Monthly Archives: July 2009
How Leading Firms Use Open InnovationMany CEOs see collaboration as key to their success with innovation. They know they cannot achieve their innovation targets using internal resources alone. So they look outside for other organisations to partner with. A good example is Mercedes and Swatch who collaborated to produce the Smart car. When Mercedes wanted to produce an innovative town car they did not choose another automobile manufacturer – they partnered with a fashion watch maker. Each brought dissimilar skills and experiences to the team.Costa Coffee is a chain of coffee shops which is in fierce competition with Starbucks and Cafe Nero in the UK coffee bar market. It has had considerable success by collaborating. Costa develops concessions with key partners. Current concession partners include coffee stores in Abbey National banks, W. H. Smiths and Ottakars book stores and Homebase DIY stores. The concession stores are managed by the Costa … Continue reading
How on earth can companies compete in a global economy where staff costs in India are a tenth of those in the West and where Chinese companies are now looking to outsource their operations to cut costs further? We can not continuously improve our way out of the current challenges, rather we must fundamentally change what we do and how we do it – in short we must innovate. Some people think innovation is the generation of new ideas – but we would refer to this as creativity. Creativity is part of innovation but is not a substitute for it! Being creative and coming up with new ideas is all well and good but if no one puts them into practice then they are worth nothing to a business. For us innovation is the “commercial exploitation of ideas.” It needs to be a planned and proactive process.Innovation is …
Recently, I had the dubious honor to work with a senior executive who just doesn’t get it.Rodney was V.P. of Marketing for a leading manufacturer of networking technology. (Or so we’ll say – substitute the leader, politician, or other important person of your choice.) As such, it is Rodney’s job to create demand for his company’s products. And yet after months of effort, demand had actually decreased, Rodney’s team became alienated, and the company’s performance suffered as a result of his work.Rodney was always quick to point out that the economy was sluggish and therefore the problem wasn’t his marketing but simply that people weren’t going to respond to anything. Also, said Rodney, the Internet team was slow to respond to his needs, holding up his online marketing initiatives. Furthermore, he had made requests of his President for approval on programs but they were denied, …
Now more than ever, companies need great new ideas, great new products and great new businesses. However, innovators often fail to realize just how big the difference is between them. For example: Satellite radio is a fabulous idea, and Sirius is great product, but what a terrible business. Gillette Fusion isn’t a great idea – but is a great product and a great business.In its heyday, Dell computer was a great idea and a great business, but its products weren’t that special.The Holy Grail is ascending the pedestal reserved for the great idea/great product/great business triumvirate. Contemporary triple-players include American Idol and Guitar Hero. We’re also excited about Google’s Chrome Operating System and eager to see how the monetization of cloud computing plays out. Understanding commercial realities at the onset of every innovation project is crucial to delivering those great ideas that become great products and great businesses. …
“Radical Innovation” refers to high risk, high uncertainty projects which hold the potential to both influence the marketplace and bring high returns to firms. It’s a kind of “promised land” of differentiation, growth and wealth for businesses and nations. Radical innovation is different from gradual innovation, in which small, incremental changes are made to activities in order to create more value with less waste. The focus of this article is how firms can realize radical, or breakthrough, innovation, which is the more difficult type to foster.A 2007 McKinsey Global Survey revealed that 70 percent of corporate leaders call innovation one of their top three priorities. They believe that breakthrough (or radical) innovation will have the greatest affect on corporate performance. The report shows that these leaders agree – “innovation is the best strategic decision for sustainable competitive advantage.” Yet these same leaders report that strategies for igniting innovation in their … Continue reading
Why do some nations and geographic regions seem to be hotbeds of creative entrepreneurship and economic growth, while others remain innovation laggards? In his book The Wealth and Poverty of Nations, Harvard professor David Landis writes, “If we learn anything from the history of economic development, it is that culture makes almost all the difference.” National governments the world over are waking up to this truth as they struggle to improve their countries’ global competitiveness and economic prosperity.They now recognize, as The Economist puts it, that innovation is “the single most important ingredient in any modern economy.” But how exactly can a country create the cultural and constitutional conditions for innovation to flourish? In short, how do you build an “innovation nation?”In my travels around the world, I’ve been asked this question many times, in places as diametrically opposite as Sweden and Saudi Arabia, or Moscow and Madrid. Some nations … Continue reading
