Sunday, June 15, 2008

Know your business

Via Instapundit we have this timeline of Wikipedia vs. the AP.

The problem for the AP is that they (should have) a lower tollerance for getting it wrong. I'll leave it to them to address their specific business problem, but the general lesson is to know your business, and not try to compete on the other guy's terms. Wikipedia has the luxury of a reputation which forgives inaccuracy under the premise that it is easily corrected. AP lacks that advantage, so instead of competing on speed, it needs to compete on its strength.

Many companies are afraid of this kind of competition, because it creates what is called differentiation, and when you are different, you risk losing business even if you execute flawlessly, because the market demanded what made the competition different from you, instead of the other way around. It is much easier to play it safe, especially with a boss, or a board, that will have no problem just retroactively deciding that being different was a bad decision. Playing it safe means being just like the other guy, just doing it better, or being able to hide behind the excuse that any failure wasn't do to execution of the concept, because you see your product competes feature for feature.

It is those that are in a position to take that chance, that can become the next Google.

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