Wednesday, July 31, 2019

Search for Disruptive Innovation to Build Long Term Business Advantages

Managing disruptive innovation demands insightful understanding, patience, persistence, and courage, among other things.

Innovation is the core activity of human evolution to changing the environment for making collective progress. In the business setting, innovation is what differentiates the leader from followers. Often, innovation is disruptive and risky. It’s no surprise to know that many organizations avoid risks, the immediate pressure from shareholders or “keeping the lights on” bottom line mentality is making them look inward to make incremental improvement by optimizing what they know. But from the long term perspective, the strategic concern is that they perhaps do not invest enough to craft a great innovation strategy with a harmonized vision about building innovation competency. The challenge is about how to proactively search for disruptive or breakthrough innovation to build long term business advantages?

To disrupt, you must hear the whispers of customers, business contexts, inner worlds, or outside worlds: The disruptive innovation often evolves exploring the new market territories or attracting new customers by designing and delivering new products/services or new business models. Thus, one of the critical issues is to focus on end-user need gaps even by looking beyond your current products/services categories. People should be the center of innovation. One of the tests for whether it’s a disruptive innovation or not is about how significant of the value proposition it brings to the company, how impactful the problem it helps to solve, as well as how it makes any difference to dimensions that is valued by customers. Therefore, to disrupt, it’s important to practice deep listening skills, engage and empower customers for innovating, to gain insight and empathy. To implement innovation successfully, it’s also critical to build a strong team by maintaining their motivation and focus. Collectively, they have a good understanding and appreciation of the business processes, fully aware of the organizational structure and who is responsible for what - both infrastructure and application for truly delivering innovative products or services.

It’s also important to have the objective attitude to understand innovation cycles thoroughly: Many disruptive opportunities are brought to life with new thinking on how to monetize them. A disruptive innovation is a breakthrough in the existing solutions, something that has a potential to disruptively challenge all existing solution. At the early stage of the explorement, these innovations can be defined as offering an initially lower performance while at the same time bringing some new attributes to the market. Thus, it requires fresh thinking on how to monetize them. Although there is no one size fits all scenario, they almost always deliver some combination of the benefits of affordability, convenience, and ease-of-use compared to higher-performance existing solutions. To improve the innovation success rate, study success stories across the industrial sectors or global territories about disruptive innovation or gain “lessons learned” by avoiding others’ mistakes. After ideation, companies need to filter, prototype and validate their ideas, and ultimately deliver innovative solutions. Also be aware of innovation cycle, A disruptive product over time weakens as it moves towards the eventual commodity status. So companies have to keep searching for new opportunities to disrupt, rather than being disrupted.

Leverage ecosystem viewpoint and create a road-map for disruptive innovation: Digital dynamic enables companies to leverage their various environments or ecosystems, to chase innovation and accelerate performance. Variety, complexity, diversification, and collaboration are the very characteristics of the digital ecosystem. It’s great to create a roadmap for disruptive innovation because they are macro trends and patterns that give clues and there are unmet needs. Being digital fluent with ecosystem perspective aids the management in understanding what’s relevant and what’s not. Try to digitally connect key assets or context to the resource-rich innovation hubs and cluster across enterprise ecosystems. In doing so, you can create a shared context for learning and co-creating. That, in turn, will further fuel broader collaboration in generating fresh ideas. How successful that the organization can manage “disruptive ideas” and product innovative products or services depends on how those ideas are recognized, filtered and dealt with. Innovation leaders should fill their innovation toolbox with tailored frameworks, processes, technologies, and various problem-solving tools, as well as the metrics to evaluate innovation performance. A structural innovation management requires laying out different thought processes, structures, or cultures for bringing ideas into full fruity.

Managing disruptive innovation demands insightful understanding, patience, persistence, and courage, among other things. It’s important to set a good innovation agendas and start new conversations that galvanize inspiration and gain traction on a powerful theme of business renewal and growth.


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