The cult of celebrity is not only present in entertainment, sports, and politics, it’s in business as well. CEOs that get the most attention aren’t necessarily competing better than the rest. In the news doesn’t mean in the know.
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Here’s a true story. A friend of mine, Bruce Hamilton, won the Professional Bowlers Association (PBA) championship some years ago. He laments that his skill is in bowling and not in golf. His prize was nice but the Professional Golf Association (PGA) championship paid seven times as much in that year. Would we say the PGA champ was seven times as skillful as my friend?

In 2013, the PGA champ was paid 28.9 times as much as the PBA champ, up from seven times. Would we say that skill at golfing is growing faster than skill at bowling?

How many top golfers can you name? How many top bowlers? (I can name one.)

We have, in business, a cult of celebrity rather than a cult of strategy. Try this: who’s the CEO of Facebook and who’s the CEO of DuPont?

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Every company wants to grasp the holy grail of competing: to disrupt so thoroughly you make your competition irrelevant. But a disruptive competitive strategy doesn’t last forever. There is a disruptive attitude, though, that might.

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Disruption and the blue ocean are the holy grails of competing. With them, you don’t even have to compete.

Blue ocean is pacific. It’s gentle; it doesn’t bother anyone; it’s just something wonderful and new. Disruption is the bad boy of holy grails. It sees the party going on at your house and lures everyone away to the party at its house.

Disruption is the ultimate buzzword for raising capital. Starting Walmart merely makes you rich. Starting Google makes you rich and cool.

But we are strategists and we demand more than generalities and party metaphors. Is disruption really the holy grail of competing? I’ll conclude that it is, but not of the we-don’t-even-have-to-compete variety. (I’m going to meander a bit on the way.)

In a sense, all extant companies were disruptive at least once because they lured customers to attend the party at their houses. But that’s about as useful as remarking that all extant humans breathe air. “Disruptive” must mean more than breathing. What more it means is a bit unclear.

Walmart is number one on 2014 Fortune 500 list. Its revenues top the combined budgets of California, New York, and Ohio. They top the annual budget of the Netherlands.

Is Walmart disruptive?

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Fair notice: this essay has a trick title.

Mark Zuckerberg, Facebook’s Co-Founder, Chairman, and CEO, recently spent up to $19 billion to buy WhatsApp. You might have heard.

Whether Mr. Zuckerberg overpaid is a subject of frenzied speculation for those who must have an opinion. We do know that no one else thought it was worth more; rather, that no one else with a spare $19 billion thought it was worth more. We know that because Mr. Zuckerberg was 1) willing to pay 2) more than anyone else. Otherwise the media would be all aflutter about what someone else was uniquely willing to pay.

Of course no one knows what WhatsApp is worth. To know what it’s worth implies full know­ledge of the future, including a host of related matters such as the skill Mr. Zuckerberg and his team will bring to bear, how much it’s worth to Facebook to prevent someone else from ac­quiring WhatsApp, what Mr. Zuckerberg could have hit had he aimed his $19 billion else­where, and much more. (In other words, otherwise.) Google, another potential acquirer, had its own calculus.

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In “VCs aren’t [the] only ones able to show you the money” John Shinal, USA Today’s New Tech Economy columnist, reported that US venture-capital (VC) investment in 2012 fell to $29.7 bil­lion from $35.1 billion in 2011. Three years after the financial collapse, VC-backed investments haven’t returned to pre-great-recession levels.

In itself, this is not surprising. Some signs of recovery notwithstanding, little has returned to pre-recession levels in the US economy. The more-troubling news, though, is that the number of acquisitions of VC-backed companies declined by a whopping 21% last year. As Mr. Shinal ob­served, this is the second-lowest total in the past seven years, exceeding the lowest (in 2009) by only six deals. That cannot be attributed to the effects of the financial crisis alone.

Most readers are probably raising their eyebrows right now. Didn’t VC-backed Facebook go public last year in the largest IPO in US history? But Facebook was the exception. The most-dismal news for VCs is that the average internal rate of return for US VC funds over the past ten years strained to reach a dreary 6.1%. In comparison, the Nasdaq rose 10.3% and the Dow Jones, 8.6%. True, a lot of the rise happened in the last three years only as the stock market took off, but one would still expect the masters of the universe to beat stodgy old public corpora­tions!

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