Why “They” never can be as good as “Us”: How other organizations must be worse off on essential features

Being different from competitors, in a positive sense, is an important asset to organizations. Well-chosen emphasis on distinctive organizational features is very helpful in achieving a superior position relative to rival organizations. However, organizations often claim to be distinctive on features where they appear be at best only moderately distinctive. Systematic bias seems to arise because what members see as distinctive about their organization is so closely interwoven with how they see its identity. In this study, organization members rated competitors systematically lower on a feature to the extent that they considered that feature to make up the essence of the identity of their own organization. The results point to a serious tendency to underestimate comparable competitors as a consequence of the social comparison heuristics. Managerially, this implies an important caution when designing corporate strategy and positioning.