Theory of the 3 evergreen competitive advantages

I know I am too young to come out with a theory of the world. But then the young are expected to do stupid stuff.

For those of you who think I am talking about TOE (Theory of everything) i.e. the theory which describes all physical phenomena, then I am sorry.

Please see String Theory or Theory of everything.

What I want to talk about is the theory of the The 3 evergreen competitive advantages.

Why? Because just like that new mobile phone you bought a couple of months ago, human tech evolution and the speed of change/development today has ensured that almost every differentiated product and service you can think up of, will become commoditized even before you can say “Oh Shit”

But you already know that.

So if major multi-billion dollar corporations now struggle with sustainability of profits and have to churn out “sexy” “wow” and “awesome” products all the time, what can a small meek mortal like you do?

What can one do to ensure that the tidal waves of change don’t wash away all that competitive advantage you have created in your job/startup/life/company etc?

That’s where the theory of 3 comes into play.

This has been used for centuries by those who have understood it.

For anyone interested in history, pertinent examples will come up all the time in every setting of human civilization.

The three things one must continuously build on, sometimes in this particular order, to do well and stay ahead. 

1. Knowledge – Information is now commoditized, available to anyone with an internet connection. Its now our ability to join the dots, analyze information and predict outcomes in advance that leads to a build up of knowledge. Patents are useful, but with the speed of tech development they too have been rendered useless in many cases. Now, more than ever, a human mind that can pick up bits of information and make sense of them, in real time and execute , should be considered far more powerful that any computer with a million economic and business projection models. And I don’t mean, that becoming a geek is desirable, just that be good enough in whatever one choose to do, to be considered a geek.

Because they wrote it wrong. It was always “The Geek shall inherit the earth”

2. Reputation – Once you have knowledge in your hands, it is extremely important to cull a reputation from it by executing stuff. If you wont execute, you wont have results and hence no reputation. Brands, Rockstars, Doctors, Successful Executives all understand this. Otherwise you will end up being full of un-applied and hence non-verifiable knowledge that never did anyone any good. Oh and in my experience, the fact that “good schools” make you a well rounded person, is utter crap. Our future is only in the super-specialization of what we love to do.

3. Access – Finally, with a heavy tranche of knowledge and a solid reputation, you must aim for access. Access to the right people, with the right opportunities to offer. Its what helps get people jobs, projects, movies (take a quick look at the buffoons masquerading as actors) and other such stuff. Why? Because those who offer you the opportunity, need what you have built. A reputation and knowledge to push their interests along. No one does it because they like your face (admittedly, they might do it because they are mad, but don’t count on it)

Many successful startups have gone through these 3 steps and found great sustainable success.

In my next post I will give supporting evidence for these three. Just so that you know I have really thought about this stuff. And that I didn’t write this when I was high.

The Games Have Begun

The Games have begun

Remember this guy? He is the embodiment of an entire generation’s first contact with the world of video games. I remember playing it for days on that exotic ‘Little Master’ till I completed all the worlds. It created its own environment, characters, world and a compelling simple storyline. It is the ultimate uber-game and I know of many 35 yr old guys who still play the original dos version.

What has happened over the last 10 years with video games, is nothing less than a tectonic shift in how people consume media.

Our grandparents were introduced to radios as a source of entertainment. As a result it became not just part of their culture, but also affected their world view. With news, sports and other such programs radio became one of the mediums of personal development, knowledge and entertainment. The other was books, newspapers etc.

But it was our parents, the generation before us, who really grew up with the radio. And this medium became pervasive, simply because it had always existed for them and hence was the default medium. Admittedly the written word was and still is a major way in which we consume information.

In the same vein, TV became the primary technology of consumption for us and being the lucky generation that we are, we also co-opted the internet in the same way. So now most of us depend on both.

However, it’s the generation/s after us who will consider a new way of consuming media as the default/primary mode of. Video/Social/Smartphone Games.

The change is already happening. Most developed/developing countries already have the 10 to 20 year demographic playing more games than watching TV (wow) or reading books (no one is surprised by that).

Imagine what that will mean for our future. With gamification, already a buzzword being thrown around in Board of Director meetings, the pervasiveness of games in our lives, personal and social, will only increase. Schools have already started successfully co-opting them and xbox’s, smart phones, social websites (FB, Twitter, Orkut) etc are now in millions of hands and homes. Gaming already pulls in more revenues than Hollywood and Bollywood combined. Battlefield 3 by EA, one of 2011’s hottest releases (including movies and games), sold a whopping 5 million copies in its first week. More than 1.5 million people queued at 13,000 shops at midnight on to buy Modern Warfare 3, another great video game title, in 2011. They have grossed 1 billion dollars in just the last few months. Each.

To put that in perspective, as per today’s forex rates, Battlefield 3 made Rs. 5,132 Crores in 3 months. If Vijay Mallya was making video games instead of beer, he could have paid off Kingfisher Airlines debts. And saved face. Oh and by the way, Modern Warfare 3 made that money in 16 days. Infosys, with 1,40,000 employees made 6 billion in 1 year.

Popcaps. A company that makes games like Plants Vs Zombies was sold for 1.2 Billion Dollars. Rovio, the guys who made that adorable little game called Angry Birds, sell 1 million stuffed toys a month. I won’t even bore you with their revenues.

So are we really ready for a future, where most content will be in the form of games? Better make sure your kids are good at video games. You don’t want them to be left behind.

Have fun watching these trailers. Call it education.