How Successful Could You Be if You Planned to Fail?
Many technology companies are notorious for being too cautious when introducing new products or bringing to market new technology developed by their skunk works. A new offering will often be underdesigned or feature-limited because product managers fear the new will cannibalize sales of the old. The IBM PCjr is a great case in point – a low-price point PC (for the time) with lots of potential, but one that lacked key features that could have driven it into the SMB and education markets quite nicely. The result is a new product that fails to meet expectations when it isn’t necessary.
But what if a company organized itself in such a way that it fought itself – that it actually planned to fail? Take Apple for instance. What if the company organized itself so that the iPad folks sought to put the MacBook Air folks out of business? And vica versa. Of course, they would rely on the same basic operating system – which would be an operation unto itself with two competing customers – but in every other way the two divisions would slug it out and try to move customers away from one platform and toward the other. No intentional design limitations, no giving one product the faster processor, etc.
Conventional wisdom says that such a strategy is pretty stupid. And it could be if not managed properly. But it might actually elevate competing offerings within the same company to levels that it could not otherwise achieve.
First, there’s an old rule that always applies: if someone is going to cannibalize your market share, make sure you're that someone. For example, if hosted archiving is going to do away with your on-premise archiving solution, make sure it’s your hosted archiving solution that will do it. If your customers are moving to SaaS-based email and away from your on-premise software or appliances, they had better be moving to your SaaS-based email offering. Trying to preserve margins or market share or tradition without being the destination for those leaving you is futile.
Second, competition almost always improves your offerings, regardless of from where that competition arises. If you’re the MacBook Air folks and the iPad folks are gaining market share at your expense, chances are you’ll be motivated enough to at least try to do it better than them. Nations do the same thing by offering lower tax rates or cheaper labor or easier export rules (Ireland is a good case in point.)
Third, acting stupid by announcing to the world that you’re competing with yourself might get good press – and any press is almost always good press. Telling the world that you’re trying to do away with the old and move to the new – while still supporting and improving the old – might just net more market share than you otherwise would have if you hung on too tightly to the old paradigm.