Do you want to know what Blackwater did better than anyone in the history of the defense industry? Build a brand. Whether you were a lover or a hater, almost everyone had an opinion about Blackwater. In an industry of completely undifferentiated companies, Blackwater was unique in its conspicuousness. Some of this conspicuousness, to be sure, was a direct result of a series of very public setbacks; however, it was the powerful Blackwater brand that made the company such a target for opponents of the Iraq war in the first place. Make no mistake, the Blackwater brand pre-existed (and transcended) the company’s troubles.
Blackwater was not just selling products and services. Blackwater stood for something. It was a direct manifestation of its owner, Erik Prince, and his deeply felt beliefs. Ultimately, Blackwater was selling a culture that a lot of people inside and outside of government wanted to be a part of. And this culture, itself a reflection of the Blackwater Weltanschuung, was threatening to some powerful constituencies. Unfortunately, Blackwater gave these opponents enough ammunition to threaten the company’s very existence and all but destroy the brand.
The question I struggle with daily as the President of a company in the defense industry is whether government bureaucrats can tolerate differentiation – companies that stand out from the crowd. Part of me believes that the bureaucratic mentality finds comfort in an undifferentiated, commoditized marketplace. But part of me believes that everyone, even government bureaucrats, want to connect with products, services, companies, etc. on a more visceral level. Just be warned that the act of connecting with some will alienate you from others. This is certainly a risk that I am prepared to take. I suppose the lesson from Blackwater’s experience is that if you are going to differentiate and challenge the status quo in the defense industry, be sure that your house is in order so the haters don’t have an opportunity to bring you down.
On the question of whether government bureaucrats can tolerate differentiation – companies that stand out from the crowd, agree with your second point that people want to connect with products and services. In our world, the Edgefighter wants to connect with his or her equipment. That connection (in the form of trust) grows over time and becomes what an Edgefighter depends upon to execute the mission. If we do this well, we can stand out (in some ways we already would). It’s what industry leaders do. Related to Blackwater, I wonder if they lost some perspective, which caused them to feel invincible and resulted in their very public problems.