Leadership has both pros and cons. On the pro side, being the leader in your industry means that every possible competitor will have to play catch up with any strategic choices you make. You will be setting the rules for strategic competition, which can lead to very high profits. On the other hand, if you want to be a leader, you have to keep pushing your company outside of its comfort zone. You won’t always know what to do or even what you’re doing, and you will make mistakes along the way. This is the main reason why most companies don’t pursue leadership positions well: it’s scary, and if you do it wrong, bad things can happen.
The good thing about strategic leadership is that most of the things that people think are bad about it aren’t true. This doesn’t mean that being in charge isn’t scary or that things can’t go wrong. Instead, these problems will be there whether you are in charge or not! In other words, whether you are at the top of your industry or at the bottom, you will make mistakes. True, more people will notice the leader’s mistakes, but the sad truth is that companies that are conservative make just as many mistakes, and the market never sees a benefit nor growth from innovation.
So, if we agree that we need to lead our industry, how do we decide what factors can make the largest impact? What really sets incremental innovation apart from innovation that leads an industry? In my opinion, there are three main innovations that if done properly will likely result in you leading your industries:
- Create or innovate a new idea or concept. Often times because these new ideas are unique, they often are too difficult for most competitors to copy.
- Adopt an idea where the cost would be too expensive for most of your competitors to adopt.
- A new idea that most competitors are simply unwilling to try and replicate for any reason.
If your strategic planning has helped you find a strategic competency that works in your industry, it’s likely that some of the new ideas you can try will fit neatly into at least one of these categories. This is because one of the best things about competency-based strategy is that it makes organizations focus on things that are easier for them and harder for competitors. For example, it’s not a secret that Apple is good at end-user experience-based design. This means, strategically, that Apple products may not always be at the cutting edge of what is technically possible, but the experience of using an Apple product will always be better. Why? Because it is easier to use and has been made with the end user and their simplicity in mind. Is it possible for a competitor to make a simple experience for the end user and effectively compete with Apple? Certainly, and in some rare cases, competitors can give Apple a run for their money, but at the end of the day, Apple will win this kind of competition because of the time they have already invested into research and development.
If you want to compete well with Apple, you can do so by focusing your strategy on things that Apple doesn’t do as well, like technical features, open-sourcing, and pricing products like they’re commodities. This combination is exactly why Google’s Android operating system is so good at competing with Apple’s iOS. It’s not that one system is better than the other; rather, Android has strengths that Apple would find hard to match, and vice versa. If you’ve read Simplified Strategic Planning, you know that iOS is the leader in the specialty end of the market, while Android is the leader in the commodity end. Don’t get it wrong: Android will have more users overall, but iOS for Apple in the end will make more money. So, what is your goal? Money or users? Both provide value in their own element, it just depends on the strategic strategy of your company.