November 23, 2005
How Can David Beat Goliath?- Strategy #7: Attenuate Goliath’s Strengths!
So far, I have had six posts that point out the strategic weaknesses of the large companies and how emerging growth companies can exploit those weaknesses to win in the market. Large companies clearly have some very powerful strategic advantages as well. This post lists those advantages, both real and perceived and follow-up posts will address what the emerging growth company can do to minimize the advantages.
The Large Company Advantages…
There are many perceived advantages that well-run large companies have over the emerging growth company, including the following:
- Great senior managers and employees
- A technology platform in place with customers
- A Patent portfolio and ongoing new patents
- User comfort with the user interface “look and feel”
- Many customer relationships
- Well developed channels of distribution
- A huge set of great technical talent
- A brand name and reputation
- Significant financial resources
- Economies of Scale and Scope
- Ability to bundle multiple products
Attenuating the Large Company Advantages…
There are many very good approaches for emerging growth companies to minimize each of the perceived advantages of large companies. The following few posts will address each of these perceived and real advantages.
Additional note: as I post each of these topics, I will link each of the items above.