Harvard’s Cynthia Montgomery challenged business leaders in Toronto last week to imagine that their organization was no longer in business. She dared the audience to reflect on who would miss it, and exactly what would be missed. According to Montgomery, that’s the real essence of the business and the focal point for strategy and innovation. This is a cool idea – what a great way to eliminate the noise.
Is your business headed for the sick bay?
Surely many corporations are sick or mortally wounded, whether they know it or not, in part due to the disruptive forces we’re all familiar with:
- Massive global demographic shifts – changing age dynamics, the rise of the middle class, and other demographic factors are reshaping the consumer profile while the “net” generation is impacting society in a multitude of ways (consider Tapscott’s “Grown Up Digital”)
- Radical technological transformation – including these examples:
- “Things” are de-materializing into software, including keys, passports, movies, books, currency (as are services such as education and health care)
- Big data is becoming a factor in many industries, as technologies strive to conquer the sheer magnitude and also deliver value from the data
- Processing power and speed makes formerly unsolvable problems seem trivial
- Many billions of devices are connecting to the Internet (“the Internet of everything”)
- Technology is enabling new business models and therefore new competitors
- The blurring of industry lines – e.g. grocery stores are also banks.
I’m sure you could add another 20, if not 50, bullets to this list. These dynamics are changing the competitive landscape in every industry. According to research, even businesses operating at the top of their market are subject to a stall point.
What’s the Rx?
So what’s to be done? A recent HBR article tells us “Management knows it and so does Wall Street: The year-to-year viability of a company depends on its ability to innovate.” The article offers a handy “innovation ambition matrix” to help companies structure their initiatives more strategically.
In our client base, we see a lot of innovation around the customer experience, followed closely by employee engagement and radical improvements in speed.
As we evolve to the Experience Economy, people have come to expect more than just a product and are willing pay for an experience. This applies in a B2B as well as a B2C context. We are using design thinking principles to co-innovate with our customers and marry technology with creativity to generate competitive advantage.
Similarly, attracting the best talent is crucial for an organization, and keeping talented employees fully engaged and inspired is foundational. Tools that enable mobility, personalized work experiences and collaboration across work groups are top priorities.
As for speed, immediacy has become the norm. Businesses need to get new products and services to market much faster than ever before. As the saying goes, managing a department using spreadsheets is like trying to cross the highway with information from 5 minutes ago. We need both real-time AND predictive information to manage the inherent complexity of business today.
Don’t smother the innovation
New ventures are often stifled through well-intentioned efforts to prove ROI. In a recent post, I summarized Roger Martin’s talk at the WCIT 2012 conference. His opinion is that decision-makers have become too scientific, and he suggested that the key to success in the “century of innovation” is to combine the best of analytical thinking with the best of intuitive thinking.
An apple a day
If we view innovation as a journey, not an event, we realize it’s something that has to be practiced every day through large and small initiatives. It takes a daily injection to keep a business healthy and vibrant.