Is competition good?

In some of the companies where I have worked, I was constantly reminded that the competition would have spies in the form of marketing people. If I went to a trade show or customer site I had to be careful what I said and I should never talk to the press as they would twist take things the wrong way. The last one might actually be true [grin]. It’s almost like living in the 80’s during the cold war. I had a co-op term at Canada’s military headquarters in 1980 and there were posters everywhere inside saying “Careful comrade I’m listening” with a picture of a Russian soldier in a bear skin hat.

Yes we want to stay ahead of our competition but without competition you can effect your own perceived net worth. I worked at a  company in the late 80’s that was so successful that it put all but one of its competitors out of business. The company was public at the time and its stock fell. Most of us were stunned as we figured the stock should be going up. What actually happened was investors felt that the failure of all of our competitors indicated that the market sector was going soft. There was a selling spree and the stock price for both of the remaining companies fell.

A similar thing happened with Microsoft and Apple during the period when Jobs was off founding Next. Microsoft ended up investing in Apple in order to maintain investor confidence. Without Microsoft’s investment we probably would not have iPods, iPhones and all the other “i” things and Microsoft would have suffered as well.

It seems that competition is not only good, it is essential for an emerging market. How do we balance promoting our products, maintaining a market leadership position and communicating with competitors to insure investor support. In the VoIP world the R&D teams seem to have found a solution. Developers meet twice a year with no Marketing or Sales people in attendance. Companies bring their most recent developments and everyone talks and trades information openly. This geek-fest is called SipIt and it moves locations making it possible for smaller companies without large travel budgets, to attend.
The rules are simple “What happens at SipIt stays at SipIt.” and no one is allowed to publish results. If anyone breaks the rules they can no longer attend.

We need to have more co-operation like SipIt’s between companies in the same sector. There are enough customers to go around and there are as many different ways to solve a problem as there are customers. Can you imagine a world where the only cars you could buy were made by Honda and GM? Variety is truly spice of life so lets educate our customers and let them choose.

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One Response to Is competition good?

  1. Hello.This post was really remarkable, especially because I was investigating for thoughts on this topic last Friday.

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