Beyond First-Mover Advantage to First-Scaler Advantage [video]

Questions from a member in Tekedia Mini-MBA:

In Technology-Market matrix diagram, especially, the rough sea quadrant – where both technology and market are moving fast,
1. should an organization ride on both tides?
2. what is your advice for a start-up in this scenario?

A first-mover advantage can be simply defined as “a firm’s ability to be better off than its competitors as a result of being first to market in a new product category”. The first scaler advantage is the advantage which comes to a firm for being  the first to become extremely popular and ubiquitous by scaling its services in a category.

But note this: the greatest companies in the world are known for one thing: great products. Interestingly, all great products are known by customers. That typically comes because they are well scaled. Extrapolate, you’re talking of  first-scaler advantage, a leverageable compounding competitive advantage which comes with economies of scale as a result of being the first company to achieve scale in that category and improve marginal cost, offering products at highest value and best optimized cost.

If you have a first-mover advantage and fail to scale, you will lose the competitive positioning to another company which comes and scales first. So, first-mover advantage is temporary because sustainable and durable monopoly requires enduring scale in product categories. If you cannot deliver that scale, forget your first-mover advantage.

This is my response. Sorry, I made two videos. Initially thought the first did not record.

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