Market Dynamics

By Vijay Govindarajan

It’s a jungle out there.

While this simple phrase has been used time and time again to discuss the many obstacles people and companies face, an animal metaphor does describe required innovation actions rather effectively.

Imagine a 2×2 matrix with size on the y-axis and speed on the x-axis. Size can be represented as market share, revenue or units sold, depending on the context. Speed is the speed of innovation of a company relative to the industry. When a company, product or service is ahead of the competition, speed is high. When it is lagging behind the competition, speed is low.

But why is relative speed so important? Consider a story where two hunters encounter alion with no ammunition left in their guns. When one starts to run, the other claims the lion will eat him either way. The first replies, “Not as long as I can run faster than you!”

Just like in the jungle, if you are not faster than the competition, you can get eaten up. The key question is, “What actions can be taken to get ahead of the pack?”…

So, clearly, every organisation must have some seeds of breakthrough innovation and must cultivate its patch in order to ensure a good harvest tomorrow.

However, some organisations have a stronger sense of urgency than others, a bigger need to pick up the pace, and the need to move faster. This jungle framework helps put this in perspective.

(From “Finding Your Place in the Competitive Jungle”)