First Mover Advantage : The Gospel Truth?

A first mover is a service or product that gains a competitive advantage by being the first to market with a product or service. Being first typically enables a company to establish strong brand recognition and customer loyalty before competitors enter the arena.

Some management concepts have such intuitive appeal that their validity is almost taken for granted. First Mover Advantage is one such concept. While FMA is one of the most appealing and diffused concepts in strategy, there is still no conclusive evidence either in favour or against it. A lot depends upon the positive relationship between the age of the firm and the sub-markets it operates in, as much as also the negative correlation between such statistics and the probability of exit. I consider factors favouring the emergence and protection of the advantage lie with the leadership, preemption of assets and switching costs for consumers, thus collectively constituting the entry barrier.

There are examples of where the first-mover advantage paid off. Amazon’s head start in e-commerce turned into hundreds of millions of customers, with a substantial number of them paying an annual subscription just to get free shipping. More often than not, however, the company that beats everyone to the punch doesn’t end up the long-term champion. While being a trailblazer might turn you into an icon, most early entrants end up being also-rans when the dust settles.

There are some benefits to being the first to move:

• Capture customers that can’t fathom the switching costs once competition arrives
• Patents, if any, can protect you and your incumbent technology, methods, and ideas from getting  copied or duplicated by the competitors 
• Branding is easier when you don’t have to differentiate yourself from a similar offering
• Wherever applicable, in case of limited amount or source of resources, a first mover can snatch them up before others come to the party

Meanwhile, being the first business in an industry may not always guarantee an advantage- 

• Later entrants would benefit from the informed buyers and would not need to spend as much on educating consumers
• Later entrants can avoid mistakes made by the first mover
• If the first mover is unable to capture consumers with their products, later entrants can take advantage of this
• Later entrants can reverse-engineer new products and make them better or cheaper
• Later entrants can identify areas of improvement left by the first mover and take advantage of them

New products and categories are constantly emerging around us. In most cases, companies and teams struggle not with whether to enter with a new product category or line of solution altogether but with whether to enter now or later. Practically, first-mover advantage occurs not when you enter a market, but when you start making real dividends out of it, like you say in chess it is not about whether you are blacking white or black, it is about when you start making inroads and "move into an advantageous position".

To make real money in an evolving market, we need to continue to innovate, evolve and analyze the kind of environment that surrounds the new category; to assess the character and depth of our resources, technological as well as economical; and then decide on the type of mover we want to be, whether to play white, play black or go-with the flow and play along when others jump into the pool. Remember, once you have taken the jump or plunge into the water, whether or not you drown or survive, you have one chance and option, to at least swim with or against the waves.

Impact of Geopolitical Crisis

War has immediate consequences for global trade, capital flows, financial markets and access to technology. International sanctions usually have long-term consequences and new elements introduced into new(er) normal.

The ongoing conflict between Russia and Ukraine may impact certain high-frequency indicators like financial markets, exchange rate and crude prices in the short-term for India. However, it noted that this moment will not have any lasting impact on  the Indian economy. While with the ongoing geopolitical crisis in the northern regions of the globe, the banking sector of the country being resilient and trades insignificantly alarming, the GDP is also expected to have a negligible impact due the conflict, but India is indeed torn in between for the defence imports from Russia and the US. Meanwhile, further sanctions by the West on Russia for payments, can force India to revert to erstwhile INR/RUB exchange for whatever minimal trade.

Looking farther ahead, the decisions of oligopolies like Visa, MasterCard, Google, Apple, PayPal etc to suspend their services as part of sanctions issued in particular geographies, draws attention to the preparedness of the individual economies and financial systems of the countries or regions to deal with such denial of services. India is no stranger to sanctions or denial of services, but still in spite of the major efforts made to shield the economy from the whims and fancies of the stronger economies, we are still not completely insulated or independent as our immediate northern neighbours. In the payment world, India has built substantial capability since the launch of the RuPay and UPI infrastructures under NPCI, which at present process far more transactions in India than the multinational payments technology companies. The only speed-breaker in the overall autonomy is the segment of international transactions for credit cards, which is governed and ruled by the Visa-MasterCard duopoly.

The icing on the cake is the spurt of new age first generation entrepreneurs and disruptive startups in the fintech space which provides the impetus and cushion for financial independence and stability of the financial system. 

Farm Laws

Agriculture with its combined sector is the largest source of income in India. Agriculture is an intricate issue that raises important questions not just for India but for all economies struggling to strike a balance between the market and the state. 

The three controversial laws have been drawing flak since the beginning which led to protests and agitations. The major representation of farmers had been demanding its' repealing as they perceive them to be pro-corporations and to be very anti-farmers. Meanwhile, the electricity (amendment) bill, 2020, have also been opposed by the farmers' community as they term it to be nothing but a bait set by the government so that big corporation will have more profit.

While there have been lot of debate, criticisms, discussions, clarifications, explanations, political tug-of-war, and coherence around the laws, the experts are of the opinion that it is not a union subject but a state subject and it is up to those to decide what will be best suited for their farmers’ income. Both state and union have the power to control the production, distribution, and products of the industry including agriculture. 

Agriculture plays an important role in our country to become “atma-nirbhar” and for that to happen it is important to strengthen the agrarian sector. The laws are facing criticism due to the loopholes around MSP, APMC, indirect tax/revenue management, as those loopholes can bring nothing but "corporate-nirbhar" India but if we can reform them in a way that those loopholes will repeal then these laws can bring a good change in the society.

Freelance Portfolio Professional

A portfolio professional is the new generation of entrepreneur;  someone who mixes and matches several jobs or sources of income. potential clients, problems or opportunities, drawbacks and advantage of the opportunities available, value proposition with your product or service, and very importantly points or reasons for frustration.

Think about who you will be selling your services/products to and who they are. Are there multiple groups or types of individuals? Who would you love to have as your potential clients? What characteristics define them? You want to have an intimate understanding of your clients and their problems or opportunities. What are they thinking about now? What possibility would be exciting to them? 

You want to have an intimate understanding of your clients and their problems or opportunities. What are they thinking about now? What possibility would be exciting to them? Do they value speed, quality, price or customer service? What values do your clients hold for themselves, e.g. efficiency, career, professionalism, an appreciation of great design? On the other hand, what would rub them up the wrong way? What frustrates them? How do they find and buy support?

Smart Farming

Smart Farming is a farming management concept using modern technology to increase the quantity and quality of agricultural produce. The farmers in this century have access to modern-day technologies like GPS, soil monitoring, and IoT technologies. On similar principle, using Smart Farming techniques, farmers can better monitor the needs of the livestock and manage their nutrition.

An information and technology-based farm management system identifies, analyses and manages variability in fields by conducting crop production practices at the right place and time and in the right way, for optimum profitability, sustainability and protection of the land resource, but in India, one major problem is that more half of operational holdings in the country have size less than 1 Ha (hectare), except Punjab, Rajasthan, Haryana and Gujarat where more than 20% of the agricultural lands have an operational holding size of more than 4 Ha.

The recent innovation technologies based on sustainable agriculture and healthy food production consists of profitability and increasing production, economic efficiency and the reduction of side effects on the environment.

Researches suggest educational and economic challenges are most important in the application of these practices. The variables that contribute to educational challenges, lack of local experts, funds, knowledgeable research and extension personnel have more of an impact compared to others.