The Innovator’s Paradox

When’s the best time to implement change?

Before you need to do so.

In a world of accelerating product and technology developments, the way you handle your job today is far different from when you first started out. Business in the 21st century is continuously reinvented and innovated. If you resist change, thriving and surviving may prove elusive.

Companies that focus on innovation not only keep pace, but drive change. Think beyond adaptation; look toward making significant contributions that shape the future.

During the 2008–2009 financial crises, many organizations viewed innovation as a choice. Not so today. If you and your organization fail to innovate, you’re on the path to stagnation and obsolescence.

Today’s competitive advantages will not be tomorrow’s. Can you and your company identify fresh trends and walk away from outdated core competencies, when necessary? Are you actively preparing new products and services?

Organizations adapt only if their people do. This means that everyone — leaders, managers and staff — must acquire an innovation mindset to improve today’s job performance and prepare for future demands.

As former Intel CEO Andy Grove notes in Only the Paranoid Survive: How to Exploit the Crisis Points That Challenge Every Company (Crown Business, 1996):

“It is at such times of fundamental change that the cliché ‘adapt or die’ takes on its true meaning.”

Too Little, Too Late

Unfortunately, many corporations don’t recognize the need to change until it’s too late. Prime examples include Kodak, Blockbuster and the U.S. Postal Service.

When times are good, you can do things differently, without great urgency or desire. When times are bad, you must urgently do things differently, even if you lack the necessary resources. It’s terribly hard to be creative when you’re in crisis.

Whenever start-ups clobber big companies, the writing was almost always on the wall. Everything looked fine — until the day it didn’t. Will your business be ready before that day comes?

Start by asking three question sets proposed by consultant Scott D. Anthony in The Little Black Book of Innovation: How It Works, How to Do It (Harvard Business Review Press, 2011):

1. What do underlying trends suggest about possible future states? What would happen if some of these trends converged into a perfect storm?
2. Where is there a small, but growing, trend? Anything that has doubled in size is a potential disruptor, regardless of its small size today.
3. What can you learn from analogies and metaphors? What similar situations have companies faced in the past? What can you learn from others’ mistakes and history?

An innovative mindset requires a keen eye that can spot even the haziest signals — when there’s still time to develop and create solutions.

Helpful tip: Create a list of three signposts that suggest the need for a dramatic shift in strategy.

Innovation Is a Discipline

Over the last two decades, experts have researched and defined ways to develop innovative organizational solutions. They’ve learned that successful innovators follow a disciplined process that helps them discover opportunities to try something new. “Doing something differently with an impact” is how Scott Anthony defines it.

Innovation is not just about finding a new product or service. You must create solutions to customers’ problems — even the ones that aren’t yet clear or articulated.

Don’t view the innovation process as something mysterious, random or reserved for creative geniuses. Instead, break it down into four distinct phases:

1. Discover opportunities.
2. Organize ideas into plans or pilot projects.
3. Assess, test and learn from ideas.
4. Execute.

Each phase requires you to keep an open mind, learn from mistakes, test your ideas, revise when necessary, and have persistence and patience when awaiting results.

Enemies of Innovation 

Innovation isn’t limited to R&D units, marketing departments or special committees. Everyone should adopt an innovation mindset because ideas can come from any corner of the organization.

Managers sometimes squelch good ideas before they have a chance to turn into new growth opportunities. A strong culture of winning and peer pressure also inhibits people from taking risks. Some managers inadvertently discourage innovation by focusing on numbers, short-term goals and compliance. Incentive programs tend to reward results instead of acknowledging innovative behaviors.

Work with your CEO, department heads and team leaders to avoid becoming trapped in the status quo — a big step toward freeing up creative thinking.

Phase 1: Innovation Starts with the Customer

To innovate, companies focus on their customers and end-users. They devote resources, teams and processes to find out intimate details about customer experiences.

Regrettably, this challenging phase is often glossed over. It isn’t productive to simply survey customers about their needs or wants. Most customers will provide only cursory answers to this question.

Focus groups are often ineffective if you want to discover customers’ frustration points. Participants couch their answers to conform to group dynamics or erroneously assume others are on the same page. First-hand observation of product usage works better when trying to come up with innovation opportunities.

To fully understand what goes on in customers’ minds, ask them what they’re trying to accomplish with your product or service. Management guru Peter Drucker has been known to explain it like this:

“The customer rarely buys what the company thinks it sells him. One reason for this is, of course, that nobody pays for a ‘product.’ What is paid for is satisfaction.”

Ask customers several successive questions to determine how they wish to use your product or service to achieve satisfaction:

• “Why?”
• “Why not?”
• “What if…?”

In this way your assumptions become clearer.

Helpful tip: To develop an innovative mindset, practice discovering opportunities:

1. Identify your target customer.
2. Identify problems the customer is struggling to solve today. For what job is he or she using your product or service?
3. Discover any signals that suggest the customer is dissatisfied with the status quo.

Phase 2: From Idea to Plan

“Everybody has a plan until they get punched in the mouth.” ~ Mike Tyson

Some recently published books on innovation suggest that a strong idea is a good starting point for finding growth opportunities. In truth, your first idea is usually wrong in some meaningful way. Use it, instead, to develop the next idea, until you find what works.

Moving from good idea to growth requires a robust blueprint or full schematic of what your ideas will ultimately yield. Research how other leaders have solved similar problems.

Your idea doesn’t have to be perfect, but it does have to be good enough to deliver better solutions. Your plan also has to be realistic.

• How will you test the idea?
• What resources will you need (partners, customers, time, money)?
• What are possible revenues (short- and long-term)?
• What are the possible threats and barriers (short- and long-term)?
• What assumptions are you making?

Helpful tip: Look for innovation inspiration by searching online. A good place to start is the 20-minute video talks by experts at TED.

Phase 3: Assessing and Testing Ideas

Many people assume that coming up with a winning idea is key. Ideas are relatively easy; what’s hard is actually doing something with them.

You must be willing to accept failure and learn from mistakes. This requires resilience and persistence. Be alert to the signals of a disruptive solution, as opposed to a failure. How can you provide a simpler, more convenient or more affordable answer to your customers’ frustration points?

Tests are the best ways to learn about existing critical assumptions and to identify new ones. As valuable as research is, you’ll know whether your idea works only after actual implementation.

Thomas Edison’s famous quotation holds true: “Genius is 1 percent inspiration and 99 percent perspiration.” If you’re not sweating, you’re not innovating.

Helpful tip from Scott Anthony:

“How can you quickly estimate an idea’s financial potential? Multiply population, penetration, price and purchase frequency to gain quick insight into an idea’s potential.” 

Phase 4: Putting Plans to Work

After completing the testing, learning and revising phases, put your plans to work. Start with a pilot project to minimize resources and maximize potential.

You’ll need to manage resources to improve potential. Determine what you’ll do yourself and what you’ll delegate. Involve partners where feasible.

If the project is part of a larger organizational mandate, prepare a presentation on your results for involved executives. Your presentation style and contents will influence your project’s acceptance or rejection, so be meticulous. You may love your baby, but how will you convince others to adopt it? Seek help from presentation experts, if necessary, to ensure success.

The belief that a good idea will win the hearts (and money) of the consumer is false. An ideal product or service is tempered by people’s willingness to try new things, culture, habits and other events. The number of failed innovative products is testimony.

The most successful innovations balance what experts and consumers value (often two different perspectives). Remember: Success is never guaranteed, no matter how hard you push or market your innovation.

Acquiring Innovative Qualities

Business professors Jeff Dyer, Hal Gregersen and Clayton Christensen decoded what they call The Innovator’s DNA in their book of the same name (Harvard Business Review Press, 2011).

Successful innovators master associational thinking. They make connections among seemingly unconnected inputs.

Here are four time-tested approaches for gathering stimuli and making connections:

1. Questioning: An innovative mind makes a lot of “what if?” inquiries.
2. Networking: Innovators interact with people from diverse backgrounds to access new perspectives.
3. Observing: Innovators are always looking at the world with business radar to detect surprising solutions.
4. Experimenting: Innovators try new things, in new places, to expose themselves to new experiences.

You can develop these qualities by working with a professional coach. The investment is well worth the reward: your ability to influence the future, your career and your personal-development capabilities.