Think lobbying’s awful — but smart? Think again. Lobbying’s not just ethically questionable; it’s also strategically self-destructive. For health insurers, banks, and energy producers alike, lobbying is a major strategic error. Consider, for a second, the wages of lobbying across industries. It has destroyed Detroit, rendered telcos impotent, sapped the vitality of agriculture, and caused insurance and real estate alike to implode.
But the most haunting example is pharma itself: by lobbying hard for subsidies and patent enforcement, what strategic outcome did pharma incumbents realize? A deluge of global low-cost hypercompetition, that has left incumbents shocked, stunned, and stumbling.
Why has lobbying backfired on all these moribund industries? Because asking to be insulated from competition saps incentives for innovation — and sharpens incentives for disruption. In health care, for example, lobbying will simply continue to intensify incentives for governments and radical innovators alike to see sluggish, lazy American insurers and producers as ripe for disruption. The tired, lame games of 1.0 strategy merely prevent organizations from learning the lost art of awesomeness. In the 21st century, ethics is the foundation of next-generation strategy.
I really liked this critique of lobbying and the light it sheds on the strategic consequences of government sponsored industry protection.
I very rarely just post a straight reblog of other people’s content, but Umair’s skewering of lobbyists and those who hire them was too tasty to deny syndication.