Can your current strong position be undermined by your competition?

Posted: June 8, 2010 in Readiness & Strategy
Tags: , , , , , , ,

Back in the days of castles and walled cities, the most effective way for a besieging army to destroy the walls was to undermine them. After they had “invested” the castle or city, the attacking army would tunnel from its lines to a weak point under the walls. Once they were pretty sure they had mined to the right point, they would pack an enormous quantity of gun powder and light the fuse, hoping they could get out in time and that the “mine” would blow up the wall, or at least weaken it significantly.

The problem with most successful businesses is that they are like the army in the castle or the walled city. They think they’re secure because the enemy is outside the walls, and that they can play a waiting game. However, they can’t see what is going on underground. But the competition, like a besieging army, is tunnelling to undermine their competitive walls. The market leader, like the army in the castle, doesn’t know where the strike will come from, or exactly when. So he hopes for the best while keeping a lookout for obvious signs of attack.

When you have a commanding market position, the best thing to do is to strengthen it. You need to be on the lookout for competitors who can undermine your own position, and you have to be ready to take them on indirectly yourself. In the old days, defenders would countermine the attacking foe. They would start their own tunnels to interrupt the attacker’s tunnelling and prevent them from setting their explosives under their wall.

Even better, though, is to eschew permanent defenses altogether and to stay constantly on the move. Your competition can’t undermine your competitive advantages if you’re consistently staying one step ahead of them. That’s what we see consistently with Apple. They gained a significant advantage and position with the iPhone in 2007, and they have stayed ahead of the competition ever since then, most recently with the introduction of the iPhone .

After all, it’s much harder to attack a defender when he is always moving and keeping ahead of you.

© 2010 Richard Martin

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