To be successful, what must small high-tech companies do? Do they have to have substantial capital and patent protections? Do they need to be more flexible than larger competitors and/or be...
To be successful, what must small high-tech companies do? Do they have to have substantial capital and patent protections? Do they need to be more flexible than larger competitors and/or be marketing pioneers? Do they need to engage in expeditionary marketing?
To be successful, small high-tech companies must be flexible -- something that is often easier for a small company with minimal overhead than for a large management-heavy conglomerate -- and must protect its innovations from corporate espionage or theft, a common problem faced by small innovative companies.
Small high-tech companies enjoy the benefit of having minimal resources invested in design, engineering, manufacturing, marketing and sales than do larger competitors. This does not, however, mean that the small companies are leveraged any less financially. On the contrary, smaller companies often have a far greater percentage of their total assets invested in the company than do the top officials of major corporations. In this regard, the need for capital is certainly important. It is not, however, the lynchpin for success. Innovation and flexibility are both absolutely essential for small high-tech companies to enter a market and make inroads at the expense of larger, better-established competitors.
The importance of patent protection cannot be overestimated. It is not uncommon for small innovators to go bankrupt while waiting for the U.S. Patent and Trademark Office to approve an application as larger companies steal their ideas and rush them into the marketplace.
With regard to marketing, small high-tech companies are heavily dependent upon the success of their marketing practices. These practices do need to include what is known as "expeditionary marketing," the search for new markets in untried areas with the introduction of a series of products, the intent being to rapidly create a sense of product identification and name recognition. In addition, marketing in the age of the Internet places a premium on knowing how to manipulate data searches to ensure that one's product or company name is among the first to appear in response to word searches by prospective customers.
As the category of industry under discussion is "high-tech," the best and most prominent model for study would be Apple, which didn't pioneer the personal computer -- Kaypro and Osborne were there first -- but which perfected it and made it a household commodity -- all with minimal upfront capital, but with brilliant marketing and protection of intellectual property.