No Innovation, No Business

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FULL TRANSCRIPT

The marketplace is moving at a staggering rate, digital disruption is everywhere. Your business model is under duress regardless of your industry. Business models used to fail every ten to twenty years now it’s every three to four years; sometimes less. Recently Spotify disrupted iTunes, the iconic disruptor of the music industry. “No innovation no business!”

To move fast enough organisations and their leadership have to be inherently agile, encouraging innovation to be in their DNA. Only in agility and innovation is there the likelihood of sustainability. If you don’t innovate, you die. Look at Nokia, absolute global dominance gone in less than a decade. They ignored the smartphone revolution and became irrelevant very quickly. Their response was to defend the status quo. This is a very natural reaction. Defend what you know, but now we have to embrace what will kill us.

The scale and speed of the digital revolution means we are all being disrupted, continuously; so innovation, idea generation and adoption has to become part of our DNA as an organisation. Whereas we used to be disrupted at the edges of our competence, now we can be disrupted at the very core of our organisation. Take for example, Taxis by Uber an organisation that has no cars, and hotels by Airbnb who own no real estate.

If we are in danger of being disrupted at the core, then our innovative focus also has to be at the core. The idea of a meritocracy where the best ideas win, regardless of their origin is the counter to high levels of disruption.

Take Linex, the open source software company RedHat , for example. Their structures and lines of reporting, if you can call them that, are much more like an organic eco-system, than a traditional mechanistic hierarchy. In that environment a meritocracy seems to work, and they are known for innovation and agility.

Innovation is much more than generating ideas internally, it’s more about creating a culture where ideas can be adopted regardless if their origins.

We have to get over the pride of “it wasn’t invented here”. Fast adoption of ideas and innovation from outside an organisation will ensure more consistent growth. As an organisation builds the ability to recognise innovation, and adopt it, it’s chances of not only surviving, but thriving become enhanced. That capability is based on a culture that is open, full of trust and yet willing to challenge the status quo.

Having a ‘future memory’ is an odd concept. If we do scenario planning, spend some time thinking about the future, and considering blue sky opportunities, we are much more likely to recognise innovation and opportunity when we see it. If we haven’t imagined and explored the future, we may not see the opportunities for what they are. Creating future memories gives our brains a framework and a scenario to plug in possible innovations when we bump into them. This enhances our ability to innovate, adapt and thrive in a fast paced marketplace.