Perpetual Innovation

Need to institutionalise a capacity for perpetual innovation. This involves understanding the degrees of unpredictability and taking calculated risks. More often than not, each change can threaten to undermine the historical sources of an organisation's profitability, yet each change needs to bring customers new benefits that have enormous payoffs, eg Schwab in the discount brokerage industry introduced a change from "bricks and mortar" to "cliques and mortar" (online business). This means working from the customer backwards.

Key elements for perpetual innovation are

- a passion

- a broader definition of business boundaries based on core competencies and assets such as the ability to move quickly, satisfy customer needs, the first to the market and leverage distribution channels

- a vibrant internal market for new, wealth-creating ideas where new voices have the chance to get heard

- an open market for talent, especially as many innovations that will affect your industry come from outside your industry

- highly motivated entrepreneurial staff who get to share in the wealth they create

- fluid organisational boundaries that allow skills and resources to be creatively and endlessly re-combined

- minimum number of restrictions, ie few rules and regulations

- working from the customer backwards

- using stretch goals

- encouraging innovation meritocracy

- rapid experimentation and prototyping

- encouraging genetic diversity within your organisation

- in a quickly changing world, do not allow allegiance (to a particular technology/product/ service/business concept) to stifle innovation

 

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