Ignoring the Davids could lead to a Goliath's fate

WHAT do Amazon, Tesla, Genentech, Huawei, Alliance Data Systems and Spirit Aero Systems have in common? They are now Fortune 500 companies (or on the fringe), but were hardly noticed when they started out. Companies should be watching out for competition to succeed in the marketplace. Yet, new competitors routinely sneak in and make big strides, before established players take notice or acknowledge their threat. Is this due to neglect or arrogance or both? The characteristics of new competitors are often different. But, do new companies succeed only because of "innovative" products or do older companies yield space due to rigid and archaic service routines? It's interesting to analyse this point as well.

New players are plainly hungrier for business and survival. They are often smaller but nimble (startups). They are also known to have the guerrilla mindset - they employ different tactics than what is common in the industry.

They may focus on one or two opportunities or segments or needs (eg fintechs). They have lower overheads and can adopt an aggressive pricing (or freebie) strategy. They are eager and hence tend to offer high touch and personalised service levels. Startups and small companies spend disproportionate resources on one or two first clients, in order to get entry and use that as marketing leverage. They may "poach" people from more established competitors to ramp up learning and go-to-market speeds. They may also be successful in hiring top talents, by offering startup experience and stakes in the company. They are good attractions among the millennials. Their products may be more advanced as they do not get bogged down with existing designs or tools or legacy technologies. They tend to think in discontinuities rather than incremental shifts. The lean organisation set-up allows them shorter turnarounds for changes to product designs and services. They are often the first to embrace new business models that may impress customers.