Finding Innovation

Are you looking for innovation on dusty old shelves?

Where do the ideas for disruptive business models come from? Why do we need radical and incremental innovation? Don’t fight it, give it a try. Here is how.

At the moment, it feels like three quarters of my work day are subject to radical change. We’ve been talking about key drivers like digitization, IoT, blockchain, and artificial intelligence here in this forum for some time now.

But somehow, the impacts of these developments have crept into our daily work – and in such a scattered way that it seems hard to grasp. Just the other day, I had a lengthy discussion about this with a colleague:

  • Why do we perceive the current change as such a strong upheaval?
  • Is it just how natural change feels when you’re in the midst of it?
  • Or is the ongoing change truly more intense – leading to a more radically new industrial age?

Embrace it, it’s here to stay

Countless start-ups in established sectors, an excessive increase in projects which everyone tries to tame with agile methods, creativity techniques like "design thinking" on every corner, …

The sum of all these symptoms leads me to believe that it’s not just a coincidental accumulation of new methods that will soon be forgotten about. No, I have a strong sense that the pressure driving new and faster solutions outside of long-established business areas is here to stay.

It’s sustainable and very real. It won’t go away! The video „Overcome Legacy – Embrace Disruption“ demonstrates it quite well – using the example of retail. Watch it here:

The pressure is on: ideas please

For me, this day-to-day experience slowly condenses these developments into a fact: a large part of established business areas that generate most of our profits today, might not exist tomorrow. Sooner or later, they will disappear. For innovation, the pressure has never been higher and the weight of expectation has reached an unprecedented scale. The great uncertainty as to when the next business model will be disrupted is strongly fueling this.

Fighting fire with fire seems the best cure against this uncertainty – becoming a disruptor yourself. 

But where does innovation with such power to drastically change the rules of the game in established fields come from? I mean truly radical innovation – the one that extends beyond mere evolutionary development? Innovations that don’t just make existing problems “a bit better”, but solve them in an entirely different, a radical, way.

Do we just get these ideas from the store room? Have we stored them away on the famous “later, when there is time for it” shelf? What is it that really gets a business to develop new markets and new services with entirely new business models?

Ideal world = two worlds?

In an interview, Jean-Philippe Hagmann, co-founder of INNOPUNK explained it as follows: Companies need two organizations. One takes care of daily business, its efficient operation, and required, incremental innovations. The other is a smaller group that only needs a few people – and they’re the ones to cast the net wide into the future, develop new things, test new concepts, and come up with radical innovations.

An interesting approach indeed. We all know too well how daily business devours creativity. And as long as business is good, there is no pressure to escape the rat race.

But isn’t it usually in day-to-day business where the critical discussions start? And would such an organizational separation mean that teams controlling daily business are less innovative? Less cool even? Basically, just there to generate cash to fund all the new, exciting stuff? Would it drive a two-tier society?

When posing these questions, at the latest, we come across all those examples of highly innovative yet economically unsuccessful concepts. We all know the Segway case, of course. Still, Hagman has a point: a protected space can indeed provide the grounds – though not the only saving – for developing radical ideas and successful innovations. But it needs a systematic approach, too.

Free space and methods teaming-up

Ground-breaking innovation can’t simply emerge from just switching off the system and providing full breathing room. You need a method. And there are plenty to choose from these days. Design thinking (I’m a fan as of late!), SCRUM, lean startup, or SPRINT. My fellow blogger Daniel reported about a successful trial on the last one – SPRINT – in his post “Self-test on innovation tools”.

I think one of the key success factors of these methods is not to base ideas on an expected result. Trial-and-error is not only allowed, it forms a crucial and considerable part of the whole approach. INNOPUNK explains these methods very well in their blog post “SCRUM, lean startup, design thinking, SPRINT in a nutshell”.

How companies should weigh the relevance of radical innovation versus incremental innovation is certainly an individual matter and requires case-by-case assessment. Many factors and arguments claim support for the one or the other side: company cultures, visions, strategies, applicable market environments, and last but not least, shareholders’ vision.

But if you’re truly looking for radical innovation, don’t just go into the store room and check that dusty old “ideas for later” shelf. Try out the combination of free space and new methods – I have come to believe in it.

How to bring it all together again in the end – the radically innovative ideas and methods, and the running operation and core business that are shaping the success of the businesses for a long time to come – is quite another, thrilling question, too.

I shall pin it – and will plan to further scrutinize that in my next post. Stay tuned ;). I look forward to your views and comments – on XING, or LinkedIn.

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