Based on the positive feedback to Sunday’s post about noise versus signals, I thought I would further explore the value of clear signals.  The operative word in the previous sentence is “clear.”  So much of what we see and hear is often internally inconsistent.  Just ask comedian Steven Wright.

My teacher told me, “Practice makes perfect.”  My mother told me, “Nobody’s perfect.”  So I quit practicing.

What does that have to do with the non-nonsensical, counter-intuitive title of today’s post?  Is there really an upside to cheating?  Is Dr. ESP suggesting cheating is a good thing?  YES and YES.

Cheating is the clearest and most non-transparent signal any individual or organization can transmit.  No one wants to cheat.  Yet it happens.  Not by choice, but by necessity.  During my nine years as a member of the faculty at Miami University, incidents of cheating was the single best indicator of student achievement.  Not because the perpetrator was dishonest.  In the most illuminating sense possible, students self-identified themselves as underachievers.  I did not have to give them a grade, they graded themselves. If they knew the content or adequately prepared, there was no possible reason to cheat.

The true value of cheating comes from the signal received by the person a deceiver hopes to fool.  A few examples from the world of commerce.  Consider the time honored scheme referred to as “bait and switch.”  Based on an offer in a circular or on-line, you go to a store to purchase the “deal.”  When the sales representative suggests you will not be as satisfied with the advertised product versus the higher priced upgrade, what is he or she actually saying?  The fact they carry inferior merchandise?  Or maybe they do not even stock the advertised model?  Even if you participate this time in the “bait and switch” transaction, what are the chances you patronize that store again?  Or is it more likely you will share your experience with friends and family?  As we always tell our students in business classes, the ultimate goal is NOT to make a SALE but to make a CUSTOMER.

The second example demonstrates the value of cheating in commerce at an industry level.  We hear a lot about how the Chinese do not play fair.  They steal intellectual property.  Chinese companies use inferior materials and underpay their labor.  The government manipulates their currency to make products made in China more price competitive and foreign imports more expensive.  Read between the lines and you cannot miss the signals.

If we were as innovative as the United States firms, we would not need to loot their intellectual assets.  If our products were superior, price would not be as important a variable.

The true danger will come when China realizes its investment in industrial espionage and market manipulation is better spent on creating more innovative, higher-value products on its own.  Some of us remember when Japanese cars and Korean electronics were cheap knock-offs of American-based technology.  Today they are worthy international competitors for the right reasons–innovation and product quality.

Dr. ESP, are you suggesting we just let them cheat?  Not quite.  But I do question the allocation of resources.  Let’s return to the above example of the electronics industry.  A plethora of intellectual property (IP) infringement suits have centered on the design and functionality of smartphones.  Samsung sues Apple.  Apple sues Google. Google sues Samsung.  And who benefits?  The legal profession, which instead of chasing ambulances now tails Geek Squad vans.  As Willie Sutton would say, “That’s where the money is.” The more important question is how do these mega-corporations actually hold on to their markets.

Court battles have not crippled Google, Samsung or Apple despite the tens, if not hundreds, of millions of dollars spent on litigation.

• First, they keep innovating.  Let competitors copy the iPhone 9.  By the time their knock-offs hit the market, Apple will release the iPhone 10 with new and better features and functionality.
• Second, deliver what you promise.  Create real value.  Separate yourself from your competitors who can only offer inferior products.  Give the customer what they need and want at a reasonable price.
• Third, create a community customers are proud to be part of and a support system where consumers know you care after the sale.

To prove this point, look at the reviews for anything offered on Amazon.  Consider individuals who bought “Hydro Mousse Liquid Lawn Kit.”  (The product is not worth explaining.)  Seventy-five percent of reviewers gave the product a one-star review with comments such as:

Complete waste of time and money. Was not even close to as advertised.

Wow. I don’t know what they do in the infomercials to make it look like it works but this is absolute garbage.

Comes with this “Mousse” conditioner that’s sealed in the plastic bag filled to the brim. It exploded on me when I opened it up and got green stuff all over my hands face, clothes, driveway etc.

Returned and have not received refund.

I world Not Recommend This to Anybody Not even My Worse Enemy!

Americans know a bad product when they see one, especially when they make a mistake and purchase it one time.  They are fast learners.  They quickly differentiate the perception in a staged infomercial and reality.  They understand “bait and switch.”   And they don’t like being conned.

So, do not waste your time and resources telling people what they already know.  Next time, they will look for a better product.  They want to feel like you really care, not just at the time of the sale, but all the time.  They want to be part of a consumer community they can be proud of.

Are you listening Democratic candidates for president?  (Oops, I think I just created my own “bait and switch” scheme. Sorry!)

For what it’s worth.
Dr. ESP