here’s no getting around it. Innovation is hard. It is one of the rare business activities that does not benefit from economies of scale. That is, large businesses are no better at it than small ones—and, in fact, are often worse. But the notion that brilliant individuals, using mysterious methods, create all the radical innovations is a myth. Implicit in the myth is the idea that innovation is beyond the reach of process improvement and discipline, and is impervious to management influence (other than management throwing more money at research and development [R&D]). But consider three hallmark examples:
- Edison’s light bulb—Thomas Edison didn’t arrive at the solution of tungsten filaments in a vacuum through once-in-a-lifetime insight. The basics of making a light bulb were known: pass electricity through a filament in a vacuum. The problem was the filaments he had tried did not last long. Edison’s genius was dedicating scores of engineers to systematically testing thousands of materials as filaments. Eventually, they discovered tungsten lasted longest. Edison brought the idea to cash through a disciplined process to solving a problem.
- Google’s Web search algorithm— Larry Page, co-founder of Google, was using the Alta Vista search engine to find e-commerce Web sites and encountered the problem of search results being plentiful but of limited value because they were not ranked by relevance. He connected two patterns: the importance of the web of links among Internet sites, and the way academics use journal citation counts to measure the importance of articles. Then, using the number of links among pages to determine which are seen first, he transformed Internet search. Page did it intuitively, but connecting two patterns from dissimilar domains can be used as a formal process to accelerate invention.
- Apple iPod—Apple released the iPod in 2000 to middling success, despite its creative combination of many smaller inventions resulting in an elegant portable music player. The problem: the digital music ecosystem was in chaos. Songs illegally ripped and shared on the Internet often were mixed with malware, there was no single place to buy tracks legally, and moving music between multiple sources and the iPod presented complex challenges. Apple soon made one additional, incremental invention to unlock the vast commercial success latent in MP3 players: iTunes as a safe, legal, and user-friendly way to get music to the device. Neither iPod nor iTunes by itself was radical innovation, but together they changed the game.
There are lessons here that all leadership teams need to take to heart.
“While innovation can be groundbreaking, it is more often the incremental improvements of existing technologies and methods—the sum of many small but constant changes that over time can transform the way a company or an industry does business,” says Jon Bidwell, chief innovation officer of Chubb, for whom the end-to-end innovation process goes from idea to marketable products.
Innovation is high on the agendas of CEOs in virtually any industry. In the past, they might have focused on growing market share to drive growth. Now, they increasingly are focusing on innovation in new
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