TVP – Metric 20 Response Time to Competitors Moves
- Resource Type
- Tool
- Authors
- Alan Fusfeld, Innovation Research Interchange
- Topics
- Innovation Metrics, Stage-Gate, Tools and Techniques
- Associated Event
- Publication
Background | User Guide | Program Contents | Stakeholders | List of Metrics
1. Metric Definition
The ability of the firm to respond to new technical innovations introduced by competitors. Depending upon corporate strategy, it could be the time required to match or exceed the competitive offering.
2. Advantages and Limitations
This metric is an indicator of technical leadership in a given field. The technical leader will not spend a significant amount of time matching competitive innovations, while a follower will be more reactive than proactive. The utilization of resources for this function as a percentage of total resources should be tracked over time. An increase in this percentage would indicate that new technology programs are not as effective as desired and technical position relative to the competition is eroding. This metric also measures the flexibility and creativity of the firm to change priorities to meet competitive challenges. A strong market intelligence function is required to identify competitive entries at an early stage in the introduction and to assess the technical merits of the offering so that appropriate responses can be made. The technical merits of competitive offerings must be critically assessed to differentiate from market repositioning of existing technology.
3. How to use the metric
The time between the introduction of a competitive offering and the internal development of a comparable or superior offering can be measured and compared to product development times for similar products.
A rating system of one to four can be used.
- Organization slow to recognize significant competitive offering in the marketplace; slow to launch program to respond; unable to get their offering into the marketplace in acceptable time to be combatant. Slow to recognize impact of technical innovations.
- Organization recognizes need for competitive offering; has trouble in launching program to develop counter-offering and gets offering to market barely in time to have impact.
- Organization responds to competitive offering and develops counter offering to maintain relative position.
- Organization anticipates potential for competitive offering and has counter offering into the marketplace with superior product allowing a gain in market/competitive position. Very fast to recognize impact of any hints of technical innovations.
The percentage of resources used in matching competitive moves could be measured over time. An increase in spending in this function should raise questions regarding core research and development efforts for organizations who strive for technical leadership
4. Options and Variations
The importance of this metric will depend upon the technology strategy of the firm. Firms pursuing technical leadership will be very interested in minimizing response time. The importance may vary across different strategic segments in the same firm.