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Business Information Systems

-Explain why sometimes the follower and not the first mover of a new technology is more successful in the market place.
-Discuss the timing of entry strategies into the market for new products. What assumptions underlie the use of such strategies?

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First Mover vs. Follower

New technologies are happening at a very fast pace; so fast in fact, "one wonders how any enterprise could adequately plan to respond quickly enough to leverage such changes for competitive advantage" (Trembly, 2009). As the technologies improve, and new players come into the marketplace, the question must be asked why do followers of new technologies sometimes become more successful in the marketplace than the first mover of the technology. This question is not without merit. Some examples of this phenomenon can be seen in Betamax vs. VHS. Sony's Betamax came out a year before VHS, but after going over the trial and error of Betamax, VHS perfected the technology more proficiently (The betamax vs vhs format war, 2005). There are many reasons that this happens, mainly the disadvantages of the first mover becomes the advantage of the follower. Late entrants can copy the innovator; imitation cost can be considerably lower. The follower has the advantage of seeing the new technology and finding a suitable substitute for the technology. The follower also can use marketing advantages to their favor ...

Solution Summary

This 725 word solution provides 4 quality references to substantiate the material. It explains the first mover and follower relationship. The solution also gives good information on the timing of entry strategies, as well as, provides reasons that a follower is sometimes in better position than a first mover.