Reject Industry Standards--Set Your Own High Bar

This conversation with Austin Litzey, a principal at Acquisition.com, fundamentally challenges the pervasive reliance on "industry standards" as a benchmark for success. Litzey argues that adhering to averages, rather than setting one's own high bar, guarantees mediocrity and limits potential. The hidden consequence of accepting industry norms is a self-imposed ceiling on growth and innovation, leading to businesses that merely tread water instead of achieving exceptional results. This analysis is crucial for entrepreneurs, business leaders, and anyone striving for excellence, offering a framework to identify and dismantle the mental handicaps that prevent them from achieving extraordinary outcomes. By understanding the systemic forces that pull towards typicality, readers gain the insight to intentionally cultivate distinctiveness and build lasting competitive advantages.

The Unnatural Act of Profit and the Tyranny of the Average

The most striking revelation from Austin Litzey's perspective is the idea that "profit is unnatural." This isn't to say profit is impossible or rare, but rather that the default human and organizational tendency is to spend, to revert to equilibrium, and to accept what is "good enough." Litzey illustrates this with a story about a $500 million company where a leader repeatedly defended subpar acquisition metrics by stating they met "industry standards." Litzey's sharp retort--"Do you wake up in the morning and just say, 'I want to be an average company?'"--cuts to the core of the problem. The pursuit of being average is, in itself, a choice that guarantees a company will be outperformed by half its peers.

This acceptance of mediocrity creates a powerful feedback loop. When a company's goal is merely to meet industry averages, it actively cultivates a culture where "good enough" is the ceiling. This mindset permeates every aspect of the business, from sales targets to profit margins, and even personal choices like health and relationships. The consequence of this low standard is a business that is perpetually vulnerable, unable to weather storms or seize opportunities that demand exceptional performance. Litzey emphasizes that the entrepreneur's most critical role is often to be the "standard setter," holding the line against the pervasive pull towards normalcy.

"I don't know about you, but I didn't get in the game, whatever game you're playing, to be average. The average business is average. The average American is overweight, they're in debt, they're divorced, they're depressed. The average business makes almost no money. Why would I use industry standards, industry averages, anything like that at all?"

-- Austin Litzey

This is where the concept of "profit is unnatural" truly lands. To achieve outsized results, one must actively fight against the natural tendency to spend, to relax standards, and to settle. Litzey recounts a situation where a leader proposed hiring 15 sales reps over three months to meet Q1 goals, a plan that would generate an additional $4 million in profit that quarter. Litzey pushed back, asking why it couldn't be done in one month. The leader's initial reasons--cultural strain, stretching the team--were valid concerns, but ultimately they represented a lower standard. The leader eventually devised a plan to onboard the reps in one month by leveraging senior staff, unlocking that $4 million profit sooner. This demonstrates how a higher standard, a refusal to accept the slower, "normal" timeline, directly translates into greater financial success. The system, left to its own devices, would have yielded less. It required an intentional, higher standard to capture the full potential.

The Illusion of Effortful Solutions and the Power of Multiple Attack Vectors

A significant downstream effect of accepting industry standards is the tendency to settle for single, often obvious, solutions to problems. Litzey argues that true progress, and the competitive advantage it brings, comes from attacking problems with multiple vectors. This means not just trying one or two things and giving up, but relentlessly exploring different angles until a solution is found. The implication is that many businesses fail not because their problems are unique or unsolvable, but because they lack the skill or the standard to pursue solutions exhaustively.

Consider the challenge of hiring sales reps. The "industry standard" or "reasonable" approach might be to hire a few each month, managing the process carefully. This is a single-vector approach: hire more people. However, Litzey advocates for a multi-vector strategy: "Can we hire five recruiters to speed up the process? Can we fly all of the SDRs in person to get them trained up faster so we don't lose cultural issues and we can get them on-ramped in three days rather than in 30 days? The top two most experienced guys who have some blank space, have them sub in." Each of these is a different way to solve the hiring bottleneck, a different "attack vector." The cost of these additional efforts might be higher in the short term, but the payoff--achieving the goal faster and unlocking significant profit--far outweighs the expense.

"You're going to tell me that no one on Earth has ever had the same problem that you have right now, and of those many people on Earth who have had it, no one solved it? You have somehow come across the Gordian knot of problems."

-- Austin Litzey

The conventional wisdom here is that efficiency means doing one thing well. Litzey's analysis suggests that true efficiency, especially when aiming for exceptional outcomes, involves a more complex, multi-pronged approach. The downstream effect of a single-vector strategy is stagnation. The system adapts to the one solution, and progress halts. In contrast, a multi-vector approach forces the system to adapt continuously, creating a dynamic that is harder for competitors to replicate. This is where delayed payoffs create a significant competitive advantage. While others are content with incremental progress from a single approach, the company employing multiple attack vectors is rapidly iterating and finding breakthroughs, often at a pace that leaves competitors bewildered.

Differentiation as Survival: The High Cost of Being Typical

The final, and perhaps most profound, insight is framed through Jeff Bezos's final letter as CEO of Amazon, which Litzey uses to underscore the concept of "differentiation is survival." The universe, Litzey explains, actively pulls entities toward equilibrium, towards being typical. Maintaining distinctiveness--whether for an individual, a company, or even a marriage--requires constant, deliberate effort. This is the "work" that staves off the natural tendency to merge with the surroundings.

For businesses, this means rejecting industry standards not just as a strategy for growth, but as a matter of survival. Using industry averages as a benchmark is akin to a living organism failing to maintain its internal temperature in a cold climate; it's a slow death by equilibrium. Litzey argues that competitors who adhere to these standards are operating with a handicap that you can exploit. Their "normal" is your opportunity. The difficulty lies in the fact that maintaining distinctiveness is energetically expensive. It requires continuous effort, often in the face of resistance and skepticism.

"The world wants you to be typical in a thousand ways. It pulls at you. Don't let it happen. You have to pay a price for your distinctiveness, and it's worth it."

-- Jeff Bezos (as quoted by Austin Litzey)

The consequence of choosing to be typical is that a business will eventually become indistinguishable and vulnerable. Conversely, the consequence of embracing a higher, self-defined standard and actively pursuing differentiation is the creation of a durable moat. This often involves making decisions that are unpopular or seem unreasonable in the short term. For example, setting a goal to break a world record for book sales, as Litzey did, invites skepticism. The "reasonable" response would be to accept conventional wisdom about book launches. However, Litzey's approach was to ask, "What physical law of reality prevents us from selling this many books?" This led to meticulous planning and redundancy--backup generators, internet backups, massive printing and logistics--all designed to ensure the goal could be met regardless of external disruptions. This relentless pursuit of an "unreasonable" goal, backed by an understanding of the underlying mechanics, is precisely what creates extraordinary outcomes and a distinct competitive advantage that others cannot easily replicate because they are not willing to bear the cost or the effort.

Key Action Items:

• Reject "Industry Standard" as a Goal: Consciously identify and discard any metrics or practices that are based on industry averages. Define your own superior standards. (Immediate)
• Define Your "Unreasonable" Goal: Set ambitious targets that push beyond conventional limits, then rigorously analyze the physical and logistical constraints preventing you from achieving them. (Immediate)
• Map Multiple Attack Vectors for Key Problems: For any significant bottleneck or challenge, brainstorm at least five distinct methods of solving it, rather than relying on a single approach. (Over the next quarter)
• Prioritize Profit as an "Unnatural" State: Implement systems and disciplines that actively combat the tendency to spend profits as they are generated. Focus on increasing revenue without a proportional increase in costs. (Ongoing)
• Invest in Speed and Efficiency Beyond Norms: Challenge timelines for critical processes (e.g., hiring, product development, customer onboarding). Identify and implement strategies to accelerate these processes significantly, even if it requires upfront investment or unconventional methods. (This pays off in 6-12 months)
• Cultivate a "Standard Setter" Mentality: Ensure that the leaders of each department or division are individuals with the highest personal standards, capable of holding the line against mediocrity. (This pays off in 12-18 months)
• Embrace the "Price of Distinctiveness": Recognize that maintaining a unique position in the market or in your field requires continuous effort and investment. Be prepared to pay this price, as it is essential for long-term survival and success. (Ongoing)