Disruption contained: preventing self-inflicted innovation wounds
You’ve got a revolutionary product and a choice of innovation strategies: trying to do everything you do ‘in the spirit of innovation’ or to run an otherwise traditional business, limiting additional risk: are both options misguided?
What about this idea: Pre-emptively examine each of your business processes to determine the ‘impact of your innovation’ in order to discover whether or not that process ‘also needs to be done differently’ to either exploit the benefits or contain the disruption that your innovation might inflict upon you.
Why I thought this video was interesting:
Robert Wolcott, author of a book called ‘Grow from within‘ seems mostly to be aiming his approach at large (rather than startup) corporations, who are either being encouraged to innovate (in order to sustain competitiveness in the face of future commoditisation) or if they are already pursuing innovation in terms of new products, he is advising them to treat their innovation as a requirement for ‘business process analysis’ in order to ‘optimise processes for compatibility with innovative products’.
It’s official and it’s a shock:
Ninety percent of all US corporations are NOT innovators
It is all too easy, in an online world that seems to be drowning us in news about innovation, to build a completely fantastical picture of ‘ubiquitous innovation’ where only the poorest, most under developed parts of the world are not devoting every waking moment to doing everything in the most innovative way possible.
A shocking fact for those of us (yes, me too) that wear ‘innovation coloured spectacles’ is that most organisations may be far less innovative than we’d ever imagine:
(only 9% of 1.5 million US for-profit companies were active product innovators)
I say ‘seems’ in this context, purely because I have gleaned this from what I have seen in the video. I haven’t read his book (which does look worth investigating, judging by the testimonials) nor have I been in contact with him or his consultancy firm.
This subject matter is intriguing to me because it is in the realms of ‘innovation for established organisations’ whereas most books covering innovation tend to be aimed at:
- helping you start a new business
- helping existing startups
- discussing new technologies (mostly nanotech, biotech and clean/green technology)
- covering the impact of social media
- covering the impact of mobile technologies
What really sets this apart from the current mainstream of innovation subject matter is the fact that he also seems to be ‘encouraging big non-innovators to innovate’.
Here’s the details of the book (from a press release):
Corporate Entrepreneurship and Innovation Explored at More than 30 Global Companies Over Six Years of Research
New book by two leading experts on innovation explores some of the surprising new ways that large companies create innovative new businesses.
The book, Grow from Within: Mastering Corporate Entrepreneurship and Innovation reflects six years of research and provides a hands-on guide to finding the right approaches
The authors, Robert C. Wolcott and Michael J. Lippitz, are leading authorities on innovation and corporate entrepreneurship at the Kellogg School of Management at Northwestern University and have worked with scores of large corporations on developing and implementing new business creation capabilities.
Their 2006 article on The Four Models of Corporate Entrepreneurship for Sloan Business Review is still one of the site’s most often downloaded.
“If America is to remain competitive, companies of all types and sizes must create internal entrepreneurial capabilities.
In an increasingly globalized marketplace, powerful competitors can come from anywhere.
Enabling the entrepreneurial capabilities of a company’s people is the most powerful way to survive and thrive in the long run.
Grow From Within outlines how leading companies are doing so,” the authors say.
Starting in 2003, the authors studied more than 30 companies across industry sectors and developed an ongoing dialogue with them about corporate entrepreneurship through the Kellogg Innovation Network (KIN).
Case studies cited in the book range from consumer packaged goods companies like Kraft and Procter & Gamble and manufacturers like Linde and Computime (Hong Kong) to technology powerhouses like Google and Cisco.
The book even explores innovation in government through cases from the U.S.
Department of Defense, such as the transformative launch of stealth technology.
Press release disclaimer
The item to the left of this box is a press release
Issued on behalf of at least one of the main organisations that it mentions, it concerns matters and events which they wish to bring to your attention.
I’m convinced that it’s worthwhile including it at length because it contains material relevant to this story and that if you are interested, you might find these additional details useful
Because I recognise that it’s not common practice elsewhere to include more than a small fragment of a press release in an independently written article, I’d just like to make a point of reminding you to take the declared and implicit interests of the source into account when considering its content
The authors found that a number of companies have generated billions of dollars in new revenues and expected their new business creation performance to continue.
A few findings from Grow from Within include:
- Companies do not lack good ideas.
- Rather, the difficult task is to create an organization and processes that refine ideas, build businesses, and bring the best of them to market.
- Contrary to myth, structure and process are not the enemies of innovation.
- Also contrary to myth, large companies have significant advantages over start-ups when it comes to innovation and building new businesses.
- Innovation should be approached more broadly than inventing new products and services.
- It is really about new business design, incorporating all aspects of how the company does business, what they sell, to whom, how and where.
- The most successful innovation programs focused on one or two innovation objectives and did them well.
- They didn’t try to do everything.
The book outlines 12 different ways companies innovate and fits them into a useful design tool, the Innovation Radar.
While these include new products and services, they also include creating new customer experiences, reaching new customer segments, capturing additional revenue in innovative ways and creating innovative distribution channels or physical presence.
In addition, the authors have found there is no one-size-fits-all approach to building entrepreneurial capabilities within the corporation, but rather four basic models—opportunist, enabler, advocate and producer—around which companies can design new businesses successfully.
Robert C. Wolcott is a faculty member of Entrepreneurship & Innovation at the Kellogg School of Management, Northwestern University.
He is co-founder and executive director of the Kellogg Innovation Network (KIN), an organization of senior executives who collaboratively address challenges in innovation-driven growth and performance, and co-founder of management consultancy, Clareo Partners LLC.
The session in the video was called:
Strategy management practice/strategy and innovation/
Smart Minds, New Ideas, Future Strategies
Held at the Harvard Club, New York
On Tuesday, June 16th 2009
It was hosted by:
The Association of Management Consulting Firms (ACMF)