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Innovation
As Christensen made clear in his classic book, the Innovator's Dilemma, innovation offers some mind-twisting challenges to business leaders. Here are three:
- Do you consolidate your processes to drive quality and efficiency, but at the risk of making it harder to change, OR retain fluidity and risk quality and high costs?
- Do you bring inventive new technological advances to the market, but risk being irrelevant or at least undervalued by the market, OR study customers to identify unaddressed needs or frustrations but then risk discovering that you can't make a profit satisfying them?
- Do you develop innovations in-house, meaning huge investment in R&D, OR do you acquire technologies but then risk integration failures and culture clashes?
Then there are other questions which, though not actually dilemmas, are still hard questions, especially when you are up close to the issue:
- How do we turn a good idea into a robust, practical reality?
- How do we avoid having all our eggs in one basket without the risk of diversifying away all the potential reward?
- How do we gain agreement on which of the many good ideas to take forward?
- How do we actually assess risk-reward, especially when data is hard to get (or, more dangerous and seductive, plentiful but of low quality).
Clearly there's a lot more to innovation than 'thinking outside the box' or coming up with as many uses for a brick as possible in 10 minutes!
Here are three ideas to consider as a start:
- Separate out strategic questions (what kind of business are we) from tactical questions (how do we implement this), and to decide on your strategy first. The upper list of questions above are hard to resolve intelligently without strategic clarity. The danger with pursuing the second list before strategy is confirmed is that it can just make you more efficient at going in the wrong direction.
- Recognise that innovation doesn't just mean technological innovation. A great business innovation can be technologically trivial, for example being first to offer a simple flat rate tariff for all your customers mobile, landline, data and TV services (delivering simplicity and predicability in a notoriously stress-inducing sector). Or it could be a mobile phone that is just a phone, which uses less technology to produce a better experience for people who hate fiddly gadgets. The key is an innovative value proposition in the perception of the customer or client.
- According to Harper Lee's Atticus in "To Kill a Mockingbird", you don't really understand a person until you have walked a mile in their shoes. Think about what it's like to experience your products or services from the customer's point of view. What would you then find compelling? What frustrations would you be grateful to have removed? For more on this, including a step-by-step process, read this article on Customer Experience.
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