Being on the front lines has its advantages, gets the blood pumping, and creates legends out of ordinary companies. These companies wake up one day and realize the industry passed them by and then begins the pointing game and the slow death of the organization.Įvery company must decide where it wants to be on the strategic position spectrum. Eventually old customers die off (literally!) and new customers are not attracted due to the lack of sophistication. While the latter may exist, it is generally not long-lived. Laggards are slow to adopt because they lack the sophistication to monitor the competition or because they believe their customers are not interested in innovation. Laggards generally do not implement anything new until it has been broadly adopted by the industry and all of the risks have been clearly identified and resolved.
This group is ultra conservative – and afraid of its shadow. Fast Followers learn from the competition’s mistakes and take advantage of their innovation. The obvious advantage for Fast Followers is the lack of cost associated with being a Leading Edge/Bleeding Edge organization. The key is to be there ready to pounce when the customers come asking, “Hey, when are you going to…?” This same phenomenon occurred with mobile banking, remote deposit capture, online banking, and every other significant innovation in banking.
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And our machine will do all the counting for you!” After the large banks invested millions in marketing and advertising to train consumers on how to use the new ATM machines, along come the smaller, more nimble community banks. “Deposit your checks and cash – no envelope needed. But in reality, sometimes letting the competition build a little market share can help.įor example, several years ago the large banks began to market their new ATM machines that no longer needed a deposit envelope. This approach, of course, requires that the Fast Follower implement a strategy before the leader builds too much of a market share. They live the mantra, “keep your friends close, competitors closer.” Rather than take on all the risk of a Leading Edge company, Fast Followers rely on their nimbleness and choose to adopt a new technology quickly and soon after the hits have been taken and the bugs worked out by the competition. These companies are the Fast Followers.įast Followers monitor their leading edge competitors closely. This poses an interesting dilemma…to innovate or not to innovate.įortunately, companies have the ability to harvest most of the upside without necessarily experiencing the downside. Worst yet, many of those lack the ability to learn from their failures. Mike Maddock, CEO of Innovation Agency Maddock Douglas says to celebrate failure.Īccording to Maddock, “Failure is OK as long as you do it quickly, inexpensively and your whole team learns from it.” The problem: many companies do not know how to fail quickly and cheaply. Jobs and Woz built, failed, rebuilt, failed again, and rebuilt many times before the first Apple Computer was sold. Having said that, innovation is based on failures. They are hiding and pop out when you don’t expect them. They can be production-related, market-related, regulatory-related, etc. Leading edge organizations take on an oversized amount of risk because they are exploring new territory without a map. The problem for many businesses pursuing innovation is their inability to anticipate and manage the challenges that come with being an innovator. Great innovators such as Steve Jobs, Bill Gates, and Mark Zuckerberg have demonstrated to us what can be achieved with cutting edge development. Innovation is definitely the key to staying a step or two ahead of the competition. It is the real life Ground Hog’s Day – where every day we wake up and do it all over again.įor many, the key to competitive advantage is innovation. Seeking a competitive edge is a way of life. Every organization is consistently seeking ways to improve its performance. And while being the market leader is sexy and can bring great rewards and satisfaction, is it the right move for every company? Not necessarily.Ĭompetition is fierce in the business world. We all know where Steve Jobs and Apple Computer rank. Graham Flower, Phil Fawcett, and Stuart Harle, in their book, Banking: In Search of Relevance, define three levels of strategic position: Leading Edge Fast Follower and, Laggard.
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