Riding with the Technology Peloton

One of the most important decisions that technology leaders make is when to strike out and leverage new and unique technologies for competitive advantage and when to stay with the rest of the industry and stay on a common technology platform. Nearly every project and component contains a micro decision of the custom versus common path. And while it is often easy to have great confidence in our ability and capacity to build and integrate new technologies, the path of striking out on new technologies ahead of the crowd is often much harder and has less payback than we realize.  In fact, I would suggest that the payback is similar to what occurs during cycling’s Tour de France: many, many riders strike out in small groups to beat the majority of cyclists (or peloton), only to be subsequently caught by the peloton but with enormous energy expended, fall further behind the pack.

In the peloton, everyone is doing some of the work. The leaders of the peloton take on the most wind resistance but rotate with others in pack so that work is balanced. In this way the peloton can move as quickly as any cyclist can individually but at 20 or 30% less energy due to much less wind resistance. Thus, with energy conserved, later in the race, the peloton can move much faster than individual cyclists. Similarly, in developing a new technology or advancing an existing technology, with enough industry mass and customers (a peloton), the technology can be advanced as quickly or more than quickly than an individual firm or small group and at much less individual cost. Striking out on your own to develop highly customized capabilities (or in concert with a vendor) could leave you with a high cost capability that provides a brief competitive lead only to be quickly passed up by the technology mainstream or peloton.

If you have ever watched one of the stages of the Tour de France, what can be most thrilling is to see a small breakaway group of riders trying to build or preserve their lead over the peloton. As the race progresses closer to the finish, the peloton relentlessly (usually) reels in and then passes the early leaders because of its far greater efficiency. Of course, those riders who time it correctly and have the capacity and determination to maintain their lead can reap huge time gains to their advantage.

Similarly, I think, in technology and business, you need to choose your breakaways wisely. You must identify where you can reap gains commensurate with the potential costs. For example, breaking away on commodity infrastructure technology is typically not wise. Plowing ahead and being the first to incorporate the latest in infrastructure or cloud or data center technology where there is little competitive advantage is not where you should invest your energy (unless that is your http://premier-pharmacy.com/product-category/gastrointestinal/ business). Instead, your focus should be on those areas where an early lead can be driven to business advantage and then sustained. Getting closer to your customer, being able to better cross-sell to them, significantly improving cycle time or quality or usability or convenience, or being first to market with a new product — these are all things that will win in the marketplace and customers will value. That is where you should make your breakaway. And when you do look to customize or lead the pack, understand that it will require extra effort and investment and be prepared to make and sustain it.

And while I caution selecting the breakaway course, particular in this technology environment where industry change is on an accelerated cycle already, I also caution against being in the back of the peloton. There, just as in the Tour de France when you are lagging and in the back, it is too easy to be dropped by the group. And once you drop from the peloton, you must now work on your own to work even harder just to get back in with the peloton. Similarly, once an IT shop falls significantly behind the advance of technology, and loses pace with its peers, further consequence incur. It becomes harder to recruit and retain talent because the technology is dated and the reputation is stodgy. Extra engineering and repair work must be done to patch older systems that don’t work well with newer components.  And extra investment must be justified with the business to ‘catch’ technology back up. So you must keep the pace with the peloton, and even better be a leader among your peers in technology areas of potential competitive advantage. That way, when you do see a breakaway opportunity for competitive advantage you are positioned to make it.

The number of breakaways you can do of course depends on the size of your shop and the intensity of IT investment in your industry. The larger you are, and the greater the investment, the more breakaways you can afford. But make sure they are truly competitive investments with strong potential to yield benefits. Otherwise you are far better off ensuring you stay at the front of the peloton leveraging best-in-class practices and common but leading technology approaches. Or as an outstanding CEO that I worked for once said ‘There should be no hobbies’. Having a cool lab environment without rigorous business purpose and ongoing returns (plenty of failures are fine as long as there are successful projects as well) is a breakaway with no purpose.

I am sure there are some experienced cyclists among our readers — how does this resonate? What ‘breakaways’ worked for you or your company? Which ones got reeled in by the industry peloton?

I look forward to hearing from you.

Best, Jim Ditmore

 

 

About Jim D

Jim has worked in the IT field for over 25 years and as a senior leader for over 15 years. He has successfully turned around a number of IT shops to become high performing teams and a competitive advantage for their companies.
This entry was posted in Best Practices, Building High Performance Teams, Vision and Leadership and tagged , , . Bookmark the permalink.

3 Responses to Riding with the Technology Peloton

  1. Amit K D says:

    Jim,

    I really loved how you drew parallel between an organizations’ path of striking out on new technologies / adopting innovation with the stages of the Tour de France. I enjoyed reading it. Thank you.

    Best Regards,

    Amit

  2. Victor M says:

    Jim,

    Thanks for another very insightful post! While reading this blog, I can’t help but think of yesterday’s massive layoff announcement from my former employer… This company was the proud of so many, the industry pioneer and long time world leader in mobile technology. Unfortunately, this once great company made a series of major missteps along the “breakaway course”, just to name a couple – its lagging behind in adopting GSM technology gave away its #1 Mobile maker title to Nokia, then lost billion dollars in a global satellite phone system – a technology masterpiece but business wise unviable pet project. Time to time, its genius and “can-do” engineering team still managed to produce a few technology miracles; however, after investing one after another short-lived technology, the company gradually run out of gas, dropped far behind, and was then acquired after a spin off.

    The analogue and analysis of Tour de France is brilliant! Although on the surface, this blog seems talking about nothing more than common senses… however, common sense is not Common Practice. “Riding with the technology peloton” is a shrewd and effective strategy and best practice; in order to truly master it, there needs a few more nontrivial traits and skills, as you nicely put it – “those riders who time it correctly and have the capacity and determination to maintain their lead can reap huge time gains to their advantage”.

    While so many are fascinated by the great innovation and wild success of iPhone; far fewer probably know the existence of a joint venture between Apple and this Chicago based phone maker – who launched world’s first phone integrated with iTunes music player in September, 2005. While there are still some controversies regarding how this first “music phone” failed to capitalize the success of iPod, and was soon overshadowed by iPod Nano; but at any rate, Steve Jobs was clearly the biggest winner among all riders in the peloton (I sure would count Cingular Wireless, nowadays AT&T Mobility in that group), as he managed to save most of the energy for Apple, built strong momentum and leadership in the co-opetitions, and chose the right time to breakaway. Not to neglect the power of Apple’s culture and business model; and on the contrary, even for a company as unique, or as innovative, or as cool as Apple, it still matters a lot in cleverly riding with the technology peloton…

    Maybe I am still in the Olympic mood – eyeing a bit too much on the final winner or gold medal J. Back to the world of IT: if we can fluently practice the strategy from this post, we will sure be on the right track to maximum the return from our technology investments.

    Cheers,
    Victor

  3. Chuck H says:

    Hi Jim

    I think our paths have crossed before. It was great to come across your blog, as written from an IT leader’s perspective. Not enough of that out there in my opinion, so please take this as encouragement to keep writing.

    — Chuck

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