Commentary – The Economist, 12.03.2013
Three years ago I took the plunge and did the MBA I promised myself, now complete I am happy to report! Over my career in the international chemicals industry, I’ve seen the good, the bad and the downright ugly of business.
Pennies cannot help but fall from my pockets as I came to understand the reasons behind good and bad long-term performance; strategy, leadership and most resonant of all, innovation.
Too many people believe innovation to be some sort of hand-waving-in-the-air serendipitous smoke-and-mirrors form of witchcraft rather that the critical, high-level business process at the heart of renewal of firms and to the benefit of society at large.
The piece in The Economist takes, well, and economists perspective. That’s fine, because there are many forms of innovation; technological, business-model, service etc. However it is usually that case that some science or technological base forms the root of an innovation. It goes on to wonder whether breakthrough innovations are a thing of the past and that the rate of delivery will naturally slow down. I’m reminded of the views in the late Victorian era that believed that “all invention has already been invented.” One needs to define innovation and its typology to make sense of this…
By innovation I mean, the “process by which companies bring new products, processes or services to generate value in the market”. These may be new in the sense of new to world, new to industry, to business or to location. The scale I would argue matters less; that it is done at all, the frequency and the success rates are more important.
So, at three scales, the new thing maybe just that little bit better (the title of the blog) but done many times over. See the success of the incremental approach through the Toyota production system or the marginal gains responsible for the British track cycling team’s success. In my opinion this is very much an underrated scale of innovation. At the next scale, innovations may be break-though/step-out that leapfrog products already in production. Finally, the disruptive sort described by Abernathy and later, Clayton Christensen completely break the frame of what has gone before. We’ll talk about technology trajectories another time.