To thrive in 2014 the name of the business game is innovation. But that is a business game that requires more than a new marketing label or adding a new feature to an old product. It requires creating new things and doing things differently.
Finding new things can be difficult if not impossible because it is not predictable, tangible or certain but it is a requirement to be a market leader. It is also extremely difficult to do using the same mental models that framed the ways and things you’ve always produced and done for the same customers year after year.
New things come from innovation and innovation is everywhere these days. The demand for innovation has 6 out of 10 CEOs making it a priority focus or one of their priorities according to a survey of PWC. So one may wonder what this intangible thing is called innovation that seems so necessary for an organization to thrive in 2014.
Let’s see how others have defined innovation:
- An innovation is something original, new, and important – in whatever field – that breaks in to (or obtains a foothold in) a market or society.
- It’s not the same as invention, although folks often confuse the two. Invention is a unique discovery or finding; innovation is introducing something new.
- Innovation can be an application of someone else’s invention in a new and practical way.
- In Innovators Don’t See Different Things – They See Things Differently, Steve Tobak writes about what Malcolm Gladwell calls the Creation Myth: which is an innovator may not be the guy who comes up with the idea but the guy who turns that idea into something people can use.
So the collective meaning of innovation can be summed up as: something new, original, useful and meaningful enough that it transforms the markets behavior from one state to another. Read it again and ask yourself who is really bringing innovation that changes the markets behavior.
Many organizations say they have or are about to release innovative products as if just saying the word makes it true. Consider nearly half of the S&P 500 used the word “innovation” in their Q3 conference calls. Shane Snow said it best “If you go around telling people you’re humble, the opposite is true.”Humble” is a descriptor that’s bestowed not seized. The same is true with “innovation.”
Innovation Doesn’t Follow It Leads
In a connected marketplace of consumers with growing influence innovation is the magnet of attraction that fuels the influence. Entire markets have been changed by Apple’s products, Google’s search engine capabilities, Facebook’s network effects and many others who have introduced disruptive innovations.
Innovation is the fuel of the 21st century. Innovation provides the value stakeholders and stockholders seek. Stakeholders get enormous value out of using innovation while stockholders gain economic value from massive consumption of innovation. Just how much value? Instagram’s entire company was only 12 employees creating value for over 150 million users when Facebook bought them for a billion dollars.
So how can your company create innovation?
Most organizations create ”innovation task force,” to help them seize the future. The fact that they need an internal group with the name “innovation” means it’s not going to work. Internal groups waste too much time brainstorming old ideas that fit into the same old mental models of the existing organization or industry being served. Rarely does anything new or innovative come from internal committee’s or “innovation task forces”.
There are three primary innovation structures used in corporations today: skunk works, intrapreneur programs, and innovation labs. History has shown that none of them work for disruptive, new product development.
There is a new model emerging aimed at helping businesses jump-start the innovation discovery process through a creative approach involving internal and external resources.
We’ll be discussing that process in future post. In the meantime step away from seeking it and it may just come to you.