Go back into the history pages of most businesses, large or small, and you will find an individual or small group of like-minded people who, despite seemingly insurmountable challenges, deeply believed they could produce a better product or service than what was available in the market or they had invented a new product or service that filled an unmet, possibly even unrealized, need. While there may have been many motivators for starting a business such as personal financial gain, being independent, limited employment opportunities, or the joy of winning, ultimately they had to provide something of value that others were willing to pay for.
What was the source of their inspiration for their first product or service innovation? It may have been personally experiencing a poor quality product or an unsatisfying service. Maybe it was connecting their personal abilities with a market opportunity. It might have been being in the right place with the right idea. More than likely their first offering was a serendipitous event, an opportunity that was come upon or found by accident, not the result of a methodical search. Turn a couple more pages forward in the company’s history book and now the company is successfully producing, marketing, selling its first offerings but sales are flattening. Maybe it is margins thinning due to competition, market saturation due to limited new market access, or the initial offering being displaced by the “next big thing.” How did the company respond? Was it more like the initial serendipitous response that was the genesis of the company in the first place? Was it trial by error, ad-hoc and unstructured, or did the company recognize that the innovation process is a vital business process to be intentionally invested in, developed, and managed? The answer to that question probably comes in the next few pages; are they blank and the story has ended, or does the story continue with a series or new offerings, each one better than the previous? Even if the story continues, is it a slow read or a fast-paced engrossing story, i.e. are the new offerings generally incremental or breakthrough in nature?
Often for small companies if the story continues, the development of new products and services does not happen with such regularity that it is viewed as a process to be strategically developed. Strategic innovation is a systems-based approach focused on generating breakthrough or disruptive innovations through an intentional, repeatable process that creates significant difference in the value delivered to customers and partners.
Regardless if a company chooses to simply embed a strategic innovation mindset in their company culture or create a formal documented business process, the mindset is identical and the elements are often the same. First and foremost it must be a viewed as a strategic process to be developed and managed, regardless of how often it is engaged. The cost of developing new products and services is too significant and all cash-outflow oriented to not be maximized for success and productivity.
Repeatedly evidence shows that successful innovators are not necessarily any smarter than everyone else, they are just better connected. They have great external focus and systematically build networks of customers, experts, capital and partners. They use these networks to search for market opportunities and leverage access to the necessary resources to execute. They proactively develop “top-down” industry foresight to see emerging trends ahead of the rest before the need to react to slumping markets. They systematically develop a “bottoms-up” perspective to understand the articulated and unarticulated needs of existing and potential customers.
Armed with this holistic view of their markets and the connections to realize success, they have also developed a deep understanding of their core technologies and competencies. Successful innovators do not limit themselves by their existing markets and end products or services. They seek to build bridges to new existing markets based on core competencies or create new markets all together where competition does not yet exist because they better understand their technologies, skill sets, intellectual property, strategic relationships, and sense of timing.
But all of this external perspective and internal understanding can be all for not without the organizational readiness to act on new ideas and strategies and the disciplined implementation to successfully manage the operational, political, cultural and financial demands that will be encountered. Investment in the organizational infrastructure is imperative if there is to be a pipeline of innovations.
Sustaining competitiveness requires moving beyond serendipitous innovation. Once an organization begins to develop and institutionalize a cultural mindset and businesses processes that support repeatable sustainable innovation, then future readers of the company’s history may need to be speed readers just to keep up with the pace at which the company’s story progresses.
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