Competing on Technology

by Marty Alchin on October 14, 2010

So today, Jesse Noller wrote up an interesting article about how to compete in a market once Google makes an appearance. He makes a lot of valid points, but I wanted to take a step further and try to explain why I think we shouldn’t be looking to Google for points on how to run a business these days.

I’m an open source nut. It’s not about free software, whether as in speech or beer. It’s not about the personal satisfaction from helping others learn how to make something awesome. It’s not even about the thrill of tinkering with something to figure out how it works, though that’s probably the most fun of the whole thing. No, I love open source because it helps force companies to compete on more than just technology.

Competing on technology is almost as bad as competing on price.

We’ve all heard the stories. A couple of guys in their garage/basement/loft spend a few days/weeks/months building some awesome bit of technology that threatens the market leaders. It’s true that anybody with a computer, some knowledge and some free time can replicate just about whatever somebody else is doing. Sure, there are some limitations to just how closely you can mimic another service, particularly when speed and reliability are at stake (those things cost money, you know).

So for those of us really wanting to differentiate ourselves, Jesse rightly suggests that we try to compete on things other than technology. Bring more to the table than others can bring. Know more about your users, their needs and how you can address those needs. Care more about your users, their motivations, their passions and the reason they’re using your software in the first place. Not everybody can put themselves in their users’ shoes, and even fewer bother to try. If you design for humans first, you can set yourself apart. I won’t pretend that it’s easy; it’s not. But it’s worth it.

Now, reading this after Jesse’s article, you might think I’m suggesting that Google’s business model is unsound, and that they can’t possibly survive in the long term. I don’t know about the odds of Google’s long-term success, but it’s important to realize that Google doesn’t compete on technology. Google is a member of a fairly small club in the grand scheme of companies.

Their technology got them far enough head in a short enough time that they built themselves a reputation.

That’s an important distinction. Google’s core services are good enough to have earned them a reputation for quality. They worked hard for that reputation, especially since they did it with very little traditional marketing over the years. But at the end of the day, that’s really what they’ve got. As Jesse mentioned, when Google releases something, people flock to it, but not because it’s an awesome piece of technology, but because it’s Google. It’s that reputation that gets people to show up, and that’s what they use to crush (or buy) their competitors.

In a way, Google is even worse than competing on technology, because they don’t even really have to innovate to succeed. But because reputation can’t be created in a garage/basement/loft, they still have something powerful to bring to the table, and that’s why they’re such fearsome competitors. They’ve built a wave (no, that that wave), and they’re riding it all the way to the bank.

That sword cuts both ways, though. It can bring a ton of people to a new service overnight, but sometimes they seem to rely on it too much. Some of their offerings seem to just expect that everyone will show up and use it, regardless of whether it’s actually useful for anything, much less whether it’s enjoyable to use. It’s that side of their offerings that makes me wonder about their longevity, but they’re far too big to start pretending they’re on their way out.

The natural comparison, though, is Apple. Jobs and company don’t get into just anything, and they don’t do much of anything half-heartedly. They focus on the people who use software and the experience they have while using it. They hire people who genuinely care about people and how they interact with technology, and that passion shows through in their products. That’s what they bring to the table beyond technology. Sure, their tech is pretty awesome and it keeps getting better, but they choose their hardware offerings in service of a better experience for their customers. There are nearly always products that are technically superior, but Apple keeps doing better because they focus on more than the technology itself.

So in a nutshell, Jesse’s right that you should put people first. But it’s a bit more subtle than that. The key point is to offer more than just technology. User experience is a great place to go if you can, but there are other ways as well. Customer service, continuous improvement and community involvement can all help tremendously to differentiate you from your competition.

Don’t ask “What if Google does it?” Just try to bring whatever you can to the table that’s uniquely yours. Someone else might still make something technically better, but if there are other factors at play, you’re likely to have people who will latch on to those other factors, and if you’ve done a good enough job at those, your customers won’t be willing to give them up. Even for Google.