering in our ears about how great we are.

Our biggest competitor is our own ego. The ego tries to convince us that the rules of business and social decorum apply to everyone else but us. The ego keeps us from asking- ing for input that would allow us to make better decisions, or to at least question our assumptions. The ego tempts us to take unnecessary risks and make knee-jerk decisions for all the wrong reasons.

The more successful we become, the more our ego competes with us for continued attention and success. The stakes for winning and losing continue to escalate, and, unfortunately, so does our ego. We’ll never escape it. We can only hope to control it.


For the last 30 years, I’ve had a ringside seat to witness the devastating effects an out-of-control ego can have on a business and its people. And I’m not the only one who’s noticed. In his book, How The Mighty Fall, author Jim Collins outlines five distinct stages that companies encounter as they slip into decline. While Collins writes about billion-dollar enterprises, I’ve witnessed the same principles play out in small businesses. The first stage Collins mentions is “hubris born of success.” In other words, the egos and arrogance of company leaders cause them to believe they’re entitled to success, and that the rules of business no longer apply to them. They mistakenly think they’re insulated from the risk of failure. From my own experience, I can confidently write that when an owner’s ego is out of control, it’s never a matter of if the company will stall or decline. It’s only a matter of when.

If you’re thinking this doesn’t apply to you or you’re wondering- ing how this applies to your business, let’s take a closer look.

Entitlement starts out innocently enough. We launch our business and make good decisions that lead to success. We make some money. We get a title, or we give ourselves one. We start directing people. Before long, our ego pops up and says, “Look at you! They’re calling you the boss. They’re asking you for your opinion. People are even writing about your success.” If we’re not careful, we start listening to these thoughts, and then we start believing them. Before long, we stop asking questions or gathering input from others. “I don’t need to listen to others,” we think. “Just look at my accomplishments, or my title or my money!” Most of us are too polite to say these things out loud, but many of us think them. Or worse yet, we start basing our decisions on them.

Some of us may grudgingly admit that our ego poses a problem for our business, but most of us feel we’re too busy to do anything about it. Seriously? We have time to work on marketing to acquire new customers, look for ways to make more money, or try to find hirable workers, yet we don’t have time to address the biggest threat to our company? Do we not believe it’s a threat? Or do we just not want to address it?


Chris Zook and James Allen write about the impact hubris, ego and arrogance can have on business in their book, The Founder’s Mentality. The results of a survey they conducted showed, “A remarkable 94 percent of barriers [to profitable growth] cited by large-company executives had their roots in internal dysfunction and lack of internal capabilities.” It’s no different with small-business executives. And while all the internal dysfunction in our companies isn’t centered on issues with ego, the roots of dysfunction can be traced to it. When owners and senior managers are encumbered with inflated egos, people stop asking questions; they stop listening. People start hoarding information, erupting in turf wars, expecting entitlements, and jealously guarding their decision rights. Owners resist bringing people into their companies who might have a different perspective or who might challenge the “common thinking,” because sensitive egos don’t do well with this.

How do we get a grip on our ego when our ego has a grip on us? Understand that if we own a business or if we’ve enjoyed some success in our life, we’re in a high-risk category for having an inflated ego. So, we should start by taking an honest look at the person we see in the mirror.

Sometimes it’s also helpful to look at the people with whom we’ve surrounded ourselves. We all need others who ground us, who bring balance to our lives, and who challenge us to be a better version of ourselves. But what roles do these people play? Are they strong enough to challenge us or to have candid conversations with us when needed? Are we grounded enough to listen to them if they do?

What about the key people in our companies? Do they challenge us? If not, why? Do they feel it’s not safe to do so? Or did we intentionally, or unintentionally, surround ourselves with people who are better at saying yes than they are at asking why?

How tough are the questions our people ask us? Are they challenging and maybe even just a little uncomfortable?

We have very little control over our outside competitors, but we do have complete control over our ego.

While this isn’t always what we want, it’s often what we need. Perhaps even more important than the questions they ask are those they don’t.

To parody a popular public-service campaign, “Friends don’t let friends who are blinded by ego drive their business.” Driving a business while intoxicated by ego is a lot like driving a car when drunk. We’re convinced we’re in control, but everyone around us knows better. It’s dangerous to the health of our company and employees.

Another way to surround ourselves with people who will challenge and ground us is to get involved in outside organizations that might put our talents and our ego in perspective — ideally at a board level. This could include civic, church, or industry-related organizations. It’s easy to think we’re the smartest people in the room when that room is no bigger than our own office. But when we get involved with other talented people in an outside organization, we quickly gain the proper insight into our own capabilities and accomplishments.

None of this is to suggest that we shouldn’t have confidence in the decisions we make. We should, and that’s usually a big part of our job. At the same time, we want to make sure our confidence doesn’t grow into arrogance, then into a swollen ego. The decisions we make should be based on data and sound reasoning — not on some indiscriminate need to feed an ego.

When our goals are based on anything other than business sense, we place ourselves at tremendous risk of making wrong decisions. When our “why” is flawed, misguided, weak, or overly influenced by ego, we’ll be tempted to compromise our values or to give up on our goals the first time we encounter adversity, and there will always be adversity in the pursuit of worthy goals.

While I’m sure most of us can think of a few businesses owners who could use a second helping of humility, we should challenge ourselves to look inward instead of outward.

From a competitive standpoint, this is an invaluable point to keep in mind if we’re a younger or smaller company going up against a larger competitor. Knowing that so many large, established companies fall victim to the perils of arrogance, ego, and entrenched thinking can be used to our advantage if we keep our minds and options open. Maybe it’s something as simple as offering custom, out-of-the-box solutions to our customers’ problems rather than saying, “That’s not how we do it here,” as the larger company might.

If we happen to be a larger or well-established company, we would do well to heed any warning signs of ego and internal dysfunction before our company stalls. Over time, it’s easy to drift into a pattern of burning so much energy and emotional bandwidth competing with people within our own organizations that we have little left for competing with outside competitors.


Here’s an effective, five-word acid test to help determine if we’re managing our ego in a healthy way. Practice saying “please,” “thank you” and “I’m sorry.” It may sound simple, but are we comfortable using these words with others in our organization? If we feel hesitant or uncomfortable, that may indicate that we have some work to do on ourselves.

It’s easy to let our ego convince us we had more to do with our success than we actually did. We dismiss the impact that sponsors, mentors, random encounters with others and just blind luck had on our accomplishments. It’s also easy to forget how fortunate we are and what a privilege it is to own a business in a free country.

In many cases, our outside competitors don’t have to be better than we are at what we do. They don’t even have to be good at what they do. They just have to be patient enough to wait until our ego finishes its work and causes our company to stall or collapse.

I’ve always marveled at the loyalty and performance some business leaders get from their people, how profitable some of their companies are, and how often these companies are being led by a leader who can manage their ego. We have very little control over our outside competitors, but we do have complete control over our ego. Maybe this year the biggest competitive decision each of us should make is whether we’re ready to address this internal competitor.

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