I read a really interesting article today, by someone who is quite obviously a leader in the field of innovation. He posed some interesting questions around a topic that I have been thinking about for some time, and it has prompted me to put down my thoughts on this topic.
The article was entitled On the Hypocrisy of Innovators, written by Jeff DeGraff, a Professor at the University of Michigan, and you can read it by following the link.
In brief, the concept is - can you innovate when you are already a market leader, without challenging your own norms? By definition, the concept of innovation, as defined by the Oxford English dictionary is as follows:
verb: make changes in something established, especially by introducing new methods, ideas, or products.
The key here is the first part of the definition of innovation: to make changes to something established. This is the part I am really questioning - as a market leader, you are established, you are the de facto standard for that particular product or offering. Whilst you may come up with new ideas, methods or products, you certainly cannot make broad sweeping changes to something you yourself have established without damaging your own investment.
If the general principle of business is to be followed, the bigger you get the more you have invested in protecting that base, not upsetting it. And innovation is precisely that - upsetting the generally accepted norms.
Take the music industry for example. It has everything invested in protecting its current model of revenue generation, which is the sale of music through an authorized channel. Innovation in this respect does not come from those with the most to lose, the market leaders. Those companies have grown too reliant on their current business models to innovate too strongly around anything that may cause those streams of revenue to be damaged.
On the other hand, an amazing woman by the name of Amanda Palmer (you can see her awesome presentation at the TED Talks here) can turn the current music revenue stream on its head. She can innovate - because she has nothing to lose. She is taking on the established methodology, and making changes to it - changing it in a fundamental way that will mean that no matter what happens in the future, the way people view purchasing music will forever be changed. Now THAT is innovation!
Why do giants emerge, then fail over time? Has this not been a pattern we have seen over and over again in our industry? Hewlett Packard, Novell, Lotus, Nokia, Blackberry - so many massive companies have waxed and waned.
They've lost to the innovators - the newcomers to the market who have taken them on - changing core features that the incumbent players have not dared to change without the fear of losing their core business.
Look at RIM, and their Blackberry. The ubiquitous device was the undisputed market leader - now they're running a very sad third to Apple and Android. And why? Because they were too scared to innovate away from their trademark keyboard, even when the market moved that way.
When they finally woke up, and launched their half touch screen, half keyboard model the 9900 - it was too little too late - innovation in the form of the iPhone and the Samsung Galaxy had come and they had missed the boat. Their market share fell faster than anyone could have believed, and what remains is largely history playing out, as they through caution to the wind and try to make their final comeback strategy with their new Blackberry 10.
Oddly enough, they now have the ability to innovate. Unlike Apple and Android who have a lot to lose, and so cant make too many changes, Blackberry's failure to date has made them the new underdog. They are left with a few loyal customers wanting them to succeed, and little to no general market expectation. They will discover, as so many have before them, that innovation is a lot easier when your back is against the wall, and you have nothing left to lose.
Which brings me to my final point (for now) on this topic.
Its much easier to innovate when you're starving than when you're not. There is no substitute for having nothing to lose when it comes to really upsetting an industry or a concept with something completely new.
And that's real innovation!
