Innovation ahs become the most hyped word in the dictionary of business models in the 21st century. New ideas, concepts and products have provided firms with tools to counter the dynamic forces of change. Innovation has helped firms improve on their longevity and also aided with them forces with which they can transform the industry structure rather than waiting for the change to hit them and be causght unawares.
Organizations face challenges with a view to create innovation that lasts and to initiate an architectural change in the industry structure. The industry, next faces the task of implementing these innovations and introducing them to the markets. For eg. the battle between the LCD and LED in the TV market has been shaped by the market forces and the consumer acceptance rather than the features and superiority of the format. The context and time of the innovation is also important as innovations may fail with changing needs and demands have a scope of resurrection. Innovation can be seen by firms as providing an opportunity to foster growth eternally for them but they need to be aware of the potential for the next big change.
The present age of revolution is marked by the dazzling and the unknown. However, the path to innovation follows these simple rules as have been elaborated below:
1. Expect the unbelievable: No person has desired for the next door shop and reached the moon. We aspire and achieve as much as we are capable of but our aspiration forms the upper limit of our achievement. No company or individual can outperform what they aspire to achieve as our efforts are in the same proportion as our aspirations. Therefore, our aspiration becomes the determing factor. We set ourselves towards unthinkable goals and work towards achieving them.
2. Removal of restrictions and constraints: Flexibility in the business model allows organizations to innovate and accept change more rapidly. In the modern business world, it is difficult and not advisable for companies to restrict themselves to few product lines with distinct markets and specific competitors. PepsiCo has diversified from colas to juices as well as snacks and drinking water. Companies believe in using their brand to capture a wider market share and tap consumers in various nations. An elastic business permits managers to diversify without any fear of cannibalization.
3. Vision: The vision of the firm gives it an identity that people can associate with and feel passionate about. It gives employees a sense of purpose in their work. Revolutionary innovations cannot take place without a sense of purpose in the beginning and achievement in the end. The skills and relationships of all its employees are valuable to the firm, and hence, the purpose of the firm guides the organization like a beacon of light. The vision, feeds life into the most inanimate of products and this is what motivates the people to innovate and bring about positive change in the lives of the consumers they serve.
4. Hear the revolution before feeling it: There are voices around who can make the next path-breaking change. Vandana Luthra began VLCC as a recation to the constant cribbing of people about the lack of right knowledge and tools to achieveing weight loss. People in companies can have innovative solutions to their problems but the top-down approach can inhibit them from expressing themselves. Hence, companies need to instate a mechanism for revolutionary ideas to reach the right ear and make a difference to the organization.
5. Have an open mind for ideas: This rule is applicable not for the company, but for the marketplace. The internal market for ideas exists and allows the formation and perpetuation of ideas for the organization to benefit as a whole. The reason behind the success of Bangalore as an IT hub is the breakdown of hierarchies that created an atmosphere for innovative ideas to germinate and a platform where they could be shared with the management. The organization has no prejudices about the capability of individuals or the stereotyped portfolios of innovators. Everyone who has ideas is accepted and allowed to present their thoughts to the organization. The most regular chores can lead to the most brilliant of ideas and they form the innovation wave for the next big thing.
6. Open market for capital: VC's and Angel investors are people who recognize the worth and potential for innovation and invest in the creation of the next big wave for change. While traditional financial firms have set notions of effectiveness and productivity of ideas, these people are eager to dirty their hands with the unknown and the unexplored. Also, capital is an essential requirement for innovations to take flight and see the light of the day that they have helped to create.
7. Open market for talent: People need to keep an open mind for creative potential. Efficiency and qualifications are mere signals as companies endeavour to segregate open minded, fresh ideas from mere academic excellence. Talent that adds value to the organization comes at a premium and it is the prerogative of organizations and investors to recognize the potential of talent and give it a fillip. Organizations can challenge people and truly talented people find innovative solutions to the company's challenge. However, talent is not mere restricted to academic qualifications and the market for talent is not essentially a market for employment.
8. Low Risk Experimentation: The answer to innovation lies between risk averseness that compels people to take the safe, well-trodden path and heady, dangerous ventures characterized by high risk and high returns. Portfolios help spread risks over multiple projects with relatively low probabilities of success but a high chance of atleast one succeeding. Even individually, they can generate dramatic returns.
9. Cellular division: Cellular division allows different business models to develop within the same organization and frees the human and capital resource to adopt it. It helps nurture thought and innovation as the companies then run as separate entities and the managers run almost independent businesses in the same organization. Innovation and flexibility grow in such an environment.
10. Personal wealth accumulation: The returns that a company gets out of successful innovations need to be shared with entrepreneurs and investors whose efforts have helped in materializing those gains. Wealth incentives are a way of keeping the innovator from switching companies and build a sustainable innovative base for growth and development in the long run.
These rules, if properly implemented, can pave the way for successful innovations.
Cheers!!!
Signing Off
Shauvik.
Organizations face challenges with a view to create innovation that lasts and to initiate an architectural change in the industry structure. The industry, next faces the task of implementing these innovations and introducing them to the markets. For eg. the battle between the LCD and LED in the TV market has been shaped by the market forces and the consumer acceptance rather than the features and superiority of the format. The context and time of the innovation is also important as innovations may fail with changing needs and demands have a scope of resurrection. Innovation can be seen by firms as providing an opportunity to foster growth eternally for them but they need to be aware of the potential for the next big change.
The present age of revolution is marked by the dazzling and the unknown. However, the path to innovation follows these simple rules as have been elaborated below:
1. Expect the unbelievable: No person has desired for the next door shop and reached the moon. We aspire and achieve as much as we are capable of but our aspiration forms the upper limit of our achievement. No company or individual can outperform what they aspire to achieve as our efforts are in the same proportion as our aspirations. Therefore, our aspiration becomes the determing factor. We set ourselves towards unthinkable goals and work towards achieving them.
2. Removal of restrictions and constraints: Flexibility in the business model allows organizations to innovate and accept change more rapidly. In the modern business world, it is difficult and not advisable for companies to restrict themselves to few product lines with distinct markets and specific competitors. PepsiCo has diversified from colas to juices as well as snacks and drinking water. Companies believe in using their brand to capture a wider market share and tap consumers in various nations. An elastic business permits managers to diversify without any fear of cannibalization.
3. Vision: The vision of the firm gives it an identity that people can associate with and feel passionate about. It gives employees a sense of purpose in their work. Revolutionary innovations cannot take place without a sense of purpose in the beginning and achievement in the end. The skills and relationships of all its employees are valuable to the firm, and hence, the purpose of the firm guides the organization like a beacon of light. The vision, feeds life into the most inanimate of products and this is what motivates the people to innovate and bring about positive change in the lives of the consumers they serve.
4. Hear the revolution before feeling it: There are voices around who can make the next path-breaking change. Vandana Luthra began VLCC as a recation to the constant cribbing of people about the lack of right knowledge and tools to achieveing weight loss. People in companies can have innovative solutions to their problems but the top-down approach can inhibit them from expressing themselves. Hence, companies need to instate a mechanism for revolutionary ideas to reach the right ear and make a difference to the organization.
5. Have an open mind for ideas: This rule is applicable not for the company, but for the marketplace. The internal market for ideas exists and allows the formation and perpetuation of ideas for the organization to benefit as a whole. The reason behind the success of Bangalore as an IT hub is the breakdown of hierarchies that created an atmosphere for innovative ideas to germinate and a platform where they could be shared with the management. The organization has no prejudices about the capability of individuals or the stereotyped portfolios of innovators. Everyone who has ideas is accepted and allowed to present their thoughts to the organization. The most regular chores can lead to the most brilliant of ideas and they form the innovation wave for the next big thing.
6. Open market for capital: VC's and Angel investors are people who recognize the worth and potential for innovation and invest in the creation of the next big wave for change. While traditional financial firms have set notions of effectiveness and productivity of ideas, these people are eager to dirty their hands with the unknown and the unexplored. Also, capital is an essential requirement for innovations to take flight and see the light of the day that they have helped to create.
7. Open market for talent: People need to keep an open mind for creative potential. Efficiency and qualifications are mere signals as companies endeavour to segregate open minded, fresh ideas from mere academic excellence. Talent that adds value to the organization comes at a premium and it is the prerogative of organizations and investors to recognize the potential of talent and give it a fillip. Organizations can challenge people and truly talented people find innovative solutions to the company's challenge. However, talent is not mere restricted to academic qualifications and the market for talent is not essentially a market for employment.
8. Low Risk Experimentation: The answer to innovation lies between risk averseness that compels people to take the safe, well-trodden path and heady, dangerous ventures characterized by high risk and high returns. Portfolios help spread risks over multiple projects with relatively low probabilities of success but a high chance of atleast one succeeding. Even individually, they can generate dramatic returns.
9. Cellular division: Cellular division allows different business models to develop within the same organization and frees the human and capital resource to adopt it. It helps nurture thought and innovation as the companies then run as separate entities and the managers run almost independent businesses in the same organization. Innovation and flexibility grow in such an environment.
10. Personal wealth accumulation: The returns that a company gets out of successful innovations need to be shared with entrepreneurs and investors whose efforts have helped in materializing those gains. Wealth incentives are a way of keeping the innovator from switching companies and build a sustainable innovative base for growth and development in the long run.
These rules, if properly implemented, can pave the way for successful innovations.
Cheers!!!
Signing Off
Shauvik.
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