Imitating competitors

The supply chain features, as we noted in Chapters 1 and 2, are part of what we have called the "extended" product. Competitor imitation or lapses of patents eventually enable competitors to imitate the physical features of the product itself. Extended product and supply chain features, in turn, often become the principal basis for competing. 

Indirect effects are also very likely, because if the U.S. employed technology to reduce C02 emissions, then the resulting cost reductions would provide a competitive advantage for a while and would then be imitated by foreign competitors. This could energize global emission reductions. One path would be to develop crop strains that could take advantage of C02. 

Barriers to Imitation How is the idea protected from imitation by competitors Is it protected by intellectual property law through patent, copyright, or trademark If not, is it difficult to imitate by its nature How so Is it difficult to reverse engineer Is it protected as a trade secret Are there unique, exclusive sources of components or other supplies Are unique labor inputs required to develop, maintain, support, and extend the product or service ... 

Companies should not imitate the promotion of competitors in a way that is likely to mislead or confuse, e.g. by using devices, copy, slogans or general layout that has been adopted by other companies and is likely to be associated with that company. 

In the summer the product that survives is gaining acceptance in the marketplace. Being the first in the market means a good margin of profit, but it also means that the company is even more cash-hungry than in the spring. The rapid expansion of sales requires even more capital to design and build new plants and to penetrate new markets. The sweet smell of success also draws many imitators and competitors, who try to enter the market despite the presence of any previous, cautiously laid out barriers to entry. Research on product improvements... 

The rationale for patent protection is based on the need for providing a return on the R D necessary to bring an innovation to the market (366). In the absence of patent protection (or some other form of protection from imitation), competitors would copy the innovation at a fraction of the cost to the innovator and sell the product at prices that arc insufficient to recover the initial R D investment. Thus, incentives to invest in innovation would be compromised (242). 

It is fit that provides sustainable competitive advantage, according to Porter. Competitors can usually imitate the individual activities of successful companies but they ignore the impact of second and third order fit — the greatest contributors to competitive position. To dislodge their successful adversary, they must copy not one, but several activities and link them effectively. This is many times more difficult than imitating a single activity. 

If, in the following, I speak of models" or "exemplars" and of "copies" and "imitators", I will not use these terms as if there were master plans for successful development, and that in simply following them, anybody else would become equally successful. Rather the perception of success by competitors led them to seek the reasons behind it, and to the conviction that by creating similar business structures they would become equally successful. Therefore, I do not state that there is a general model for promising development or for lasting profit but I will show how industrialists, politicians and competitors in different branches and countries perceived that there might be a model or exemplar. 

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