The easiest way to get blindsided by a new competitor? Too much focus.
I’ve said and believed for years that an obsessive focus on a few critical parts of your business was probably the most important discipline that you needed to master in order to succeed.
I was wrong. You can be “too” anything if you’re not careful.
I used to think that you should constantly be mobilizing all the wood behind a single arrowhead, so to speak, to best maximize the force and impact of your activities. This is how you avoid being a mile wide and an inch deep in your business and, essentially, doing a poor job on a lot of different things.
Many years ago, the Japanese figured this out. They knew they couldn’t take on multiple industries, because they were too time- and resource-constrained. They would identify a single industry (the photocopier business, for example) and then deeply attack that marketplace rather than wasting their efforts on several industries and not making a dent anywhere.
Now there are new considerations, principally due to the aggressive and rapid disruptive innovation that threatens every market. Because of the low cost of competing and the ease of market entry; because of the speed of change and its discontinuous rather than evolutionary nature; and because businesses are facing both traditional and non-traditional global competitors, the strategy of bearing down and looking straight ahead risks putting you and your business at a competitive information disadvantage. You literally may not see the competition and the problems coming.
Many of the most serious threats aren’t going to come from the usual suspects. They may come from way down the food chain or from adjacent or seemingly tangential sectors where various technical, legal or geographical barriers previously precluded them.
Traditionally, the typical process of competitive response has been a five-step progression:
1. Ignore 2. Ridicule 3. Attack 4. Copy 5. Steal
Now, if you aren’t on the lookout and don’t see your new competitors coming, they’re likely to roll right over you before you know what happened. We may have a new Man of Steel, but our domestic steel industry was completely destroyed by quick, cheap foreign steel producers who started at the very bottom of the market creating things that no one else even wanted to make, and then quickly moved up to take over the entire business.
You’ve got to pay attention not only to the business you have and the competition that you can see, but you’ve also got to keep a sharp eye out for the guys lurking just over the hill who are getting ready to eat your lunch. Remember, just because you’re paranoid doesn’t mean that someone isn’t out to get you.
HOWARD A. TULLMAN is the General Managing Partner of G2T3V, LLC – Investors in Disruptive Innovators and of Chicago High Tech Investors. He is the former Chairman and CEO of Tribeca Flashpoint Media Arts Academy. Over the last 40 years, he has founded more than a dozen high-tech companies. @tullman