Risky Business

Over at Cooper Interaction Design, Wayne Greenwood wrote a piece called "The high risk of low-risk behavior" in which he argues that, in software, innovation and taking risks is always better than doing things the way others do.

His reasoning generally makes sense, but I disagree with his point about copycats. It is not always the best idea to create features if your competition can easily copy them.

In the 1990’s Duracell started putting disposable testers in battery packages. Eveready responded by placing testers on the batteries themselves. Duracell quickly copied that innovation and included testers on their batteries.

The fact that both companies include this feature has eliminated the competitive advantage it was supposed to have created. Now each company has additional R&D, production, and marketing costs associated with a feature that provides no advantage over the competition. Prices couldn’t be raised; consumers wouldn’t pay more for this feature. So the end result of this innovation was that both Duracell and Eveready saw profit margins fall.

It is always important to consider the reaction of your competition when planning any change in strategy. "Move fast so you will always be first" is a very dangerous way to play the game.