Investor Morgan Housel writes here about features that can, at face value, appear to be competitive advantages at one scale, while being destructive disadvantages at another. On being wiped out (local disadvantage) and being forced to start clean (long term advantage):
The two highest costs many companies face are employee compensation and an attachment to sunk costs. Sunk costs are so entrenched that it often takes a disaster to wipe them away. Part of the reason the German military was so powerful in the early years of World War II is because it had to forfeit every gun, tank, ship, and plane to the Allies after World War I, which meant it rearmed in between wars with brand new, state-of-the-art supplies while other armies used outdated equipment. Having everything taken away from them in 1917 was a counterintuitive competitive advantage.
A practical example of this is when successful new industries can only be run by young people because they’re not burdened with past conceptions of what a product is or how an industry should be managed. Investor Dean Williams once said: “Expertise is great, but it has a bad side effect. It tends to create an inability to accept new ideas.”