Your Benchmarking Study Is Making You More Average
There is an assumption buried inside most competitive strategy work that nobody questions: if you study the best companies in your industry and do what they do, you will become more competitive.
This assumption is wrong. Or at least, incomplete enough to be dangerous.
Here is what actually happens when an industry benchmarks itself. Company A looks at the market leaders, identifies the practices that correlate with their success, and adopts them. Company B does the same. So does Company C. The result is not competitive advantage. It is competitive convergence. Everyone moves toward the same set of practices. The gap between competitors narrows. Differentiation shrinks.
Benchmarking, done traditionally, is a machine for producing average companies.
The Mechanism
This is not a criticism of benchmarking as a discipline. Understanding what competitors do is table stakes. The problem is what most organizations do with that understanding.
They use it to close gaps. They ask: where do we fall short of the leaders? And they build plans to catch up.
But catching up is not a growth strategy. It is a survival strategy. And survival strategies have a ceiling.
When every player in a market is reading the same industry reports, attending the same conferences, and hiring from the same consultants, they end up with versions of the same strategy. The market moves together. And when the market moves together, the only ways to win are to execute better than everyone else — which is exhausting and temporary — or to find something the entire market has missed.
That second option is the one most companies don't pursue. Because finding it requires a different question.
The Question That Changes Everything
Traditional benchmarking asks: how do we compare to the competition?
Reverse benchmarking asks: where has the entire competition gotten it wrong?
It is a small shift in framing. The implications are significant.
When you ask where the competition falls short, you get a list of gaps to close. When you ask where the entire industry has gotten it wrong, you get something more useful: a map of the assumptions your whole category has been operating under — and a picture of what lives on the other side of those assumptions.
Every mature industry has accumulated blind spots. Not because the companies in it are careless, but because they are all optimizing within the same frame. They have the same customers, read the same trade press, hire from the same talent pool, and compete on the same dimensions. The blind spots are not individual. They are collective. They are built into the industry's shared model of itself.
These collective blind spots are where differentiated growth lives.
What You Are Actually Looking For
The gaps worth finding are not the ones benchmarking reveals. They are the ones it cannot see — because everyone in the industry has normalized them.
They look like this:
A customer segment that exists and has needs, but that every competitor has implicitly decided not to serve.
A friction point in the customer experience that everyone has accepted as unavoidable.
A pricing model that no competitor uses, even though customers in adjacent industries have come to expect it.
A distribution channel nobody has claimed. A step in the customer journey that nobody supports.
These are not small optimizations. They are structural white spaces. And because they are structural — baked into the industry's assumptions rather than any individual company's execution — they are invisible to companies doing traditional benchmarking.
You cannot find them by studying what competitors are doing. You can only find them by studying what competitors are collectively not doing.
Why This Is Hard
Finding structural white space requires stepping outside the industry's frame of reference. It requires looking at your market the way an outsider would — with no stake in the existing order.
That is genuinely difficult for companies that are embedded in their markets. The assumptions are invisible precisely because they are shared. You cannot see them from inside them.
This is also why "looking at adjacent industries" is a phrase that gets said in strategy meetings and rarely produces anything useful. Without a rigorous process for identifying which adjacent practices are genuinely transferable, cross-sector thinking becomes inspiration without application.
The discipline is in the method. Not the idea.
The Practical Implication
Before you commission another competitive benchmarking study, ask a different question.
Not: “how do we compare?” But: “what has every player in this market failed to notice for the last decade — and what would it be worth to the company that notices it first?”
The answer will not come from the benchmarking report. It will come from looking where the benchmarking report was never designed to look.