Innovation and the theory of constraints
Remember the famous classic “Around the world in 80 days”. I remember reading that book in my early teens mainly because it caught my attention with the title and the audacious thought. It also challenged all my assumptions about how big our world really was and what it takes to go all around it. We need to come up with similar propositions that catch attention for all our company goals as well.
Think about it. The biggest stumbling block to innovation is people and their everyday struggle to think differently and without boundaries. This is especially true for large organisations since large organisation have well defined boundaries and processes. So it is easier and more tempting to stick to that and not rock the boat. Unfortunately that does not help innovation at all. So what do I do about it? Start innovation campaigns and challenge all basic thinking and assumptions. I refer to this as the theory of constraints. Innovation flourishes well in these kind of environments.
And why is this important? Well – we all know about the familiar story of General Motors who just did not think different in terms of hybrid cars and kept believing that bigger cars is the only way to go. Or what about Blockbuster who just did not believe in Netflix and other online competition until it was too late. Netflix was launched in 1999 with the online concept. Blockbuster started online rental from 2004. By Oct 2007, Netflix had 16 Million unique visitors compared to 4 Million to Blockbuster Online (source: Compete.com data comparing unique visitors between Jan 2005 to Oct 2007). Look around and you will find plenty of similar stories.
Now reflect on this. I am sure the senior management staff at GM or Blockbuster should had got information about the growing trends in their respective market. But why did they not react before it is too late? The only reason I can think of is their inability to think outside what was their comfort zones. In short, they were scared of experimenting and going along a different path. Now is there a lesson here for your business?
The answer is definitely yes. Think about it. What is your best selling product? Now think – how do I make sure that I keep it this way? The answer is only one – innovate, experiment, lead. Do not be scared of making mistakes or going along non-traditional paths. If you find that your competitor has got a competitive advantage - learn, reflect and experiment. But do not ignore or wish it away. And what about products where you are not the market leader? More the reason to innovate with that. Target areas where your competitor is weak or where there is ann opportunity and innovate heavily in those areas.
One final word of caution: Never become so busy with your everyday routine and fire fighting that you ignore innovation.
Act Now.
Think about it. The biggest stumbling block to innovation is people and their everyday struggle to think differently and without boundaries. This is especially true for large organisations since large organisation have well defined boundaries and processes. So it is easier and more tempting to stick to that and not rock the boat. Unfortunately that does not help innovation at all. So what do I do about it? Start innovation campaigns and challenge all basic thinking and assumptions. I refer to this as the theory of constraints. Innovation flourishes well in these kind of environments.
And why is this important? Well – we all know about the familiar story of General Motors who just did not think different in terms of hybrid cars and kept believing that bigger cars is the only way to go. Or what about Blockbuster who just did not believe in Netflix and other online competition until it was too late. Netflix was launched in 1999 with the online concept. Blockbuster started online rental from 2004. By Oct 2007, Netflix had 16 Million unique visitors compared to 4 Million to Blockbuster Online (source: Compete.com data comparing unique visitors between Jan 2005 to Oct 2007). Look around and you will find plenty of similar stories.
Now reflect on this. I am sure the senior management staff at GM or Blockbuster should had got information about the growing trends in their respective market. But why did they not react before it is too late? The only reason I can think of is their inability to think outside what was their comfort zones. In short, they were scared of experimenting and going along a different path. Now is there a lesson here for your business?
The answer is definitely yes. Think about it. What is your best selling product? Now think – how do I make sure that I keep it this way? The answer is only one – innovate, experiment, lead. Do not be scared of making mistakes or going along non-traditional paths. If you find that your competitor has got a competitive advantage - learn, reflect and experiment. But do not ignore or wish it away. And what about products where you are not the market leader? More the reason to innovate with that. Target areas where your competitor is weak or where there is ann opportunity and innovate heavily in those areas.
One final word of caution: Never become so busy with your everyday routine and fire fighting that you ignore innovation.
Act Now.
Madhu
(http://innovatetogether.blogspot.com)
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