In this 1 minute PAREable, discover how companies can do everything right and still lose their market leadership.
- Have two innovation incubation models for an established firm.
- Observe how customers are actually using the product.
- Have discovery driven planning that is adaptable to various factors of change.
- Be creative at finding the right customers/market who can directly benefit from your innovation than a large, less targeted market.
- Expect trial and error, so a new organization can fail early and without great expense.
- Don’t develop products and services based on what customers say they would like.
- Don’t innovate in a singular quality, i.e., performance oversupply. What does innovation look like in functionality, reliability, convenience, and price?
- Established and entrant firms bring different types of innovations to market.
- Established firms bring sustaining innovations to maintain market positions and profit margins.
- However, they still lose market dominance because of their focus on sustaining profits while ignoring new markets brought by disruptive technologies.
- Knowing what the customers want through surveys, focus groups, and interviews is good at incremental improvement, not effective at creating the next thing.
- Tunnel vision chasing of profit margin should be moderated with long term expectations.
- The difficulty of predicting emerging markets means an established company can’t justify the investment. Thus, they usually miss out on disruptive technologies and the emerging market that comes with it.
- Sometimes, firms are just too inflexible with its RPV (Resources/Processes/Values) framework to adapt to changing conditions.
- Theoretical models for innovation rarely work in the real world.
- Disruptive innovations are usually variations on existing technologies that open up a new customer base.
- The best way for an established company to take advantage of a disruptive technology is to create or acquire an organization that is small enough with flexible processes.
Live and apply these ideas with the FREE Mindmory app!
Don’t just take my words, check out his book.
Until the next PAREable..