Building innovation capability the strategic imperative

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Building innovation capability the strategic
imperative

• John Bessant
• Cranfield University/
• Advanced Institute for Management Research

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The innovation imperative ...
New response needed
Low uncertainty
High uncertainty
Old response appropriate
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A strategic challenge ..

• To the organization a survival/ growth
  imperative
• To innovation leadership
• Direction exploring the innovation space
• Philosophy models and understanding which shape
  action
• Execution creating enabling conditions
• A moving target constant review and learning
• Innovation as dynamic capability

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Exploring innovation space
Paradigm ( mental model)
Innovation
Process
Product
Incremental do better
Radical do different
Position
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Thinking about innovation
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Invention is not enough
Musical flamethrower
Gas-filled umbrella
Decoy ducks stay dry!
Cheese-flavoured cigarette
Foetus Walkman
Coffin escape system
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Understanding innovation
How we think about something.
shapes the way we manage it
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Partial models of innovation
Innovation invention
Star turns
Knowledge push
Single enterprises
Product innovation
Radical change
Manufacturing
High technology
Market led
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What do I do on Monday morning?

• Is innovation manageable ?
• How do we know?
• What do we know? process models, key routines,
  etc.
• Caveats, contingencies, configuration
• Create conditions rather than mechanical
  control

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An emergent good practice model
Pro-active linkages
Innovation Strategy
Learn?
Innovative organization
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Are we in shape for innovation?

• Do we have effective enabling mechanisms?
• Do we have strategic fit and commitment?
• Do we have an innovative organisation?
• Do we have pro-active linkages?
• Do we learn and build capability?

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Learning isnt easy .
Here is Edward Bear, coming downstairs now,
bump, bump, bump, on the back of his head, behind
Christopher Robin. It is, as far as he knows,
the only way of coming downstairs, but
sometimes he feels that there really is
another way, if only he could stop bumping for a
moment and think of it .
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The moving frontier problem .

• Learning and implementing good practice
• Learning to deal with new challenges
• E.g. inter-firm innovation
• E.g. discontinuous innovation

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Is there a problem?

• smart firms stumble and fall
• e.g. disruptive innovation (Christensen)
• e.g.technology dispossession
• e.g.cognitive dissonance
• problem of discontinuous conditions
• steady state capability is not enough

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A successful innovator?

• Medproducts Danish medical devices producer
• Dominant market position, multiple award winner
  for innovation
• Founded 1957, close user/producer synergy
• Developed deep competencies around skin/wound
  care
• Developed close market linkages user active
  paradigm e.g. nurses panels
• Developed robust innovation management routines -
  e.g. AIM process
• What do they do on Monday morning? More of the
  same?

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Concerns

• 'because it's all focused on this well-oiled
  machine there are no resources for the radical
  ideas'
• 'there should be a forum where it's allowed to
  have new ideas and it should be supported where
  there is money to run with these good new
  ideas..'
• 'many new ideas would be killed off because
  they are not big enough'
• 'people aren't taken enough out of their daily
  work to think differently'
• because product development is so structured
  there's no real room for radical ideas, no 'let's
  try this', no way to run with it outside the
  structures'

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Sources of discontinuity
Ice, valves, photos, light sources
New technology emerges
Disk drives, mini mills, excavators, SMS
New market emerges
Centrally planned, apartheid, trade liberalisation
Political regime
Encyclopaedia Britannica, Kodak, Preussag
Running out of road
Music industry, green products, health issues
(smoking, obesity, etc)
Sea change in social attitudes/ behaviour
Telecoms, utilities
Regulatory regime changes
Low cost airlines, internet services
New business models
9/11
Unthinkable events
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Steady state vs. discontinuous
Degree of uncertainty
Uncover
Co-evolve
Exploit
Flex
Degree of instability
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Emerging routines for managing DI
Pro-active linkages
Innovation Strategy
Learn?
Innovative organization
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Innovation leadership .

• Innovation as a survival/ growth imperative
• Effective innovation leadership needs
• Philosophy models and understanding which shape
  action
• Direction exploring the innovation space
• Execution creating enabling conditions
• A moving target constant review and learning
• Innovation as dynamic capability

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Innovators
Ray Ewry (1873-1937) Olympic Games, London,
1908 World record 1,98
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Innovators
Mildred McDaniel (1933) Olympic Games,
Melbourne, 1956 World Record 2,15
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Innovators
Richard Fosbury (1947), Olympic Games, Mexico,
1968 World Record 2,24 m
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Radical process innovation
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The prices and weight of all goods are all
clearly marked. You just take what you want.
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Position innovation
1927
2005