One of my key learnings from Walter Isaacson's biography of Elon Musk, is the concept of reasoning from first principles, rather than by analogy.

The concept of reasoning from first principles, is a core tenet of physics and indeed philosophy, which essentially states that we should strip out everything, about which we are not completely certain and then reason upwards from there.

This was the driving force behind the 17th century philosopher Rene Descartes' search for an absolute and irrefutable truth, which he eventually reached, after stripping everything away and being left with the fundamental notion of "I think, therefore I am."

The advantage of reasoning from first principles, rather than by analogy, is that we are forced to start from the beginning and avoid the common trap of improving something, which already exists and mistakenly thinking that we are coming up with a new innovation.

Whilst the Kaizen philosophy of continuous improvement is worthy of deep study and application, it is important to understand that, by definition, improving something that already exists, is not synonymous with original thought and innovation.

True innovations must be born out of original thought, which can only begin, once an existing product or concept has been stripped all the way back to first principles.

This is an exercise in ruthlessly deconstructing things into their component parts, before exploring novel ways of combining those parts together, along with other component parts from separate domains, in order to create something entirely new and original.

Let's consider an example of a Boeing 737 aircraft. 

According to the aircraft's fact sheet, this remarkable flying machine is composed of approximately 600,000 component parts.

No doubt, there are ways to make this plane quicker, more sustainable and efficient by continuously improving it.

By taking the approach of working from first principles however, there will be infinitely more ways of conceptualising entirely new and original ideas.

Whilst it requires far more mental energy to reason from first principles, rather than by analogy, the benefits of doing so, can be enormous.

For example, let's consider the results that Elon Musk was able to achieve when building his first rockets at SpaceX.

When he first set out to build a rocket, it would have cost him approximately $65,000,000 to purchase one. After running some analysis, he quickly calculated that the cost of the rocket's component parts was approximately $1,300,000, which accounted for just 2% of the rockets sale value.

For sake of clarity, the rocket was worth 50x the cost of it's component parts. That is an insane margin.

By reasoning from first principles, Elon was able to apply original thought and innovation to the production of rockets, which has allowed him to disrupt the entire industry.

Hopefully this article has opened your eyes, to the awesome power of reasoning from first principles, rather than by analogy. 

By adopting this approach, you will be able to think in a radically different and truly innovative way. 

As for the competition, you can ignore them entirely. After all, the best way to predict the future, is to create it!