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Will & Vision: How Latecomers Grow to Dominate Markets

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Few business principles engender as much faith among people as the principle of the pioneer's advantage. For example, Ries and Trout, in their book on the 22 Immutable Laws of Marketing, boldly state the "first immutable law of marketing" to be "It's better to be first, than it is to be better." Brand recognition, brand loyalty, consumer inertia, network effects, experience effects, access to distribution channels - these are all reasons for why the first movers in a market could have an advantage over others in the quest for market domination. Consultants, academics, and managers note the many examples of pioneers who appear to have done very well in their markets. Look, they say, at Gillette (in safety razors), Hewlett-Packard (laser printers), Microsoft (PC operating systems), and Amazon.com (online bookselling). All of these cases appear to prove the pioneer's advantage.

Tellis and Golder argue quite convincingly that these examples prove exactly the opposite: pioneers are much more likely to be cursed to failure than blessed with long term success! The authors show that the real pioneers in the markets listed above are not the current market leaders. Gillette entered the safety razor market in 1903, but a company called Star, they find, had already introduced a safety razor in 1876. H-P entered the laser printer market in 1984, but IBM had one on the market in 1975. Microsoft introduced MS-DOS in 1981, but Digital Research had introduced its CP/M operating system back in 1975. Amazon.com entered the online bookselling business in 1995, but Clbooks.com/books.com was selling books online in 1993. Most of these pioneers are forgotten now - many are long dead. Yet the myth of the pioneer's advantage lives on.

Using new and detailed historical research, Tellis and Golder systematically debunk the myth of the pioneer's advantage. The book refutes much conventional wisdom, and wonderfully weaves together hard data and vivid business stories to argue its thesis. Tellis and Golder are two of the world's leading experts on market entry and long term success. Their prior research has had a major impact on the academic business community. Yet if current and recent business practice is any indicator, few managers seem to be aware of the lessons that emerge from this remarkable stream of research. One only needs to think back at the Internet gold-rush to see this point.

The bulk of the book is on the question: If pioneering does not explain market dominance, then what does? Again, Tellis and Golder bring fresh, unorthodox insights to this question. They organize the answer to this question along two dimensions: Vision and Will. Their arguments force one to rethink several common precepts. For example, they challenge the very notion "vision" as it's currently understood. Similarly, they point out that dominance is often seen as a function of luck, or being at the right place at the right time. In fact dominance is more a function of small, incremental innovations in design, manufacturing, and marketing over many years. Indeed, it took Procter and Gamble (a latecomer) 10 years of persistent planning and research to find success in the lowly disposable diaper market.

Overall, the book is provocative and compelling, meticulously researched and highly practical. The case studies alone are worth the price of the book. But the novelty and persuasiveness of the insights make it one of the finest works on business strategy.

This book comes out with a hypothesis challenging conventional thinking which assumes that pioneers dominate markets. Collecting and analyzing historical data from over 66 industry segments the conclusions by the authors is baffling. This is not a case where statistics is used conveniently to support untested theories using available tools to prove a point. The approach to understanding market dominance and the role of pioneers and followers is path breaking. Contrary to common belief, data shows that in many cases the pioneers have as little as 9 % market share. The ingredients for success are therefore not being there first, but doing the right things.

Five factors that emerge as key to ensuring long term success and market dominance are Vision, Persistence, Financial Commitment, Innovation and Asset leverage- factors that are structurally related in a causal chain starting with a clear vision for a mass market. There are innumerable examples and detailed cases where the inability to see a mass market for innovative products has resulted in late comers grabbing the market from incumbents. Fear of cannibalization of existing products, bureaucracy, complacency, are some other causes that stifle growth.

After explaining the hypothesis, a good and crisp summary of the conclusions from the historical data, every chapter proceeds sequentially to substantiate the findings. This is a rare combination of business history, statistical analysis and strategy. It is this unique combination and the unconventional wisdom that is bound to make this book a classic in its own right. The range of products covered varies from diapers to couriers and computers. IBM, Microsoft, Fed Ex, Xerox, Gillette are some companies that are discussed in detail.

Comparing it with other books on similar research, my prescription for business would be:

Innovators Dilemma + Will and Vision + Built to Last + Good to Great = Road to Market dominance.

Highly recommended.

The best thing about this book is that it is written with an impeccable style that makes it easy and fascinating to read. In fact, if you are interested in innovation, pioneeering and market leadership, this book is UN-PUT-DOWN-ABLE! The amount of research that must have gone into compiling insightful commentaries on leading organizations in different industries amazed me, and interesting conclusions drawn from these observations kept me reading on till the very end.

I am currently doing research in these areas and find this book full of new ideas that stimulate rethinking of traditional truisms on innovation prediction and management. I highly recommend this book!

Marketing professors Tellis (at USC's Marshall School) and Golder (at NYU's Stern) have written a stunning masterpiece on the management of innovations. In their book, they present the findings of their decade-long research on success and failure of new products. They submit the mainstream myth "first movers grow to dominate markets" to rigorous empirical testing. They convincingly show that this common myth is wrong and that in contrast especially early followers with strong will and vision dominate today's markets. One of the main strengths of this book is the rich detail in histories of leading companies such as Microsoft, Intel and Federal Express, which Tellis and Golder use to argue their case. The combination of this rich historical detail with strong theoretical logic makes this book into a must for anyone interested in managing innovation. In this sense, it truly belongs among the classics in this domain such as Utterback and Foster. Managers in innovation management should definitely add this book to their personal libraries. Professors will also find the book to be a useful tool for executive education.

Based on their research on success and failure of new products, Tellis and Golder have composed a true masterpiece on managing innovation. Against the mainstream thought, they challenge the common belief that pioneers necessarily dominate markets. In contrast with this common belief, they advance that especially early followers that have strong will and vision are most successful. They do so in a style, which is easy to read and captivating. Especially the historical business stories on successful companies such as Microsoft, Intel, and Federal Express, are intruiging and offer valuable lessons in innovation management.

This book is a must-read for any executive involved in innovation management!! It is also a valuable tool for professors involved in executive and MBA education on innovation and technology management.

This book is about the common ingredients of market leaders--companies that dominate the market in terms of market share. Unlike common belief, the first comer does not become a market leader in the long term. Only the companies have the vision for mass market, will to edure hardships, innovation, asset leverage, and financial commitment can be the market leader.

A must lead if you are a business owner because it can show you what is neccessary and what it takes to become a market leader.

Also, try "Only the paranoid survive" by Intel CEO Andy Grove. It is about innovation and try to be one step ahead of competitors. Nice complementary book to this book.

Outstanding! Very serious research, one of the best about business success. Should be included in every business curriculum.

Marketing professors Tellis (at USC's Marshall School) and Golder (at NYU's Stern) have written a stunning masterpiece on the management of innovations. In their book, they present the findings of their decade-long research on success and failure of new products. They submit the mainstream myth "first movers grow to dominate markets" to rigorous empirical testing. They convincingly show that this common myth is wrong and that in contrast especially early followers with strong will and vision dominate today's markets. One of the main strengths of this book is the rich detail in histories of leading companies such as Microsoft, Intel and Federal Express, which Golder and Tellis use to argue their case. The combination of this rich historical detail with strong theoretical logic makes this book into a must for anyone interested in managing innovation. In this sense, it truly belongs among the classics in this domain such as Utterback and Foster. Managers in innovation management should definitely add this book to their personal libraries. Professors will also find the book to be a useful tool for executive education.

In Will and Vision, the authors refute the theory that first-movers have an overwhelming advantage, and replace it with the idea that seven factors, that can be summarized as will and vision (hence the title of the book) are instead the factors that permit companies to dominate markets.

First, the author performed an in depth empirical study that included 43 different industries at different times in order to show that the original entrants in many markets were not in fact the current leaders. Instead, the authors offer the following seven factors as the main ones in determining whether firms became leaders in their markets:

* Envisioning the Mass Market - Examples include P&G with Pampers disposable diapers for everyone instead of for travelers only and Kodak with photographs for the non-professional.
* Uniqueness of Vision - Examples include Tim Berners-Lee and the development of the WorldWideWeb and King Gillette's view of the razor market.
* Persisting Against All Odds - Examples include Bill Gates' persistence that landed him the operating system contract with IBM and Haloid's persistence over a decade that created Xerox.
* The Need for Relentless Innovation - Examples include Moore and Noyce leaving Fairchild Semiconductor to found Intel and the relentless pace of innovation there, and Gillette's close brush for lack of innovation in the 1960s and its ensuing fast pace since.
* Organizing for Innovation - Examples include HP's organization beating Xerox and IBM at the laser printer market, and Netscape beating Mosaic by taking talent and rewarding it.
* Raising and Committing Financial Resources - Examples include Fred Smith's almost bankruptcy to keep FedEx alive and Amazon sacrificing profits for a long period in order to achieve its envisioned mass market level of service.
* Leveraging Assets Despite Uncertainty - Examples include IBM losing the PC battle because it did not want to hurt its mainframe sales, and Charles Schwab's leadership in web trading after it chose to focus on it and sacrifice off line higher margins.

Overall, I found it a very good entertaining book, with anecdotes that help support the ideas the authors suggest. I strongly recommend it.

Loved this book. It's inspiring and it brought me several insights while I was reading it.