Print this pageIt's an Innovative World
Over the last half of the 20th century, businesses have often relied upon product innovation, product quality, and process improvement to compete. Product quality became a ticket to play. Businesses became experts at incremental improvement with the programs and techniques of TQM, lean, and six-sigma.
Innovation's Acceleration
With the globalization of business, competition became brutal. The consumer value proposition shifted dramatically, in both lower prices and higher quality, with producers from around the world.
Beyond an increasing number of lower cost producers, there was another impact of the technological and management science changes that enabled globalization. Factors driving change enabled the rapid formation of new businesses. Imagination became a true competitive force. Instead of innovation capital flowing into the research labs of semi-monopolistic giants like ATT and Xerox, it flowed to new to the world ventures. Innovation now has a free market instead of the carefully controlled management it used to have in the corporate giants. The talent from top flight universities now flows to business startups. Businesses began to be designed and built more like new products as the barriers to entry into the industry stalwart's turf fell away.
From Progress to Revolution
The rules for success have changed. What used to produce an advantage no longer results in that outcome. Schumpeter's Creative Destruction has gone from a slow evolution, viewed over long periods of time, to now play out in near real-time before our eyes. As Hamel says, the age of Progress, that of linear continual improvement is over. It is now the Age of Revolution, that of discontinuous improvement, with new business concepts arriving at an increasing rate.
Innovators Gain the Lion's Share of Business Value
Just as product life cycles are decreasing, business model life-cycles are decreasing from decades to years. To add insult to injury of those companies that have not jumped on the creative innovation train, there is a polarization of business value, with the lion's share of value going to the innovative leader in the market. The value remaining with the other competitors is far below their proportional market share.
From Continuous Improvement to Business Innovation
The ticket-to-play has shifted from continuous improvement and quality to creative innovation of the business model and management innovation. Innovative strategy creation and business model design are competencies to be developed by firm's expecting to survive, much less thrive. Mastery of this competency is not well defined or easy. Even well defined fields such as quality, which matured greatly over the past half-century, require great wisdom and discipline to reap the benefits. Strategic management has a long way to go to become a well-defined field for mastery. The strategic management framework presented here is one more step in the direction of an organized and useful body of knowledge for the evolving field of strategic innovation.
Driving Business Innovation with Strategic Management
Developing a new competency which taps and unleashes your organization's imagination, creativity, passion, ambition, and emergent solutions can be daunting. This is a cultural shift of major proportions that leaves little untouched. The strategic management framework provides much needed guidance.
