- What is an industry leader?
- Can listening to an industry leader hurt your small business?
- When should you ignore the industry leaders?
Q: Should I listen to industry leader advice if I want to grow my small business?
A: Industry leader insights can be very helpful to your small business growth. That being said, industry leaders are human too, and they don’t always know exactly why they were successful. Here’s when you should ignore industry leader advice and adapt your own approach instead.
Here in America, we love a good success story. This is as true in fiction as in industry.
Whether it’s the heroic triumph of an underdog like Rocky or the strategic creativity and intellect of Steve Jobs, people flock to understand success.
Seeing someone else be wildly successful is inspiring, and there’s no doubt that success leaves clues. Hence our infatuation with the industry leader.
Building on this adoration of success, Americans are increasingly economy-focused.
According to Pew Research Center, 71% of Americans believe that strengthening the economy should be the nation’s top priority.
With that in mind, it becomes apparent why so many people turn to industry leaders for advice. It seems obvious that the people who have built the biggest and brightest companies must have the answers to the economy.
But is this really the case? Do industry leaders always have the best insights? And can taking industry leader advice at face value ever backfire for small business owners?
This article digs into these questions, giving you the information you need as a small business owner.
Before we dig in, let’s examine what we mean when we say “industry leader”.
- What is an industry leader?
- Why do small businesses turn to industry leaders for advice?
- Can listening to an industry leader hurt your small business growth?
- When should you ignore industry leaders and adapt your own approach instead?
What is an Industry Leader?
While we frequently speak of industry leaders in the media, the term lacks a definitive definition.
In general, industry leaders can be said to constitute the top 25th percentile of their given industry.
That said, that isn’t a hard and fast rule. In general, the term is meant to engender a sense of innovation and success, both of which are subjective.
Theoretically, an industry leader could be celebrated not because they made the most profit or expanded their company, but because they moved the industry in a positive ethical direction.
Because America is quite economically driven though, industry leaders do tend to be celebrated because of their monetary success.
Notable examples of industry leaders include Jeff Bezos, Elon Musk, and Warren Buffet.
Why Do Small Businesses Turn to Industry Leaders for Advice?
Small business owners frequently look to industry leaders for insights into the market.
On the surface, this makes sense. These people are successful, so if you want to succeed, it’s probably helpful to learn from them.
Industry leaders also tend to have insights that just aren’t practically attainable for smaller companies.
A large corporation has more resources for market research and product development than a small business does.
This gives industry leaders strong predictive power when it comes to market trends. Small businesses can use these predictions to make wise investments, helping them grow into the future.
But just because someone succeeds doesn’t necessarily mean they’re always right.
Do Industry Leaders Always Have the Answers?
While industry leaders do tend to possess strong leadership skills, they’re only human.
There are endless factors that go into an individual’s success. Their intelligence, self-efficacy, and work ethic are all important parts of the equation, but they aren’t the only parts.
Luck and starting resources can also play a role in success. Someone who launches a business with no debt at all can probably play things a bit riskier than someone with a loan.
This means that any given industry leader’s advice might not work the same for your particular circumstances.
Additionally, industry leaders might be a confusing correlation for causation. Clearly, these people are doing something right, but they might not know exactly what.
As an example, imagine an industry leader suggests cold showers are the secret to her success. She says every day she wakes up and jumps immediately into a freezing cold torrent of water.
She says this energizes her and makes her mentally alert so she can make better business decisions. This, she says, is the secret to her success.
What she doesn’t realize is that she’s actually been successful because she’s incredibly hard working. She’s willing to do unpleasant things for greater long-term outcomes, something that helps you stay productive being your own boss.
Her willingness to hop into a cold shower and her success in business are both actually the results of her grit.
They’re correlated, but not causally linked.
That’s the danger of listening to everything industry leaders say. Sometimes you get great business advice. Sometimes you spend a month taking miserable cold showers for no reason.
Can Listening to Industry Leaders Hurt Your Small Business?
While a cold shower isn’t doing any long-term damage, industry leader advice isn’t always so innocent.
When industry leaders talk about investing or market trends, listening to their advice often means investing time or resources.
If their advice is good, this results in small business growth.
If it’s bad, your business takes a loss. As a small business, this loss can seriously set you back.
Depending on how bad the advice is and how diligently you follow it, it may even cost you your business.
When Should You Ignore Industry Leaders?
There’s no hard and fast rule about when you should listen to industry leaders. Each industry is different, as is each leader and piece of advice.
That said, there are a few general guidelines that it makes sense to follow when interpreting industry leader advice.
For starters, consider how closely related your industries are. If you’re trying to go from startup to industry leader yourself, you’ll likely need to hear what industry leaders are saying.
But not all industries are alike. Just because someone is successful in tech doesn’t mean they understand the restaurant business.
Keep this in mind before buying into what a big name says your business needs to do to succeed.
Second, learn about the industry leader’s background. Gaining insight into how they started and where they came from will help you determine what parts of their advice are accurate.
If someone says they made all their money from wise investments, but you find out they got a huge inheritance to fund those investments, it might change the way you interpret their advice.
Lastly, pay close attention to the underlying personality traits an industry leader might have. Often it’s these traits and not a specific routine or strategy that led to their success.
You can aim to cultivate these traits in yourself. Maybe you can learn to be more compassionate with yourself, leading to less negative thinking and helping you keep moving your business forward.
Cultivating positive traits tends to be less financially risky, and even if they don’t help your business, you’ll still be glad you invested your energy.
Industry leaders can definitely provide some valuable insights that can help your small business grow. That said, they can also give terrible or completely inaccurate advice.
- What Is an Industry Leader? (And How To Become One)
- Is Your Company An Industry Leader?
- Agile Doesn’t Work Without Psychological Safety
- Artificial Intelligence Will Have Huge Impact On Small Businesses
The best way to approach industry leaders is with a healthy dose of skepticism. Listen to what they say, but put it into context.
This will give you the insight you need to build your business while allowing you to adapt it to your business’s size and circumstances.