“Pioneer or imitate?

An analysis of business imitations”

AUTHORS Gwendoline Vusumuzi Nani

Gwendoline Vusumuzi Nani (2016). Pioneer or imitate? An analysis of business

ARTICLE INFO imitations. Problems and Perspectives in Management, 14(3-3), 691-697.
doi:10.21511/ppm.14(3-3).2016.12

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 Problems and Perspectives in Management, Volume 14, Issue 3, 2016

Gwendoline Vusumuzi Nani (South Africa)

Pioneer or imitate? An analysis of business imitations

Abstract
Pioneering is meant to create a competitive advantage for businesses and yet imitations are accelerating globally,
leaving businesses not knowing whether to pioneer or imitate. The purpose of this study was to make an analysis of the
benefits and costs of pioneering and imitation, with the aim of possibly helping businesses to decide on which route to
take, after considering their strengths and weaknesses. This was a desk research study which analyzed literature on
business imitation and pioneering. It focused on imitation driven by technology; be it in products or services with a
bias towards legal innovative imitation. The analysis was primarily dominated by literature obtained from developed
countries because of the rich pool of research output on both concepts. Based on the findings, the paper concludes that
most businesses are innovative imitations and technology has facilitated most of these imitations. Recommendations
are that businesses should adopt innovative imitation, but do so legally and ethically. There is also need for more
research studies on business imitation in order to come up with strategies that will accommodate global players.
Keywords: pioneers, competitive advantage, innovative imitation, global players, first mover.
JEL Classification: L26, M19.

Introduction and background available in Zimbabwe. The implication is that even

those who accuse others of having imitated their
Business imitation is a phenomenon that has been in
business ideas are also imitators.
existence for a long time although it might take time
to appreciate its usefulness. As far back as 1966, The question that quickly comes to the fore is “Is
Levitt postulates that imitation was more abundant imitation a bad strategy after all?” Contrary to
that innovation and was a more prevalent road to negative connotations, available literature indicates
business growth and profits. Despite its possible that despite the stigma that goes with imitation, there
positive contributions, business imitation has been a are businesses that have recorded successes as a
stigmatised phenomenon to the extent that even result of following the innovating pioneers. These
those businesses that imitate do not want to be businesses include McDonalds, Visa, Walmart and
labelled thus. According to Shenkar (2010), Microsoft who imitated, but improved on the ideas
imitation has been regarded as undignified, found by others (Shenkar, 2010). According to the
objectionable and done by people who are Economist (2012), even in High Technological
unoriginal and yet, in his view, imitation is a Product Development, it is not the pioneers, but the
complex and demanding process that requires high imitators that have led these successful businesses.
intelligence and advanced cognitive capabilities. For example, the iPod was not the first portable MP3
The researcher concurs with the afore said that player; the iPhone was not the first smart phone and
the iPad was not the first tablet, but are now three
imitation requires a high level of mental capacity,
products that dominate the category. It is because
because an imitator who really wants to generate
Apple imitated and made them more appealing to the
revenue from the imitation, first, has to decide what
consumers. The researcher holds similar perceptions.
to imitate, the skills and resources required when
A closer look at businesses in everyday life shows
imitating and the possible reactions of customers;
that most of the business ideas were copied but
otherwise, the whole exercise will come to naught. improved upon. In some cases, imitation has been
Milan, Iryna and Karl (2014) allude to the fact that done so well that it is almost difficult to say who the
imitation has been viewed negatively and in some imitator was. It is important to note that these
cases, considered to be immoral, illegal and a successful businesses did not just plagiarise; they
harmful phenomenon and yet imitation or copying is imitated and improved on the ideas.
a natural phenomenon and that the world works on
the basis of imitation. Negative sentiments have also Despite the outcry by business players who call
been expressed in the music industry where some themselves pioneers that businesses similar to theirs
prominent musicians have accused upcoming artists are imitations, the reality is that imitation is with us.
of illegally copying their music. However, Muranda Therefore, there is a need to carry out research
and Maguraushe (2014) argue that these popular studies to find out the benefits and costs of imitation
musicians developed their music by modelling on to enable businesses to decide whether it would be
foreign popular musicians’ songs, which were locally more beneficial to pioneer or imitate. Shenkar
(2010, p. 2) suggests that:
 Gwendoline Vusumuzi Nani, 2016. “We need to understand the specific edges of imitation
Gwendoline Vusumuzi Nani, Department of Business Management,
College of Economic and Management Sciences, University of South
without oversimplification: how it works, what
Africa, South Africa. capabilities it requires, as well as the specific
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Problems and Perspectives in Management, Volume 14, Issue 3, 2016

strategies it applies to. It is not about deciding 2. Research questions

overnight that imitation is more beneficial. We need to The study was guided by the following research
understand why it is more beneficial, use it as questions:
intellectual tool in the academic field and as a
strategic object in company management”. 1. What are researchers’ perceptions regarding
pioneering?
It is in the above context that this analysis was
2. What are researchers’ perceptions on business
conducted, because before a business can decide
imitation?
whether to pioneer or imitate, there is a need to fully
3. What are the managerial implications that can be
understand what the strategy entails, its positives and
drawn from these perceptions?
negatives and whether the business has capacity or not.
3. Literature review
Okpara (2007) asserts that in a competitive
environment, there is a need for businesses to seek out It is crucial right from the outset to explain the terms
new opportunities which they can convert into goods that were used in this study for contextualization
and services. This situation calls for managers to make purposes. This study focused on pioneers sometimes
appropriate, relevant and timeous decisions in order to referred to as first movers, trendsetters, inventors,
survive. However, the researcher is of the view that innovative pioneers, creative imitators and early
even if businesses might want to imitate, the entrants. According to Okpara (2007), invention
stigmatization that goes with imitation presents means creating something new; something that has
managers with challenges of which route to take. never existed before which is yet to be desired by
Because businesses are part of the global village and customers. It is in the context of coming up with new
are now faced with global competition, they have to products and services that the term pioneering was
make decisions on whether to pioneer or imitate. The used in this study. Imitators in this study were used to
same author further argues that pioneering is an refer to people who do not originally own the ideas
important strategy for a business in today’s dynamic and are sometimes called copycats, emulators or
and competitive environment. The researcher is of the followers. Any other terms that people synonymously
belief that while this might be true, financial use for imitations such as counterfeits or product
constraints faced by businesses, especially in pirates did not form part of the study. According to
developing countries, might make this strategy a Militaru (2011), counterfeits or product pirates are
difficult one to adopt. All the same, results from such a copies that carry the same brand name or trademark as
study, where the pros and cons of pioneering and the original and these are strictly illegal. Counterfeits
imitation are exposed, might assist managers in are usually low quality, shoddy goods, but sold under
making informed decisions. the guise of a premium price of the seller’s respected
1. Statement of the problem brand names. Counterfeits were excluded from the
study, as the main emphasis was on legal imitation.
The rapid rate of technological and environmental
changes has made the order of entry one of the most 3.1. Pioneering – benefits and costs. Pioneers are
crucial decisions for business survival and developers of products or services. Mittal and Swami
performance in today’s world (Mittal and Swami, (2004) define pioneering businesses as those that
2004). While businesses might want to pioneer, they produce new products, use new processes and are the
find out that their ideas are immediately imitated and first to enter new markets. Pioneers derive the
yet they will have borne the costs of pioneering. following advantages by being the first to hit the
Choosing imitation as the route to take might not be market. Robinson and Min (2002) assert that pioneers
the best option, as it is a stigmatized phenomenon. have significant higher survival rates than early
This creates a dilemma for managers on whether to followers do. The pioneer’s temporary monopoly and
pioneer or imitate given the global competition that its first mover advantage tend to offset the survival
they are faced with. This scenario, therefore, creates a risks of market pioneering. The longer the first entrant
need for managers to be informed of the pros and can dominate the market in monopoly before the entry
cons of choosing either strategy. While there is of first rivals, the greater is the head start. Pioneers
abundant literature on pioneering and imitation, may possess some amount of customer loyalty,
especially in developed countries, this study is the distribution network and an established product line.
first of its kind to focus on whether businesses should Boulding and Christen (2001) posit that pioneering
pioneer or imitate in developing countries such as offers a large and lasting impression on customers,
Zimbabwe. Therefore, the purpose of this non- strong brand recognition and the first right to choose
empirical study was to analyze the costs and benefits suppliers. Mittal and Swami (2004) contend that
of pioneering and imitation with the aim of possibly besides the long term competitive advantage enjoyed
enabling businesses in developing countries to decide by pioneers, research has shown that in the developed
on which route to take in order to survive in this markets of the world, pioneers have better
technologically competitive global environment. performance and profitability than followers.
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However, Cottrell and Sick (2002) feel that a first Imitators’ work is based on the market reaction to the
mover strategy should be approached with skepticism. initial innovation and that the process of copying is
Hamel (2001) postulates that if you want to profit from often accompanied by functional improvement of
a first mover advantage, you have to make sure you original ideas. According to Shenkar (2010) in Milan
start with a unique strategic insight, at least initially et al. (2014), imitations are prevalent in the
unattractive to would be competitors, protected by a automotive, textile, leather, fashion and cosmetics
wall of patents. Cottrell and Sick (2002) emphasize industry and construction machinery. In the services
that being the first is not the essence, but being the first industries, imitations are found in the banking
so that the first mover’s temporary monopoly position systems, tourist destinations, shops, supermarkets and
can be exploited long after the monopoly has been lost electronic shops among others.
is what matters. The same authors further propose that
a choice of entering a market as a first entrant should Baradello and Salazzaro (2012) postulate that there are
be compared to the option of delaying the entry and two types of imitation: duplicative and creative
keeping an eye on competition. Being well prepared to imitation. The former refers to the transfer of
enter the market as the second mover might be a good technology for the production of identical goods to
strategy (Cottrell and Sick, 2002). What is important is those of the competitor. The latter provides an active
to be the first to put together the precise combination participation at the process of production by businesses
of features, value and sound business economics that that have focused the business not only to copy
unlocks a profitable new market. existing products, but also to make improvements to
the previous versions of the product or adapt it to new
Pioneering is important, because prior to any uses. Milan et al. (2014) assert that creative imitation is
imitations and innovations, there have to be not meaningless copying and plagiarism, but is a smart
pioneered ideas. Imitations and innovations are of
quest for improved functional and other characteristics
existing business ideas. Therefore, if there are no
of products or services. The researcher is of the view
pioneers, there could be a risk of running out of ideas,
that duplicative imitation might not make economic
and businesses cannot afford that risk considering the
pace at which change is occurring. However, while sense anymore. Consumers, for which these products
pioneering might have its advantages, there are also or services are developed, are now exposed to global
disadvantages. According to Zhou (2006), in the high products and, therefore, it is imperative that these
technological industry, there are high risks faced by businesses work towards meeting the consumers’
pioneers in terms of choosing to follow the true needs in this globally competitive business
technology and of product acceptance by the demand. environment though doing business differently.
Robinson and Min (2002) add that on the whole, a Creative or innovative imitation would create variety
market pioneer or a first mover meets a significant for the consumers and, thus, add value to the
amount of uncertainty in forecasting customer business and society at large. The researcher feels
response, technological development and the that duplicative imitation might be costly in the
maturity of the first generation technology. Mittal and sense that it requires that a business should possess
Swami (2004) agree that it is risky and expensive to adequate financial and human resources to be able
be a pioneer. The costs of development are huge, as to produce replicas of the products and services that
the first business to enter the market has to are being imitated.
conscientize the consumers of the product and This study focused on innovative imitation driven
convince them to buy that particular product. The risk by technology whether in product development or in
of failure might be high, as the potential demand offering of services. The focus was not on imitation
might not be certain. Having exposed the benefits and in the technological industry per se, but looked at
costs of pioneering, the next section focuses on technology being a driving force or a facilitator in a
imitation along similar lines. lot of imitations that are occurring today. Taking
3.2. Imitation – benefits and costs. Shenkar (2010) into cognizance what has been unveiled by
opines that although innovation is a highly praised literature, most of these businesses are imitations
value, the road to success could lie in the art of and a close analysis of the examples that have been
imitation. Shenkar (2010) also remarks about the pace given indicates technology as the facilitator in the
of imitation that has increased significantly, because imitation process. In addition, examples given
from 1870 it took about 40 years to imitate something. subscribe more to creative or innovative imitation
It now takes an average five years to and with generic than duplicative imitation, because imitators did not
drugs it only takes an average two months to imitate. just copy, but they made improvements to the
This raises questions of what imitation is and what its products and services that they had imitated, making
costs and benefits are. them more acceptable and appealing.
According to Milan et al. (2014), imitation is the Those that have chosen imitation as the route to follow
search for new ideas and a permanent copy that have identified the following benefits. There are lower
enriches innovation and makes it acceptable. Research and Development (R & D) costs (Valdani
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Problems and Perspectives in Management, Volume 14, Issue 3, 2016

and Arbore, 2007; Shenkar, 2010 and Mittal and Many small businesses are started with original
Swami, 2004). Shenkar (2010) adds that imitators business or product ideas. To ensure that these
benefit from hindsight and avoid all costly teething entrepreneurs or creators of the intellectual property
problems. Robinson and Min (2002) concur that early (or their employers) will derive the full commercial
followers get to learn from the mistakes their benefit of it and not an unauthorized user or infringer
predecessors have made, and may enter the market using the intellectual property, it is essential that legal
equipped with an improved solution. According to protection be obtained. Intellectual property can be
Baradello and Salazzaro (2012) and Mittal and Swami protected by means of copyright, the registering of a
(2004), there is less risk of failure in imitation, because patent, a trademark or a design. Jacobs (2014) further
the product or service being imitated will already have asserts that the Bene Copyright Convention covers
been tested in the market and customer adoption issues most countries of the world and lays down basic
will have been well understood. Pioneers capture only principles of copyright law that all member countries
a small fraction of the market share for their product have to comply with. Copyright protects the author of
over time, while imitators, copycats and others gain original works from others making a reproduction of
the lion’s share of the available market. While the copyright work. Works that qualify for copyright
imitation might appear to have benefits, there are costs are literary works, musical works, and published
incurred. According to Gary, Larsen and Markides editions among many. Copyright law protects the
(2006), by imitating, a firm gains legitimacy and reputation and identity of the creator by giving a right
access to resources, but it also loses its differentiation of action against unauthorized distortion or mutilation
and resorts to profit-eroding price competition. of the work in a way that is to the detriment of the
Baradello and Salazzaro (2012) agree that although honour or reputation of the creator.
copying is fairly common, success is not guaranteed.
In the high technology industry where there is a high Baradello and Salazzaro (2012) argue that imitators
concentration of a large number of imitations, most capture opportunities and are attracted by the industry
businesses in this sector focus more on technology for the weakness of industrial property rights,
than on the needs of the market. By so doing, these technological interdependence and the uncertainty of
businesses open doors to clever imitators who already technological trends. In the development of high tech
have their own customers to serve and to those able to products, companies implement imitative strategies
create differentiated products. depending on their objectives, resources, capabilities
and technologies and are organized in collaboration
3.3. Justification for and against imitation. Some with the direct competitors to win the definition of the
research studies have unveiled some of the reasons standard technology in the market. Shenkar (2010)
behind business imitations. According to Markides and postulates that the rise of imitation was also made
Geroski (2005), imitative strategies may provide more possible by the multiplication of alliances and
sustainable sources of competitive advantages for the partnerships which have led to sharing of technologies.
business. Bloodgood (2013) agrees and further posits Technological interdependence facilitates the flow of
that businesses seeking competitive advantage often information that leads to imitation within the industry.
rely on a combination of innovation and imitation to To protect themselves, some companies have even
improve their capabilities and performance. decided not to enter into alliances though is a difficult
Some imitators are forced by necessity to imitate. move considering the global scale in which companies
According to Muranda and Maguraushe (2014, p. 46). operate these days. Shenkar (2010) further asserts that
all these elements have weakened the leading role of
“Trendsetters tower as iconic figures. Upcoming “proprietary” knowledge. This leaves traditional
artists end up emulating trendsetters, because they do protections such as trademarks or licences also under
not have control over the means of production. threat. In addition, Baradello and Salazzaro (2012)
Impoverished by machinisations, they are left with no posit that the continuous contacts with other
option, but to create around what is perceived as companies within the value network, the absence of a
lucrative by record producing companies, not mere global regulation to defend industrial property rights
intent to plagiarise others’ intellectual property”. and the uncertainty about the industry are the
What is implied in this citation is that musicians determinants that stimulate the activation of company
imitate due to inadequate resources. imitation strategies.
While imitation may be the preferred route compared According to the Economist (2012), it is critical that
to pioneering, it is imperative to briefly discuss legal risk takers are able to harvest the rewards when those
aspects pertaining to imitation; that of intellectual ideas materialize. Therefore, imitators need to be kept
property to enable imitators to make informed at bay, granting legal protection through various legal
decisions. According to Jacobs (2014), intellectual protection tools offered by the market economy such
property refers to all creations or products of the as patents, copyrights, trade secrets and trademarks.
human mind that can be used for commercial gain. However, since these protections are offered country
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by country, the costs of filing in all possible markets is 5. Results and discussion
costly, laborious and complicated and for these
What has emerged from this literature review is that
reasons, small businesses limit their global expenses to
businesses are forced by different circumstances to
the most likely or key markets, leaving the rest of the
imitate and, as Baradello and Salazzaro (2012)
world unprotected, including countries with very poor
postulate, imitation will continue to have a role in
enforcement track records. Therefore, the researcher is
product development. Milan et al. (2014) assert that
advocating for legal and ethical creative or innovative
imitation has become a respectable factor of economic
imitation; imitation that is not meant to kill other
development. In this regard, the researcher feels that
people’s businesses or violate the copyrights of others,
the attitude towards this phenomenon has to be
but meant to benefit other businesses through cross
changed. Shenkar (2010) argues that although China
pollination of ideas. Whether we like it or not and
denies imitating products when they speak to the West,
whether we accept it or not, imitations are with us.
imitation is readily accepted in Chinese contemporary
Besides the issue of possible violation of property culture. Today China’s dramatic growth is closely tied
rights, the argument against imitation could be that it to its talent as an imitator.
promotes laziness. Knowing that there are business
Imitation or copying is a natural phenomenon and it is
ideas to be imitated does not incentivize people to
difficult to eliminate it just as children imitate their
come up with new business ideas. Knowing that
parents and workers their leaders. Imitation is present
imitation and innovation is a faster way to making
in the sphere of business, as companies look up to each
money might actually encourage laziness.
other and benchmark against each other’s way of
4. Research methodology doing business (Milan et al., 2014). Therefore,
businesses should refrain from regarding imitation as
The literature review was dominated by articles from
unintelligible, as imitators too undergo a thinking
the western perspective because of the extensive
process. There are a lot of considerations an imitator
research that has been conducted on pioneering and
should make such as the location of a business,
imitation. Of note was the immense contribution by availability and accessibility to resources and what
Oded Shenkar (2010) on the topic, while the absence features to add among other considerations. Instead of
of articles on the topic under study in the Zimbabwean looking only at the negative side of business imitation,
context was of concern. A qualitative approach was there is a need to focus on the positives that imitation
adopted for the study so that only those studies can bring or has brought. There are some businesses
concerning the costs and benefits of pioneering and that might appear to be duplicative imitations at face
imitations would be identified. To begin with, 104 value, but when searched deeply, they are actually
studies were initially identified and from that list the creative or innovative imitations.
researcher narrowed down the search and 17 relevant
articles were purposively selected and reviewed in The researcher is of the view that because of the
more depth. These were articles mainly published in global competition and the easy availability of ideas,
the last 16 years so as to establish the trends in the there is no time to really sit down and think of
topic under study. Key words such as business coming up with a brand new business idea. There is
imitation, innovation, creative imitation, pioneers, first pressure to make quick money that investing in new
mover, costs and benefits were used as search terms. ideas might not be worth it in the end. Businesses
This study focused on pioneers sometimes referred to would want to take quick options as long as the quick
as first movers, trendsetters, inventors, innovative options pay dividends in the end. The other factor
pioneers, creative imitators and early entrants. The that could be discouraging to the pioneers is flooding
articles that were finally excluded were those whose of the market by imitated goods which are cheap and,
content did not match the selection criteria. because customers are price sensitive, they purchase
these cheaper products. Furthermore, the level of
The purpose of this study was to use findings on costs unemployment is high especially in developing
and benefits of pioneering and imitation to assist countries forcing consumers to buy basic necessities.
businesses in deciding on which strategy to adopt. In the end, it becomes a waste of money, time and
Content analysis was used in the review. Although effort to worry about coming up with a brand new
research studies from developed countries were used, idea as long as one can imitate, innovate and make
the idea was to draw from their experiences and profits. Some products and services have been
perhaps come up with lessons for developing countries imitated and innovated so many times that they
such as Zimbabwe, as the researcher did not access appear like new business ideas.
any such study in the Zimbabwean context. The world
is now a global village and even though environmental Conclusions and managerial implications
factors might differ, there are lessons to get from the Based on the above discussion, the researcher
experiences of the developed countries. concludes that most businesses are what Shenkar
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Problems and Perspectives in Management, Volume 14, Issue 3, 2016

(2010) calls immovators; a combination of imitation infrastructure, capital, competences and skills to
and innovation. This is where imitators will copy the either pioneer or imitate. Such an assessment would
idea and, then, improve on it and do business help managers to determine whether they have the
differently. While businesses especially in developing expertise and resources necessary to exploit situations
countries might want to pioneer, resources are and make informed decisions of what strategy to
inadequate. Even if some businesses were to set aside adopt in order to create a competitive advantage.
some of their resources for purposes of pioneering, the Managers should not just adopt a strategy, because
risk of losses might not be worth the effort considering company X has done so, because they will not be
global competition. Moreover, businesses might not knowing the competences, the competitive
have the time to come up with brand new ideas advantage, the resources and sources of resources of
considering the pace of global competition. The best that company. Fourth, there is a need for a risk
could be to imitate, but innovate in order to meet the assessment of the strategy to be adopted, because
ever changing customers’ tastes and preferences. whatever strategy is adopted, there is a risk element.
Literature findings do not provide conclusive views Finally, instead of looking down upon themselves,
per se on whether to pioneer or imitate. However, imitators should actually develop capabilities to learn
based on the costs and benefits of pioneering and more or better from benchmarking and, therefore,
imitation exposed in the literature review, this paper imitate in a more innovative way. Although it does not
argues that before managers decide on whether to sound ethical, but that is probably the route businesses
pioneer or imitate, the following considerations should today could take in order to survive. As businesses in
be made. Firstly, managers should conduct an analysis Africa, particularly small and medium sized
of both the external and internal environments. It is businesses, continue to face liquidity challenges, it
crucial to assess the political, economic, socio-cultural, might be difficult to pioneer. If America that has the
technological, legal and international sub- resources will outsource and produce in China, to cut
environments, as all these have factors that can down on costs (Baradello and Salazzaro, 2012), what
positively or negatively impact on the business. For more countries and businesses in Africa?
example, it is the economic environment that will Based on the literature review, it would appear as if
determine the demand and supply of goods and imitations are unavoidable and pioneers have to
services; the type of goods and services, the level of accept that as long as their businesses show signs of
competition and the prices to charge among other profitability, other businesses are bound to imitate
factors. If there is stiff competition perhaps, combining them. While a business might be guided by its vision
imitation and innovation would be ideal, because and mission in its operations, it should incorporate
duplicative imitation might not work. Legally, a the market needs, assess its strengths and weaknesses
company should find out whether imitation is in making decisions of whether to pioneer or imitate.
permissible or not, lest the business finds itself having At the end of it all, managers should understand that
to deal with law suits. As alluded to earlier on, the money comes from the customers and it is the
pace at which technological changes are occurring is customers that determine what should be produced.
very fast making it necessary for businesses to assess Therefore, managers should study the market and
the level and intensity of competition, the number and make decisions that satisfy the market. If managers
size of competitors. It is in this regard that an decide to imitate, they should not do so in a
environmental analysis is key. confrontational way such as using similar
Secondly, it is important to conduct an environmental advertisements, brands and logos of the companies
analysis because some environments are more that they imitate. This would be tantamount to
favorable to pioneering than others. If the environment duplicative imitation or plagiarism which might not
is more conducive for the imitation strategy, then, be healthy for businesses. What should be borne in
managers should adopt the imitation strategy, but if mind is that the owners of the brands would have
more benefits would be gained in pioneering, then, the paid for them and, therefore, their rights should be
pioneering strategy should be embraced. Managers respected. Where possible, consultations should be
should realize that what works in one environment made with holders of patent rights.
might not necessarily work in another environment. Given that no studies were accessed on whether
Thirdly, managers should do a SWOT (strengths, companies should adopt the pioneer or imitation
weaknesses, opportunities and threats) analysis of strategies, further research could be conducted on the
their own businesses. An assessment of the internal impact of either pioneering or imitating on a
environment should focus on the available company’s performance.
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