Most in the business world talk of first-mover advantage; a company’s capacity to assume better competitive advantages as a result of simply being the first company to introduce a new product within a specific sector or category. First-mover advantage offers temporary monopoly – the blue ocean – since as a pioneer, you are simply alone in that category at the early stage.
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.
Tekedia Mini-MBA edition 14 (June 3 – Sept 2, 2024) begins registrations; get massive discounts with early registration here.
Tekedia AI in Business Masterclass opens registrations here.
Join Tekedia Capital Syndicate and invest in Africa’s finest startups here.
While first-mover advantage is treasured (a clear sign of innovation), becoming a great company requires first-scaler advantage. In our class note in Tekedia Mini-MBA, I provided many cases on how Apple pursues a business model of first-scaler over first-mover advantage.
Before the iPhone, there was Blackberry. Before the iPod, there was the Walkman. Before the Apple Watch, there was Pebble. The list goes on. Largely, Apple does not pioneer many categories but it has an enviable way of coming later through superior product engineering to scale really fast and take over.
In this 2022, do not just be in the habit of looking for new categories to pioneer. Consider if you can massively scale a known promising category!
Yes, Usain Bolt does not usually have great kickoffs, but most times, he is always the guy who takes the medals. He has a great ability to scale-first on speed during the race, outperforming those who started first.
---
Register for Tekedia Mini-MBA (Jun 3 - Sep 2, 2024), and join Prof Ndubuisi Ekekwe and our global faculty; click here.