We seem to be facing a major crossing-over point in innovation. We can either switch tracks and allow innovation to go on the slower line that continues to stop at all stations, picking up and dropping off, steadily working towards its final goal of “incremental delivery” or, we can decide to keep innovation on the fast track, picking up momentum because we need to treat innovation as ‘core’, essential and needed, to be delivering the growth engine our organizations are requiring today.
Let’s face it, innovation isn’t working successfully for many companies for a variety of reasons. We are faced today with a changing market. The customer is demanding and their expectations are changing, industry lines are blurring, there are disruptive forces constantly at work 24×7 and even the constant steady drip of new business models are simply not working as well as they should be, so as to gain that elusive growth.
Some speak of VUCA used is an acronym to describe or reflect the volatility, uncertainty, complexity, and ambiguity of general conditions and situations we all seem to have become caught up in.
Yet these are all symptoms of a larger problem that innovation is simply not addressing and this is why this growing dissatisfaction on the delivery of innovation solutions is occurring. We are not recognizing the changes occurring but more importantly the opportunities that can be grasped by thinking in different ways. We have many of the solutions right in front of us if we care to look, to understand them and make all the necessary connections and ready ourselves for a change.
Moving from being discrete is a necessity
Firms today that simply “innovate” a new product that is a discrete offering are failing to make the connections into a very different and more demanding customer way. They are wanting better, in connecting experiences to be “whole, seamless and more engaging” that many a stand-alone product or service can never provide.
Those of us designated to lead innovation have to recognize and adjust to all the shifts taking place. Managing the “steady as we go” just will not cut it anymore. Incremental innovation will continue but we will see increasingly that discrete product or service (standalone offerings) will be treated simply as part of this incrementalism, becoming further accepted as a commodity, useful but not distinctive, in any way from the existing offering as one competitor after another simply copies the latest ‘enhancement’. It is the power of connecting that promises real innovating value.
One observation we need to consider:
We are failing to recognize innovations are rarely succeeding in isolation but are growing increasingly dependent on complementaries that often are simply accepted today as the growing ‘norm’. We all live, breathe and operate in ecosystems. The need is to recognize that we all operate in “innovation ecosystems” and this will become the new organism of the business world to operate within.
We are in need of far more coherent customer facing solutions that deliver on their needs of experience, of integrative design and having endless connection possibilities to stimulate and excite them. We would argue that experience has replaced jobs-to-be-done and become “experiences-to-be-had”
Organizations need to find (urgently) ways to respond.
The onslaught of continued lifestyle changes, the wealth of digital, mobile, social and technology solutions offer a pathway through our current malaise of not delivering the innovation expected by all parties.
We need to open up our thinking to the ecosystem effect. We are beginning to appreciate the value of collaborations in multiple ways, first in the open innovation movement, then in crowdsourcing initiatives and far more recently than we often appreciate is the rapid acceleration of platforms surrounding us, allowing us to connect, collaborate, exchange and extract increasing value from the simple opportunity of participating.
We are beginning to appreciate that a platform has to have an ecosystem surrounding it to be valuable, yet ecosystems do not necessarily have a platform as its core yet it is the ‘dual’ effect of providing both will connect and hold the real promise to transform what has gone on in the past into something radical and required to manage differently.
Many platforms are simply more one way in contributing opinions, thoughts and ideas (Facebook), others offer the chance of exchange (Ebay) but it is the knowledge creating ones that work specifically towards advancing new value and solutions to often complex problems that can give the business and institutional community the greater ‘sense of reward and return’.
The transformation under way at GE
If you look to appreciate the way the health industry is valuing collaborations or even how GE has rapidly evolved or evolving into the Digital Industrial Company, you are watching a transformation taking shape that we all need to find ways to incorporate into our innovating thinking. These are ‘dual’ in the two worlds of physical and digital, combining them and building not just the ongoing robustness but the intelligence into their products, making them more like platforms. They are making the intellectual and resource investment into the building and attracting a significant network of collaborators, drawn into a specific vision that can be ‘transforming’ for all involved, one of connecting with the industrial internet and delivering far more valuable ‘predictive’ results to improve the efficiency and purpose of the machines that are doing significant parts of the world’s heavy industrial lifting.
The ‘push’ we all need to have behind us
The part that is pushing us increasingly is the digital transformation movement, the big data promise and analytical insights from this that are giving us ubiquitous choices from this massive inflow of information. How do we turn this information into knowledge and then into innovations that provide solutions that generate even more transformation?
We need to look beyond the data crowding in on us, we need to be equipped to sort it out and frame it accordingly. The front end of innovation is radically about to change. It is no more the lone researcher or company going out looking for ideas. It is connecting loads and loads of signals, looking at trends, scanning as broadly as possible, matching technology and resource management at the early stages, honing our foresight management and then, and only then, capturing these into an idea management system.
An idea management system that seeks to decipher and whittle down even more ideas, into concepts that have innovation promise BUT are these concepts that are closely matching customer needs or unmet needs, or experiences that are wanted. Ones not just adapted to meet existing organization utilization and present market positions, viewed from one organizations narrow perspective not sufficient enough to achieve the rel matching need of the customer.
Opening up our thinking towards ecosystems will have a powerful effect
Our whole understanding of innovation is changing; we are evaluating and changing our existing focus from closed (internal orientation) into open and far more collaborative innovation (external orientation) with our collective thinking offering the acceleration into improving our innovation performances, leading to higher chances of achieving greater impact and success.
The search is seemingly on for finding greater value and that will increasingly coalesce around different innovation ecosystems. We are in need to form in many different ways significantly more relationships that increasingly matter to each organization, that add value, insight and bring external expertise inside to work on ‘greater’ innovation solutions. We are creating the potential to deliver innovative products and services that would not be able to be delivered by only having the one organization attempting it. Complexity is on the rise, offering discrete products is on the wane.
Firstly why are business ecosystems emerging as a real competitive force?
As we begin to open up our thinking and begin to focus on the concept of ecosystems, it will increasingly have a powerful effect on our future growth perspectives in considering alternatives and possibilities. The network of different partners will all contribute to this often ‘emergent’ thinking and will very quickly increase the total sum of the value.
The single industry and business-specific approach are seeing change, many companies are exploring the value of becoming involved in a business ecosystem that crosses a variety of industries to build new communities that have the capacity to transform existing environments.
One has to recall the “battle of devices has now become a war of building the better ecosystem.” It is not one single product that is chasing in crowded, highly competitive fields. We are looking to increase the share of minds, engagement, offer increasing preferences that are reflecting these changing habits, tastes, and lifestyles. To plugin to achieve this ‘paradigm shift’ the search is on for forming the ecosystem or set of ecosystems that can deliver on this ‘transformation’ going on in front of our eyes.
The realization becomes one of embracing innovation ecosystems
Today there is this growing realization that thinking ecosystems allow for a new frame and mindset that taps into different and diverse relationships, partnerships, alliances and collaborations unthinkable without the enablers to make these connections through technology and more open platforms where you can come together and collaborate.
The increasing value of participating in ecosystems allows for large and small organizations to create, scale and serve markets in ways unimaginable previously. The ability to interact and co-create in increasingly sophisticated and novel ways opens up new opportunities. These ecosystems form a bond of shared interest, of recognition and purpose which quickly becomes established as the new ‘commons’ in sharing and contributing.
So the challenge is for Organizations to think differently.
Firstly thinking ecosystems allows for going out of normal scope, it allows you to open up your thinking to exploring the unimaginable of the past and transform this past ‘norm’ into the practice of your future. We are seeing the most valuable companies emerging today are largely based on sophisticated platform business models where ecosystems are vital to their health.
There is a caveat to this need to change
The more disruptive you seek to make your solution, the more the ecosystem must be shaped, changed or simply created. Placing a new product in an existing ecosystem, or worse, ignoring the ecosystem and expected total solution means your product or service will have little impact and will become a commodity quickly.
Shaping or introducing a new ecosystem is not easy but transforms competition, it provides for distinct competitive and customer propositions. Also, by thinking ecosystems and platforms, as well as equally developing the understanding of the seamless total solution that the customer expects, will need these necessary innovation ecosystems to emerge as innovation centers of the future. It ‘signals’ the amount of innovation that must be done not only on the product or service but also on the channel, the business model and on building and exploiting all the relationships within the network to make it distinctive and value. Innovation needs to move into this different connected era.
In summary
We need to find the ways that require a different thinking about innovation, a highly collaborative one. This is more centered around innovation ecosystems and this site will be dedicated to telling the innovation stories that provide the building blocks, insights, and awareness of understanding the value and growth opportunities that can come from exploring innovation ecosystems
Welcome to http://www.ecosystems4innovating.wordpress.com
Paul has framed our thinking very nicely. There are a number of interrelated ideas or concepts we are communicating in this post, the first and most important of which is: there’s a reason incremental innovation, and in fact a lot of innovation generally, fails to return a lot of value. While some people will chalk up the failure to tools, or lack of information or concerns about risk, we believe that increasingly consumers don’t buy individual, discrete products. They live, and expect their products and services to live in an ecosystem. The ecosystem of products, services and solutions is complex, but also very defining.
Increasingly this means we need to go back to Doblin’s Ten Types of innovation, to realize that in many cases, we need to be aware of and choose innovation types (product, service, business model, channel, etc). In the past we might choose to innovate a new product or service. Increasingly, innovation will require us to choose a package of types (products, services, channels, experiences) that build an ecosystem, or that leverage an existing ecosystem.
There’s a lot more here that we look forward to exploring.
Although I feel Doblin’s Ten Types of Innovation continues to serve us well, it still stays locked into one companies view of innovating, it does not step outside its wanting to ‘lock in’ it’s offering, still making it discrete and not serving the experience needs
I have written about Deloitte University Presses work on what it see’s as nine patterns of disruption. I wrote about it on my blog under https://paul4innovating.com/2016/03/02/caught-in-the-headlights-of-disruptive-innovation/ but in a further blog written for Nick Skillicorn’s “Idea to Value blog I wrote even more on this as I think this begins to offer the broader view we need
https://www.ideatovalue.com/inno/paul4innovating/2016/06/9-patterns-disruption-new-cooking-recipe-business-disruption/
These forces of disruption perhaps we need to think of them as pointing us to the ‘era of displacement’ as we are all caught up in this technology revolution. The headlights are full on and blinding all of us, it is how we quickly respond will give us a better chance of emerging out of this period of (digital) technological revolution. Technology should not disable us, it should enable.
Still more to come on this