Value Matrix for Speed to Market

The advantages derived from improving Speed-to-Market depend upon a company’s brand image or reputation.  The best way to segment this viewpoint is via a “Value Matrix for Speed to Market” that segments based on Relative Cost vs. Performance.

On the x-coordinate is the company’s relative cost to provide a product or service vis-à-vis its competitors.  On the y-coordinate in the company’s product or service’s relative performance vis-à-vis its competitors.  The performance measure is a combination of customer perceived features, quality, and service levels. 

Speed-to-Market Offers IP & Development Cost Protection

Brands that offer low performance service at a low price (think Virgin Airlines) are in the lower left quadrant.  These firms benefit most from avoiding Speed-to-Market initiatives by having lower development costs derived from being able to reverse engineer First Mover and Fast Follower work (shown as a blue line in the “Speed to Market Offers IP and Development Cost Protection” figure).

It is noted however that if a First Mover takes advantage of IP protection for its new products and services, then the development costs of Fast Followers and Laggards can be relatively increased rather than decreased).

Speed to Market Offers Market Share & Pricing Advantages

Brands that offer high performance service at a high price (think Singapore Airlines) are in the upper right quadrant.  These firms benefit most from Speed-to-Market initiatives by introducing desirable new services and in-flight features faster than their competition, thereby sustaining high product and service prices (shown as a blue line in the “Speed to Market Offers Market Share and Pricing Options” figure). These premium price points can be protected by acquisition of appropriate IP available to First Movers.

Brands that offer both relatively high performance service at a relatively low price (think United or Lufthansa Airlines) are in the upper left quadrant.  These firms benefit most from Speed-to-Market initiatives by gaining market share from their competitors via fast-following with new features and services ahead of industry laggards (shown as a gold line in the “Speed to Market Offers Market Share and Pricing Options” figure).

By understanding a company’s branding positioning in the Value Matrix, the benefits that a Speed-to-Market initiative can provide can be appropriately targeted.

Speed to Market Offers Business Model Options

A final advantage of Speed-to-Market that affects all companies is that entities with a faster Speed-to-Market can “pivot” into a larger variety of successful product & business models (shown as orange target areas in the “Speed to Market Offers Business Model Options” figure). Fast Follower and Laggards have their options reduced and made more difficult by forcing them to conduct next-generation or ultimately breakthrough innovation to gain market entry.