Looking back at historical moments can provide important lessons for leadership and strategy. Even if we go as far back as the late 1990’s, the stone age of the current digital revolution.
My historic snapshot is about two companies which were both very late to enter the global mobile phone industry, with big ambitions and bold innovation, but with vastly different results. One became the industry leader, the other one of the industry’s biggest flops.
Samsung and Iridium entered the cell phone market in 1996 and 1998 respectively, well after other key players, when the market was already saturated. Samsung became the no. 2 player within 5 years (behind Nokia) due to its focus on customer-cantic innovation: larger size (at the time phones were too small to be used easily) less functions (phones on the market were overladen with complexity) and fun elements (large color display and ringtone variety). And of course, a few years later, Samsung became the industry leader.
Iridium on the other hand, positioned itself as the first company to deliver satellite-based, global coverage for mobile phones, backed by Motorola. It promptly went bankrupt in 1999, just nine months after launch, because its phones were too big, very expense to operate, and did not work within buildings (just a slight limitation). The $6B worth of satellite equipment was sold for $35m in 2002.
The contrast between the two is a great lesson in the importance of customer-centricity to innovation, and in the futility of technology-based innovation that lacks customer utility.
