As Mark Twain is reputed to have said, “It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so.” WeWork’s investors thought that by pumping tons of money into a conventional business they could transform it into a super-profitable platform. They were terribly wrong, but they won’t be the last ones to try.
We like to think that innovation is about ideas, but it’s really about solving problems. In order to surface problems, you need to ask questions, which is why Steve’s businesses started doing better when he got out of the building to talk to customers. The better questions you ask, the better problems you can identify. Here are 4 questions that will help you do that.
Every startup is exciting and romantic in the beginning. Long hours and shared experience makes the business feel less like work and more like a family. Yet as the company grows and more people are brought on, the social fabric begins to fray. The story is so common that nobody should be surprised when it happens, but inevitably most are, which is why few entrepreneurs prepare for it. That’s a shame, because the breakdown of the family atmosphere can be avoided if you prepare for it.
Clearly, ideas are important, but not as many believe. America is what it is today, for better or worse, not just because of the principles of its founding, but because of the actions that came after it. We revere people like Einstein, Pauling and Jobs not because of their ideas, but what they did with them. The truth is that although possibilities are infinite, ideas are limited.
While many companies today are attempting to leverage AI to provide similar service more cheaply, the really smart players are exploring how AI can empower employees to provide a much better service or even to imagine something that never existed before. “AI will make it possible to put powerful intelligence tools in the hands of consumers, so that businesses can become collaborators and trusted advisors, rather than mere service providers,” Sutton says.
The story of Fleming’s Eureka! moment is romantic and inspiring, but also incredibly misleading. It wasn’t one person and one moment that changed the world, but the work of many over decades that made an impact. As I explain in my book, Cascades, it is small groups, loosely connected, but united by a shared purpose that drive transformational change.
The truth is that the challenges we face as a society today, climate change and food security being two of the most prominent, are far more complex than anything we’ve tackled before. Even a company like IBM, with its century of history and multi-billion dollar research budgets, can’t go it alone. In the new era of innovation, collaboration is increasingly becoming a competitive advantage.
Go to just about any business conference and you will see a pundit on stage. He or she will show some company that failed and explain the silly mistakes that they made, then follow-up with a few basic rules to help you avoid those pitfalls and become super successful. You leave feeling confident, because it all seems so simple and easy.
There are some common principles in how innovators approach their work and these are things that anyone can apply. That doesn’t mean everyone can be world famous, but the evidence clearly shows that anyone can be creative and, even if it’s not a major breakthrough, make some contribution to the world.
As our technology becomes almost unimaginably powerful, there is growing apprehension and fear that we will be unable to control what we create. The emergence of significant new technologies unleash forces we can’t hope to understand at the outset and struggle to deal with long after. Yet the most significant issues are most likely to be social in nature and those are the ones we desperately need to focus on.
When you think of breakthrough innovation, someone like Steve Jobs, Jeff Bezos or Elon Musk often comes to mind. Charismatic and often temperamental, people like these seem to have a knack for creating the next big thing and build great businesses on top of them. Yet what often goes unnoticed is that great entrepreneurs build their empires on the discoveries of others.
Every organization strives to innovate, but few succeed consistently over time. That’s why so many once dominant companies hit a peak and then decline. Yet IBM, Google and Amazon have been able to buck this trend. While most companies are lucky to come up with one major innovation, these three seem to be accelerating their ability to create impressive new products and services.
Before you embark on a game changing initiative, your organization needs to be prepared for it. In a recent article for Harvard Business Review, columnist Scott Kirsner pointed to a survey of 270 corporate leaders that found that the most significant obstacles to innovation are not things like budget, skill sets or CEO support, but politics and culture. Those are pervasive issues and can’t be solved overnight, but they can be overcome.
The challenges we face today will be fundamentally different because they won’t be solved by humans alone, but through complex human-machine interactions. That will require a new division of labor in which the highest level skills won’t be things like the ability to retain information or manipulate numbers, but to connect and collaborate with other humans.
What makes great innovators different is that they succeed where most others fail. They not only come up with new ideas, they find ways to make them work and create value for the rest of us. Even more importantly, they are able to do it consistently, year after year, decade after decade.
Success does not, in fact, always breed more success, sometimes it breeds failure. That’s why every business needs to innovate. Yet innovation is not, as some would have us believe, just about moving fast and breaking things. It’s about solving the problems you need to create a better future. What most fail to grasp is that a key factor of success is how you source problems, build a pipeline and, ultimately, choose which ones you will work on.
Today digital technology is all the rage because after decades of development it has become incredibly useful. Still, if you look closely, you can already see the contours of its inevitable descent into the mundane. We need to start preparing for a new era of innovation in which different technologies, such as genomics, materials science, and robotics, rise to the fore.
Today, as Moore’s Law is slowly petering to an end, we’re on the brink of a new era and, in time, marketing will be transformed once again in ways that are hard to see right now. Over the next decade marketers will need to begin to shift to the post-digital world of computing. This next transformation promises to be at least as revolutionary as the last one.
The truth is that the next big thing always starts out looking like nothing at all. Things that truly change the world always arrive out of context for the simple reason that the world hasn’t changed yet. They need to build up ecosystems around them and identify meaningful problems to solve. That takes time.
By aggregating and analyzing massive amounts of known data, we can drastically narrow down possibilities and save enormous amounts of time and money — possibly a 10x improvement or better. That opens up massive opportunities to do research that would otherwise be cost prohibitive.
The key to solving fundamental challenges is to go both wider and deeper. We need to understand problems on a fundamental level and then in search of new perspectives, both from experts in other fields and seeking out new experiences ourselves. Innovation is never about individual nodes. It’s always about networks.
It seems like everybody these days is looking for an early version of Steve Jobs. Yet I found that most great innovators were nothing like the mercurial stereotype. In fact, almost all of them were kind, generous, and interested in what I was doing. Many were soft-spoken and modest. You would notice very few of them in a crowded room.
In the coming years we are likely to see a new era of innovation that will look more like the 1950s and 1960s than it will the 1990s or 2000s. In the next few decades, I predict, much of innovation’s value will shift away from applications and back to fundamental problems. That will require greater focus on sustaining efforts to solve grand challenges.
A recent McKinsey report found that while 84% of corporate executives think innovation is key to achieving growth objectives, only 6% are satisfied with the innovation performance of their firm. That’s quite a mismatch. It’s hard to imagine that a success rate that low would be tolerated in any other business function.
We need to start treating innovation like other business disciplines — as a set of tools that are designed to accomplish specific objectives. Just as we wouldn’t rely on a single marketing tactic or a single source of financing for the entire life of an organization, we need to build up a portfolio of innovation strategies designed for specific tasks.
Probably the most persistent myth about innovation is that it is the product of a lone genius who experiences a magical moment of epiphany and changes the world. This can be incredibly appealing because it implies that, if we are one of the chosen, a great idea will come to us in a flash and the job will be done. Like unicorns, the Eureka! Moment is mostly a myth.
The truth is that innovation is never a single event. First, scientists need to discover new phenomena, like Fleming's early work with antibiotics. Then those phenomena need to be engineered into a viable solution to an important problem. Finally, the new technology needs to be be adopted by the marketplace. This process of discovery, engineering and transformation usually takes about 30 years. If we really want to understand what lies ahead, we need to start with discovery.
Take a look at any successful enterprise and you’ll find innovation at its core. That was just as true a hundred years ago when Henry Ford perfected the assembly line as it is today, when modern day giants like Elon Musk bring cutting edge technology to market. Innovation, as I’ve written before, is how people come up with novel solutions to important problems.
Last week, IBM announced that it lead the list of companies receiving US patents for the 23rd consecutive year. IBM’s patent leadership is extreme. It not only consistently tops the list, but outpaces the number two company on the list, Samsung, by 50%. That’s pretty impressive.
Successful businesses grow. Through better products and processes, they win the favour of customers, increasing their volume and margins. That success often translates into further advantages as they invest in new and better equipment, develop expertise and gain bargaining power with suppliers. So it’s curious that so many successful businesses fail. Today, in fact, only 13% of the original Fortune 500 companies from 1955 are still around.
There’s comfort in numbers, so it’s easy to go along with the crowd. However, crowds are often stupid. Simply going along with them can lead us horribly astray.
In the 1950’s, Solomon Asch, a prominent psychologist at Swarthmore College, conducted a series of conformity experiments that shed light on our capacity to go along with the crowd. The design of the study was simple, but ingenious.
Today, rather than paying for a daily newspaper, most people get their news for free online and many incumbent media businesses have begun erecting paywalls for their content. Yet, as I’ve said before, paywalls aren’t generally a smart way to go. Successfully implementing a paid platform requires a smart business model, not a moral crusade.