Saturday, October 22, 2022

8 Keys To Surviving and Thriving In This New Economy

business-innovation-paceEntrepreneurs and startups are big believers in innovation, but sometimes they forget that innovation must be continual to assure long-term success, rather than the one big-bang idea that initiated their journey. By default, innovation in every business decreases over time, and continuous innovation requires ongoing initiatives and measures of customer perceived value.

The long-standing rule of thumb that companies have ten years between significant disruptions was reset a few years ago to five years, according to experts Larry Downes and Paul Nunes. From an insider perspective, 37 percent of CFOs now see the required target as a significant innovation every one-to-three years, according to a recent IMA innovation survey.

Getting innovation to happen this regularly requires some real disciple and processes. Check out the classic book, “Advancing Innovation: Galvanizing, Enabling & Measuring for Innovation Value!” by Patrick J. Stroh, which details the principles and metrics to follow for fostering innovation in any organization. Here are his key recommendations from my perspective:

  1. Surround yourself with a great team. Get the right players on board and enable them to do great things. Don’t wait too long to swap out players that don’t fit from a skill standpoint or a cultural perspective. Hire slowly and fire fast. Build trust and motivation in your teams consistently, and prepare to be surprised at the speed of innovation.
  1. Ensure that you have good advisors. Every entrepreneur, no matter how experienced, will benefit from a personal board of directors or advisors to guide them in facets of their business. Good advisors will tell you what you need to hear, while friends will tell you what you want to hear. You need both in business, with the insight to tell the difference.
  1. Recognize that customers care about the whole experience. People pay for a great user experience, in finding the right product, buying it, using it, and getting support. Today they demand it or walk to competitors, who are not far away. When is the last time you listened to customers and clients directly, and acted on their feedback immediately?
  1. Target a portfolio of solutions, not just one product. A startup may start with a focus on one solution, but long-term growth and success requires a range of solutions, with annual innovations on every one. Sometimes the hardest thing for companies to do is to retire a cash cow product, before its declining market is reinvigorated by a competitor.
  1. Incent everyone on the team to be an innovator. Normally the best innovations come from the people on the front line, rather than a top manager or designer. Yet most of the people who count are often paid to make things work the way they have always worked. Remove fear of failure, then demand and measure innovation as key to job performance.
  1. Give customers what they want, even if they don’t know they want it. Good people listen intently to customers, apply a knowledge of the industry, and imagine a better experience, based on insights and talent applied to unspoken customer needs. Great innovations always seem obvious and simple to customers, after the fact.
  1. Align the interests of partners and other constituents. In many cases, those that appear to be your competitors can actually be your allies, and through partnerships (co-opetition) and agreements you can create more value together than you can achieve separately. Aligning interests fosters growth and innovation from all constituents.
  1. You can’t improve something if you can’t measure it. Use the Innovation Value Score® approach described in the above book, or any relevant yardstick, to measure and compare with other companies and achieve more innovation value. It’s all about results, benchmarked against strategic plans and a vision of what is possible.

As the pace of change in the marketplace increases, innovation is required at a faster pace in every organization, old and new, to stay competitive. According to an often quoted McKinsey report, 94 percent of existing company executives said they were dissatisfied with their company’s innovation performance, compared to competitors.

That fact should convince you that galvanizing innovation only gets harder as your company grows and matures. Thus it behooves every new startup to build the suggested innovation practices into their culture and organization from the beginning. Catching up later is not a viable strategy for survival.

Marty Zwilling



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