The New Innovation Era

The Dynamism in Chinese Ecosystems and Platforms

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chinese-tigers-3

Today we have to “think China” when it comes to looking for the dynamism within Ecosystems and Platforms, they are leading, exploring and extending the thinking beyond our more limited ambitions in the West.

It is the environmental conditions coming together or being explored and exploited that make China stand out in its dynamism in this area.

It is that combination effect of the Government building, laying in ‘accepted’ guidelines and encouraging the infrastructure, it is the business entrepreneur and the social conditions that are enabling so much.

Dynamism is the quality of being characterized by vigorous activity and progress. It projects an energy, force, power and vigor and a strong desire to make something happen. It is the manifestation of these forces (conditions) that is constantly pushing the boundaries of our understanding of what is possible in the ecosystem and platform approach. The Chinese have found ways to experiment, develop and constantly create a real motion within the system.

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The Emerging Industry 4.0 Business Ecosystem

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The PwC Industry 4.0 framework
The PwC Industry 4.0 framework

We are moving rapidly from the industrial economy, reliant on single companies simply producing specific products they believe consumers needed or simply accepted.

This approach is often giving consumers no or limited choice and this supply-side approach is about to change into one that is driven by a digital economy where all sides of the value equation are connecting. One where consumers have a greater ‘voice’ over their choice that manufacturers will need to listen to and respond accordingly.

This connected world is driving transformation inside every industry, pushing for innovation dynamism as knowledge exchanges are accelerating.

There becomes this increasing business “commons” of connecting, communicating, seeking manufacturers to collaborate far more closely, across new technology and infrastructures, that allow for a greater ‘economic diffusion’ than ever before.

Industry 4.0 is driving much of this change within industries and emerging are some powerful industrial digital ecosystems such as GE are driving to achieve, to transform their business.

There is a dramatic shift in recognizing where our future assets lie. In the past, it was heavily invested in physical ownership, the knowledge was kept within organizations and this ‘became the competitive advantage. Today that is rapidly disappearing, the knowledge is recognized to lay mostly outside the organization, it is the ‘connected minds’ across multiple stakeholders, that participate through and across new platforms and ecosystems and how these are leveraged and managed is where are looking to gain any new competitive advantage.

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Innovating with the ecosystem in mind

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credit: dupress.deloitte.com
credit: dupress.deloitte.com

In our previous posts, we’ve asserted that the reason so many “innovative” new products and services fail is because the innovators fail to understand the circumstances, ecosystems and environments in which the new product must exist.  Even more important to consumers than new features is ease of use, ease of integration, ease of connection.  We call this a holistic, continuous seamless experience.

If seamless experience, as we’ve defined it in previous posts, is the emerging requirement for innovators, then what are the components that construct a seamless experience?  And further, if seamless experiences are so vital, what are the forces that converge to create so much interest in seamless experiences?

If we consider and answer these questions, innovators can see a growing confluence of ecosystems, platforms and patterns of disruption that are combining to create new opportunities.  We can also take a look back at past innovation efforts to see how little we’ve moved the needle in terms of customer engagement and the value that past innovations have created.

With so much in motion, it’s time for a careful consideration of what fuels innovation, what patterns exist and what factors – such as ecosystems and platforms – will combine to create what customers really want:  a continuous, holistic and complete experience.

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Platforms are the new gold rush for business today

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western-colarado-gold-prospectingPlatforms presently are the new gold rush we in business need to exploit today. They are becoming an essential part in our needs to shift to the new creation of connected value.

What is absolutely necessary, is the need to stake out where you believe are your best prospecting chances and for that you need to have a clear vision and plan, as you think through any shift into platform management.

It is a significant transforming decision, full of risk but equally full of real promise.

Different forms of platforms have been around for years, even centuries, where people came together, traded in goods and knowledge. The significant transformation taking place around exploiting technology and digital management has made ecosystems and platforms a mainstream prospecting need in most of our businesses today.

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Innovating the Minimum Viable Experience

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minimum-viable-pathway-for-experienceThroughout our blog posts about innovation, ecosystems and platforms, we’ve maintained one core theme:  incremental, discrete product innovation will not create significant new revenues or disrupt markets.

The reasons, as we’ve discussed, include the growing expectation of seamless experiences from the consumers’ viewpoint and the rising importance of platforms and ecosystems in which new products or services exist.

Minimum Viable Footprint

Today I’d like to highlight a new idea – innovating for the “Minimum Viable Footprint”, an idea that was first proposed in Ron Adner’s book entitled The Wide Lens.  Adner defines the “Minimum Viable Footprint” or MVF as “the smallest configuration of elements that can be brought together and still create unique commercial value“.  The MVF is the logical outcome of two realities:  first, the already discussed idea that innovators need to innovate more than just a product, but must consider the ecosystem in which the product will reside, and second, the concept of a minimum viable product – something many companies already understand and practice. 

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Are you thinking about Innovation Ecosystems? You Should

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innovation-ecosystem-dna-complexitygraphics-com
image: www.complexitygraphics.com

All around us, we are faced with new challenges. One of those is a profound shift taking place relating to innovation. Increasingly we are seeing a growing dissatisfaction on the impact that innovation is having; in growth, in returns, in market and customer impact.

One of the implications is this growing recognition that innovation is rarely succeeding in isolation but is growing on a more highly dependent type of complementary innovation. This will have a significant impact on organizations innovation management design and approach.

Innovation ecosystems are being established that fundamentally are challenging the way we are managing currently and in the future our innovation activities, setting about our innovating of “doing things” in very radically different and more connected ways.

These are threatening to dismantle the way innovation is being managed today, and due to this, we require a radical adjustment in our approaches to achieve a far more collaborative one built on innovation ecosystem thinking.

So what is this change occurring for us to consider the value of Innovation Ecosystems? Making the case.

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Why you need an experience manager for innovation

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customer-experience-journeyThrough our discussions about innovation, ecosystems and seamless experiences we’ve highlighted the fact that 1) innovation doesn’t work that well for many companies because we believe that 2) these companies create discrete products rather than fully understanding the ecosystem the products enter and 3) they don’t understand that customers are seeking seamless experiences more than ever.

If these points make sense to you, the question becomes, how do we create seamless customer experiences?  What makes up the solution?  How do ideas like the Geoffrey Moore inspired “whole product” combine with tools like customer experience journeys and design thinking to help an innovator understand the potential seamless solution?  And, how does an innovator decide what components in the ecosystem or solution they should create, and which to partner for or rely on external partners for?

I’d like to begin this post by arguing that this issue stems from another fallacy – the fallacy of being “customer centric”. 

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New innovation realities require new mindsets and tools

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new-minsets-tools-and-skillsOur belief is that customer demand is changing. This will have a significant impact on the way organizations will have to adapt and change their innovation approaches in the future.

Jeffrey recently wrote this, initially on his blog site of Innovate on Purpose and reproduced here.

We felt this is an important point of understanding to bring into this dedicated site as it addresses one of the present sets of challenges we need to resolve, one of updating our innovation tools, thinking and methodologies.

Paul & I have started outlining the key needs of change here  in this dedicated site and will through an evolving series of blog posts about innovation, ecosystems, platforms discuss these changes and needs to respond to what we believe customers will ultimately demand:  seamless experiences.

Our view is as products and services proliferate and basic needs are met, customers become more sophisticated and more demanding, desiring products, services and business models that work together and don’t require configuration, integration or effort by the consumer to “make them work”.  Customers and consumers increasingly expect a seamless experience when using a new product.  If the product or service requires the customer to combine products, read manuals, acquire other products or services to make the solution work, the new product is likely to receive far less acclaim.

Understanding that, we should understand also that the tools that once helped innovators create new products aren’t the same tools that we need today when customers demand seamless experiences.  Or, put another way, those original tools are still valuable, but by themselves they solve only a small portion of the overall challenge. Let us here outline some of the present constraints or limitations to challenge and recognize our needs to shift our present thinking

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Widen the aperture, narrow the focus

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widen-the-aperture-narrow-the-focus-real-value

Today, customers are busier, smarter, have shorter attention spans and most importantly have less desire to make products or services work together.

Apple,  Amazon, and EBay are examples that  have taught customers that products, services, data, experiences, and design can all work together to provide a totally seamless experience.

Increasingly, this is what customers are increasingly wanting, and to do that you’ll need to rethink the way you innovate.

In Jeffrey Phillips post “Using ecosystems to build seamless experiences” we raised this present poor understanding within a business, that many lack a good understanding of customer needs.  Actually, it is far worse than we initially felt, still more on that later.

This is a longish read but an important one, to frame our need to think through innovation differently, through a new lens. Take your time, knowing why we need to change is critical. There is a new innovation era that holds promise if we think differently.

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Using ecosystems to build seamless experiences

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source: uxmag.com
visual source: uxmag.com not text

In the first post of this series, Paul Hobcraft framed what we believe is an exceptionally important issue:  innovation doesn’t really work the way we’d like it to.  Far too often, innovation creates incremental, discrete products that don’t seem to drive customer engagement, don’t create disruption in the marketplace and don’t drive a significant amount of revenue or profit.

There are many reasons we could point to – poor understanding of customer needs, risk and uncertainty constraining innovation teams, lack of innovation process and training on the part of the innovation teams, little to no funding, and so on.  These are common challenges that innovation teams face.

However, we believe that many innovation challenges stem not from a lack of internal knowledge or capability, but from misunderstanding the customer and his or her expectations about experiences.  Customers today expect seamless experiences, supported, maintained and enabled by complex ecosystems of products, services, business models, channels, information, and complementary products and services.  Customers aren’t interested or willing to acquire disparate products and services and integrate them. Increasingly customers prefer to acquire seamless experiences, and this expectation will dramatically change how companies innovate.

The problem of narrow focus

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