How Do We Know When Innovation Is Needed?
What does it say that we need to change? What tells us to leave things as they are?
Sometimes the need for innovation – whether a process, a service, a product, or something else – is obvious. Maybe sales or profits have decreased, important people have left, or market share has dropped … whatever it is, the need to innovate and do things is inevitable. In change management language, it’s a “burning platform“: moments when change is needed (or should be!).
In such a case, radical innovation – significant and dramatic incremental change – can be a normal, adaptable response, especially if it is a response to what Christensen and others call “destructive innovation” – an innovation that opens up new markets or creates a new product. Category.
However, sometimes the signal is much smoother or completely lost. How do we know in a situation like this that we need to be innovative?
In this 2015 book, Turn Two, Irish-born management guru Charles Handy addresses this situation. Starting with his career, Handy talked about how he would – to the point where his wife was so helpless – put off her job whenever things seemed to be on such rock-solid foundations:
”After ten years with Shell, I had reached the small country manager stage, the first step to greater things, when I decided that the life of an oil executive was not for me, that I would rather teach managers than be one. The old saying ‘if you can’t do it, teach it’ probably applied, if I am honest. To Shell’s surprise, and even perhaps disappointment, I turned down the posting and resigned. After two years of readjusting and the retraining I joined the London Business School: six years later I reached the exalted rank of a full professor with my first book published and the holy grail of tenure (guaranteed employment until retirement) granted, only to decide that it was not what I wanted to spend my life doing. That was to be a fulltime writer. It took four years in one more job to build up the courage to cut that umbilical cord that ties one to the womb of an organization. Only then did I feel that I had come into my own. Just in time, too, or I would have ended up in Davy’s Bar. (Handy, 2015, pp. 19–20)”
By Davy’s Handy Bar is a dead space where we – both people and organizations – accidentally can’t change course until it’s too late. Handy explains it like this …
”I have often, down the years, told my story of the road to Davy’s Bar, and its imagery, along with its implications, still haunts me. This is the story as it happened then, for Davy’s Bar is no longer there: I was driving through the Wicklow Mountains, the bare but beautiful hills outside Dublin when I lost my way. I saw a man walking his dog so I stopped beside him and asked if he could point me on the way to Avoca, where I was heading. ‘Surely,’ he said, ‘and it’s dead easy. You go straight ahead up this hill then down again for a mile or so until you get to a stream with a bridge over it; on the other side of it you’ll see Davy’s Bar; you can’t miss it, it is very bright red. Have you got that now?’ ‘I think so,’ I said. ‘Straight up, then down, until I come to Davy’s Bar.’ ‘Great; well, half a mile before you get there, turn right up the hill and that will take you to Avoca.’
I had thanked him and driven off before I realized the strange Irish logic of his directions. But its message stuck with me until I started talking about the challenge of the Second Curve, that turn to the right up the hill which you will often have passed without knowing it was where you should have gone. I have met too many organizations (and, indeed, individuals) parked in the equivalent of Davy’s Bar, having realized, too late, that they have missed the turn to the future and can only look back regretfully and drown their sadness with a mournful drink or two, while they reminisce about the good times and what might have been. (Handy, 2015, pp. 20–1)”
To illustrate the change in direction needed not to end up at Davy’s Bar, Handy uses the metaphor of a “second turn,” a new and different path, or any other path we can pre-select or initiate the current path of extinction.
This includes the realization that things are still going well for our current journey and that there is no clear “burning ground” for change. Handy also realizes that the first time we change direction it can be difficult and the business can decline. Only after we have crossed this second curve can we say with certainty that the change is justified.
At some level, this may seem counterintuitive: if things are going well, why change? This, of course, is a very sensible question that is often ignored – especially by high-paying consultants who created the industry to tell managers and executives that constant change is both desirable and necessary!
Assuming that even if things are going well, we recognize that change is necessary, an initial and reasonably rational answer may make only minor changes and adjustments. This can be called incremental innovation – basically doing the same thing, just constantly trying to get better.
Take a bicycle, for example. Wikipedia helps us with this: “Bicycles have been continuously adapted and refined since their introduction. This innovation continues with the emergence of modern materials and computer-aided designs, enabling distribution of special bicycle types ”(added emphasis).
We can imagine that time travelers from the early days of cycling could come up with a modern version that might wow them with some new ventilation system for propulsion and brakes or a lightweight carbon fiber construction – but they’ll still recognize it. like a bike If you are a bicycle lover, you will be scratching your head too and wondering why.
Perhaps this is because bicycles only work relatively cheaply and efficiently, and radical innovations are neither necessary nor expensive, and equally important, that they cannot better meet the needs of cyclists.
This additional type of innovation only works when there are no horizontal competitors and if the main product is good enough. Also, the question of organizational context and relevance is very important. Several years ago I worked with the executive team of a large pharmaceutical company whose top priority was an innovation. While things are going well objectively, their instincts as a leadership team tell them they have to do something – they have to jump into corner two. But that’s where the problem starts.
Perhaps not surprisingly, his first response was to call in innovation experts from world-class consultants who could advise him on what to do.
Despite decades of experience, the consultant shows no real understanding of the company, industry, or context: even though it is patented, there are no horizontal innovators on the horizon (it does happen), the product is already very effective and has many successful applications. Industry means strict process restrictions like FDA approval for devices, etc.
Hence, the consultant’s prescription for radical and only radical innovation is utterly imprecise for the organization. He also missed the critical point that incremental innovation is a viable answer and can often lead to significant change because all these little innovations complement something much more important.
In this sense, incremental innovation can almost function as a form of brainless organization known as “Chinese Whisper,” “Hearing,” or “Telephone,” where a simple greeting can change quite drastically because it is thin (and sometimes) unlike. it is thin) is changed through several iterations.
Of course, there is no guarantee that the same incremental changes will be useful or even necessary. You can move something to perfection without realizing that better alternatives have replaced it. Think of the advancement from videocassettes to DVDs and now to streaming services: videocassettes are long gone and sales of DVDs – although still strong worldwide – have plummeted as technology has almost been replaced by streaming and online services. The only sensible question at this point is how long before the streaming service itself is replaced with a better one?
How do we do this? How do we know we know when to innovate and when to move to second turn cell phones?
While this is not an easy fix, steps can be taken to remove the answer to this question …
Pay close attention to what is happening outside your company, be it with competitors, regulators, markets, consumers, etc. It can also be very educational and inspiring to see what is happening in other countries or markets (especially those that are usually considered leaders).
Listen to your people
The association with the innovation concept of “heroic” leadership is often seen as a top-down phenomenon. However, it should and should not be seen as such. Engage your employees and see what ideas they have for change and improvement … you’ll be surprised!
Listen to your customers
Customers not only use or consume your product or service, but they also make an implicit decision to communicate with you and your offer to outperform your competitors. Asking why they want to make this choice and how they use your product/service (not how you think they use your product/service!) Can be enlightening!
At the heart of each of these three approaches is a simple but very challenging concept: communication. To understand what is going on around us and respond effectively, we need to communicate and we need to communicate effectively, especially through listening. We never know what’s on the other person’s mind, but through effective communication and strong listening skills, we can take some positive steps forward.
Regardless of whether the need for innovation is obvious or more subtle, this first step is sometimes difficult. Using the second curve metaphor, mobile provides us with useful clues as to how we can consider, understand, and react to the need for innovation and change before the need becomes urgent.