![Jim Clayton: Turning Competitors’ Mistakes Into $1.7B [Outliers]](https://megaphone.imgix.net/podcasts/2a71345e-adb9-11f0-ae83-27d57f0d3d65/image/8982cc611441ae8952644f9fa63796c2.png?ixlib=rails-4.3.1&max-w=3000&max-h=3000&fit=crop&auto=format,compress)
While competitors fired staff and cut advertising during recessions, Clayton Homes adopted the motto, "The country is in a recession and we have elected not to participate." By maintaining investment and playing offense, they captured significant market share and were positioned for recovery.
When caught running an illegal car dealership, Jim Clayton didn't argue. He admitted his ignorance, showed humility, and asked the state examiner to help him become compliant. This transformed a potential adversary into a mentor and resulted in waived fines.
Jim Clayton believed over 80% of legal claims originate from a failure to deliver customer satisfaction. Instead of hiring lawyers to fight, he personally called angry customers or visited homes to fix problems, solving the root cause for a fraction of the cost of litigation.
To challenge managers' insistence on expensive Yellow Pages ads, Jim Clayton installed a dedicated red phone with a number used only in that ad. When the phone never rang, it provided undeniable proof of zero ROI, allowing him to cut the spend based on data, not opinion.
After nearly crashing his plane by abandoning his flight plan on a whim, Jim Clayton learned a critical lesson: in high-stress situations, your senses can be wrong. He applied this to business, relying on data and strategic plans over impulsive emotional reactions during predicaments.
To solve ill-fitting double-wide mobile homes, Clayton Homes innovated its manufacturing. Instead of building two halves separately and hoping they'd align, they built the entire home as a single unit, then sawed it in half for transport, ensuring a perfect reassembly on site.
At age 10, Clayton chose more seeds to sell (reinvesting capital) over an instant toy car prize. This philosophy of deferring gratification for long-term growth defined his entrepreneurial journey, shaping a discipline of plowing profits back into his business.
When a bank forced Clayton Motors into bankruptcy and seized its assets, Jim Clayton formed a new corporation. This new, legally distinct entity then bid at the bank's auction, buying back its own inventory at bargain prices and relaunching the business almost immediately.