Innovate or Die

Or, put a little less dramatically:

The ability to innovate is the only possible sustainable competitive advantage. It's not location and it's not the cost of doing business.

From Sandy Baruah, included in his 5 "new realities" for small businesses. See the following link for more information: http://voices.washingtonpost.com/small-business/2008/08/baruah_outlines_five_new_reali.html

--Ben

Update: I wanted to expand on this post, as I think there's really something critical in what Baruah is saying. When I talk to entreprenuers I'm often reminded that what wins the game isn't:

• Being first (you'll have competitors soon enough, and the web is a big place - chances are, you aren't first anyway)
• Having the most money (Having lots of money can actually be a bad thing)
• Having a patent (or more likely, spending valuable time and money trying to get a patent)
• Being the cheapest (you won't be for long)

What's left? Innovation. And not just software innovation - but marketing, customer service, packaging, and pretty much every other part of your business. Innovate, or stop playing the game.