Peter talks about competition in the 3rd chapter of the book Zero to One. Before discussing his teachings, I will tell what was my view on competition before reading this.
I was naive and I believed the fact that competition is healthy and is required for businesses to function well. This came from listening to too many consumer side people I think (not consumer centric). Competition creates sanity and keeps the game fair is what I believed till now. Well all this is not false and is actually a fact. But all this is seen and said from the consumer’s perspective, it is good for them, it keeps the game sane for them, not for the business.
From the businesses’ point of view, we have to always maintain an edge over the competition, and this edge is maintained on all the fronts, from pricing to features. This is like cutting your own nerve bit by bit. While this happens for a while, we will reach a point where we will create no profit at all, and there will be money only to sustain the business. This may sound like an equilibrium. But this is bad for you and bad for the tech.
In this condition, all we will think of is survival and today’s problems. This will create an environment which is very reactive and anxious. There will be little to no room for future plans, bigger vision, as there is no bandwidth for anything else than survival.
Although I have a confusion here, whether competition will be fuel to innovation or a water spill on the innovative spark. Because in the contemplation, if there is such a tight competition, we will always be in a race to create differentiating factors that will make us different from the competition and this will push the companies towards innovation.
But then there is on more side of the idea which is, the competition will be so tight that there is no bandwidth, no heeds to innovation. I am not satisfied with this side of the idea. Mainly because, most of the great inventions and innovations happened during war times. The times of serious depression amongst everyone. The pressure and demand of edges over each other was so high that those periods gave a sprint of inventions to the world.
I am guessing that competition might play a similar role in the business world, but I am not entirely sure. This is something that I want to know more of and learn it.
But I will not let competition exist, if I have learnt something from Mukesh bhai, it is, in Emiway’s words – apan khud industry, khud market, khud banayele target, baaki kya tu bahar baith, nazdeek nahi baithneka.