Disruptive innovation, entrepreneurship and organizational transformation
Disruptive innovation, entrepreneurship and organizational transformation
Disruptive innovation, entrepreneurship and organizational transformation
The transformation of a business is a very complex operation, but it is even more difficult when it involves a change of business model. Let’s look at why, with a simple example, that of Microsoft Office for its transition from a model of license sale to a model of selling subscriptions.
We live in a world of uncertainty and disruptions. To survive in this world, organizations should be agile. The word Agility is now everywhere. This would be the miracle solution to lack of innovation as it emerges every six months. But this is not the case. Agility is not what your organization needs for innovation. Let’s see why.
It is a story repeated many times: “Our transformation strategy is perfectly clear. But we have a big execution problem” as the member of the executive committee of a large multinational was telling me a few weeks ago. He added: “Now, disruptions are coming from everywhere, we spend millions on transformation plans, we put ‘digital’ and ‘startup’ everywhere, and nothing – nothing! – happens.” Implicitly, of course, and soon very explicitly, the explanation fuses: it is down below that people are incapable! Managers ‘down below’ are not ‘aligned’, so goes the explanation. They do not know how to execute. Or worse: they are resisting change. We must identify the culprits, the traitors! The plan must be executed!
There is a paradox in the field of innovation: everyone is in favor of it, I never meet a manager who explains to me that he does not want to innovate, quite the contrary; They all want to innovate. And yet in most companies, innovation is blocked. An important cause of this paradox lies in a conflict of commitment between the present and the future. Let’s look at it in more detail.
We live in an age which idealizes managers, yet never have these managers felt so powerless. Whatever their level in the hierarchy, they are confronted with increasing pressure in terms of control, reporting, senseless procedures, all resulting in a loss of autonomy which is immensely frustrating. As one of them was telling me recently “I have a superb company car, a personal assistant, a huge office in a very nice location in a great city, I am paid handsomely, feeling like Zeus on the tope of the Olympus, and yet when I want to buy a copier I need to ask the head office, and it’s not getting better. I am losing autonomy as time passes. All I’m doing more and more is filling Excel sheets.”
We often think that it will be enough to talk to the boss to solve the big problems of the organization. This is unfortunately false, and this often reflects organizational naivety and, above all, a refusal to take responsibility on the part of managers who have much more power than they think.
In a previous article, I discussed how we miss the potential of a new technology by holding it to a standard of perfection. I continue on the same topic by discussing how the initial low performance of a new technology explains why it is dismissed by incumbent players by taking the example of 3D Printing.
I wrote earlier about the loss of creative ability of the firm. This loss and the growing reliance on a command and control management style are obviously not without impact for an organization. In his political essay “The Power of the Powerless”, Vàclav Havel writes about a simple everyday experience he had in Czechoslovakia in the 1980s. In the window of a local grocery store, he observed a poster of the Communist party that read: “Workers of the world, unite!” Havel asked himself, “Why does the grocery manager do it? What is he trying to communicate to the world?” Obviously, the greengrocer was not a communist militant (in that era there were not so many around).
We often associate technology with disruption. We talk about disruptive technology all the time. But not every new technology is disruptive. Conversely, we often fail to imagine the impact of a new technology, especially in economic and societal terms. Let’s look at a simple example: pregnancy tests.
(more…)We hear a lot about “disruptive technologies,” but what makes an innovation disruptive is usually not its technical dimension, and the distinction often made between radical and incremental innovation is not so relevant. What matters is the disruptive nature of the business model created for the new technology.
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