{"id":32900,"date":"2025-07-01T04:45:29","date_gmt":"2025-07-01T04:45:29","guid":{"rendered":"https:\/\/financialrush.com\/?p=32900"},"modified":"2025-07-01T04:45:29","modified_gmt":"2025-07-01T04:45:29","slug":"in-defence-of-the-second-mover-advantage","status":"publish","type":"post","link":"https:\/\/financialrush.com\/?p=32900","title":{"rendered":"In defence of the second-mover advantage"},"content":{"rendered":"<p> \n<\/p>\n<div>\n<p>Stay informed with free updates<\/p>\n<p class=\"article__content-sign-up-topic-description o3-type-body-base\"><span>Simply sign up to the <!-- -->Artificial intelligence<!-- --> myFT Digest &#8212; delivered directly to your inbox.<\/span><\/p>\n<p><iframe class=\"article__content-sign-up-iframe close\" scrolling=\"no\" id=\"signUpIframe\" data-prev-url=\"\/register\/in-article-sign-up?ft-content-uuid=46885f98-6eac-4149-9bd6-6bdb6e732583&amp;concept-id=d2e5aa89-e168-416d-b41b-af8e847fb3cd\"><\/iframe><\/div>\n<div id=\"article-body\">\n<p>A note of threat has crept into the otherwise optimistic language of those who champion the adoption of artificial intelligence. <\/p>\n<p>You can hear it in the rhetoric of UK technology secretary Peter Kyle, who told workers and businesses this month: \u201cAct now, and you will thrive into the future. Don\u2019t, and I think that some people will be left behind.\u201d You can hear it in the marketing spiel used by software companies such as Salesforce: \u201cCompanies that fail to leverage AI in their business risk being left behind those that do.\u201d And you can hear it in the way some chief executives are beginning to communicate with staff. \u201cAI is coming for your jobs,\u201d Fiverr chief executive Micha Kaufman wrote in a memo to staff last month. \u201cAre we all doomed? Not all of us, but those who will not wake up and understand the new reality fast, are, unfortunately, doomed.\u201d<\/p>\n<p>But is it true that to \u201cact now\u201d or be \u201cleft behind (and\/or doomed)\u201d are the only two options available? <\/p>\n<p>Of course, there <em>is<\/em> such a thing as a first-mover advantage, and you can see why that might accrue to some companies that race to install new AI systems such as autonomous agents. If these investments lead to lower costs and higher productivity, a pioneer could offer a lower price or better service to customers and capture more market share. First-movers also have a better chance of working with tech vendors to shape new systems around their own needs. And for client-facing companies such as consultancies, having a reputation as a first-mover probably helps them to sell their AI expertise to clients.<\/p>\n<p>But there is such a thing as a \u201csecond-mover advantage\u201d, too \u2014 even in sectors which depend on powerful network effects. Facebook overtook MySpace. Google overtook Ask Jeeves. And \u2014 as one senior business executive noted recently in a round-table discussion I attended \u2014 agentic AI might prove to be one instance where the second-mover advantage is rather strong.<\/p>\n<p>Being a second-mover is particularly useful when the benefits of a new technology are uncertain and the risks are high, because what you lose in speed you gain in information. You can watch what the first-movers do, make note of their blind alleys and their mistakes, and then chart a more effective course. You are more likely to avoid becoming locked in to technology vendors that ossify your workflows but whose products prove to be inadequate. A <a href=\"https:\/\/www.mckinsey.com\/capabilities\/quantumblack\/our-insights\/seizing-the-agentic-ai-advantage\" data-trackable=\"link\">recent report<\/a> by McKinsey, which advocates for agentic AI, warns of a whole host of other risks too, such as \u201cuncontrolled autonomy, fragmented system access, lack of observability and traceability, expanding surface of attack, and agent sprawl and duplication\u201d.<\/p>\n<p>My argument here is not against the idea that some companies should move quickly (as of course they will, and are) but simply that to be temporarily \u201cleft behind\u201d can be a valid strategy too. It doesn\u2019t necessarily mean you will be a loser in the long-run. One <a href=\"https:\/\/www.gov.uk\/government\/publications\/barriers-and-enablers-to-advanced-technology-adoption-for-uk-businesses\/factors-influencing-firms-adoption-of-advanced-technologies-a-rapid-evidence-review#:~:text=In%20the%20second%2Dmover%20strategy,Nafizah%20et%20al\" data-trackable=\"link\">study<\/a> of technology adoption by UK microbusinesses in the 2010s (albeit this was an earlier generation of pre-generative AI technologies) found that companies that adopted AI enjoyed higher subsequent innovation capacity, regardless of whether they were first-movers or second-movers.<\/p>\n<p>Indeed, the message that you should \u201cact now or miss out\u201d has more in common with high-pressure sales techniques than business strategy. Online retailers use <a href=\"https:\/\/www.gov.uk\/government\/publications\/online-choice-architecture-how-digital-design-can-harm-competition-and-consumers\/evidence-review-of-online-choice-architecture-and-consumer-and-competition-harm\" data-trackable=\"link\">\u201curgency claims\u201d<\/a> such as countdown clocks because they work: the academic literature suggests consumers under time pressure use mental short-cuts to make decisions. Urgency claims can also instil a fear of loss, a sense of competition with others, and a \u201cbandwagon effect\u201d whereby people are given the impression that everyone else is already doing or buying something.<\/p>\n<p>It should be no surprise that technology companies are using these well-known marketing strategies: they have something to sell, and an awful lot of <a href=\"https:\/\/www.ft.com\/content\/eb1f7a80-6a4f-436d-8578-61020fa4b216\" data-trackable=\"link\">capital investment<\/a> on which they need to make a return. But there is no need for politicians and business leaders to echo them, especially not by extending the threat to staff. It is well-known in neuroscience that when the brain\u2019s fear system is active, its ability to explore, innovate and take risks is diminished. If you want staff to experiment with how to implement AI effectively, making them fear for their jobs is not the best way to do it. They are also less likely to be honest about emerging risks, for fear of looking like a naysayer.<\/p>\n<p>It is fair enough for tech companies with products to sell to repeatedly urge the world to \u201cact now or lose out\u201d. But the rest of us needn\u2019t confuse a sales technique with anything more profound.<\/p>\n<p><a href=\"https:\/\/www.ft.com\/content\/mailto:sarah.oconnor@ft.com\" data-trackable=\"link\"><em>sarah.oconnor@ft.com<\/em><\/a><\/p>\n<\/div>\n\n<br \/><a href=\"https:\/\/www.ft.com\/content\/46885f98-6eac-4149-9bd6-6bdb6e732583\">Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"Stay informed with free updates Simply sign up to the Artificial intelligence myFT Digest &#8212; delivered directly to&hellip;\n","protected":false},"author":7,"featured_media":32901,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[],"class_list":["post-32900","post","type-post","status-publish","format-standard","has-post-thumbnail","category-tech","cs-entry","cs-video-wrap"],"_links":{"self":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/posts\/32900","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/users\/7"}],"replies":[{"embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=32900"}],"version-history":[{"count":0,"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/posts\/32900\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/media\/32901"}],"wp:attachment":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=32900"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=32900"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=32900"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}