Business Solutions

One important entrepreneurial strategy aims straight at market leadership if not dominance, and is an aggressive strategy right from the very start, planning to have a permanent leadership position, but before an Entrepreneur undertakes this bold strategy they must first realize it is the strategy that represents the greatest gamble, as there is very little room for mistakes, absolutely no room for second chances, and everything has to work out correctly for this strategy to succeed, and it requires significant amount of time for thought, careful analysis and preparation of the business plan. In addition, the strategy demands quite substantial and continuing efforts to retain a leadership position, or all of the Entrepreneur’s hard work simply creates a market for a competitor to take the position as the leader.

Indeed, so many Entrepreneurs over the years have felt like the risk of this strategy is so great that other strategies have been developed, as a result of the notion that the leadership strategy will fail more often than it can possibly succeed, which leads us to another important entrepreneurial strategy that takes what has been developed by somebody else, making improvements that create a better product or service than the original innovative entrepreneurs that first developed the idea.

Basically, this important concept is to let someone else innovate, and then run with their idea, improve on it, and give the consumers of what they really want and most importantly, are willing to pay for. A perfect example of this is IBM creating the PC after Apple created the market with its difficult leadership strategy, and within two years it had taken over from Apple leadership in the personal computer field, becoming the fastest-selling brand and the standard in the market.

The main point to focus on here being that IBM chose a far much less risky entrepreneurial strategy, and succeeded at it, and although Apple Computer has been a great success since, as the original innovator it might have failed to fully understand the scope of its success in the beginning, and what was needed to maintain the strategic position as the market leader.

This type of strategy starts with markets, is both market-focused and market-driven, requires a rapidly growing market, satisfies a demand that already exists rather than having to create one, and is likely to work most effectively in high-tech industries for the very simple reason that high-tech entrepreneurs and innovators are least likely to be market-focused and naturally concentrate on the technology and product.

The strategy of imitation requires a high degree of innovation that can’t be overlooked, as it is not good enough to offer the same product or services at a lower cost, to the consumer who is always looking for greater innovation in addition to competitive pricing.

Openings and associated opportunities in the market are created by habits and mistakes of market leaders, including arrogance of believing that something cannot be any good unless they thought of it first, focusing entirely upon one segment of the market such as the high profit segment, and ignoring the significant volume of the larger market, and the mistake of misunderstanding of quality, which is not what the innovator puts in, but what the consumer is ultimately willing to pay for. A market leader also tends at times to price products and services too high, creating openings for competition, while failing to adapt to different segments of the market.