When Big Firms Are Most Likely to Innovate

When Big Firms Are Most Likely to Innovate

When Big Firms Are Most Likely to Innovate

Large, established companies get a bad rap for failing to be innovative. Conventional wisdom suggests that these firms are less likely to create path-breaking new technologies. Some argue this is because established firms are less likely to pursue radically new ideas—they get complacent or they don’t want to cannibalize their own success. Others claim that established firms may try to innovate, but are too set in their old ways to succeed.

In our research, we argue that it’s neither reluctance to pursue new technologies nor inability to think in new ways that limits established firms from developing new technologies. Rather, it’s when and where they choose to pursue such innovations that may sometimes be the problem. On the one hand, firms are most likely to pursue path-breaking innovation when their technological performance has fallen below their expectations. A firm that’s outcompeting its rivals may see no need to try something radically new; one that’s falling behind may be eager to look for a big breakthrough, especially if its performance is just slightly below expectations, so a big new discovery could push it over the hump.

On the other hand, attempts to develop path-breaking new technologies are most likely to succeed when undertaken from positions of existing strength. Organizations tend to perform better when they have strong capabilities—better scientists and engineers, effective product development processes, and strong brand names—and these advantages are not only likely to persist over time, they are also likely to be helpful even when pursuing more radical inventions. The better you understand the possibilities and limits of the old technology, the better chance you have of combining it with more distant knowledge to develop something really new.

Putting these two arguments together suggests a fundamental mismatch between the pursuit of path-breaking new innovations and their likelihood of success. Firms may be most motivated to go after radical new technologies when they are lagging (slightly) behind expectations, but they are most likely to successfully develop such technologies when they are technology leaders. Thus, firms that eagerly pursue path-breaking new technologies when their performance falls below expectations may be over-invested in looking for the next big thing, while firms that choose to play it safe because their performance far exceeds expectations may be under-invested in trying new things.

Our study explores this dynamic through a massive, long-term dataset of organizational patenting behavior from 1980-1997. Starting with every US patent filed, we look for patents that make truly novel connections—bringing together technology areas that have rarely, if ever, been linked before. For example, if research in power generation hadn’t typically drawn on knowledge about gas separation (largely true before the 1990s), then a new patent using gas separation to innovate in power plants would represent a novel connection. We then look at a) which firms are most likely to introduce such patents, and b) which of these “radical” patents are most likely to have substantial impact, where impact represents a breakthrough patent that is among the 5% most highly cited patents in the same technology class and year (a common, non-commercial measure of patent success).

Our results show strong support for our theory about the mismatch between motivation and ability: firms are most likely to introduce “radical” patents when their prior technological performance has been just below their aspirations, but such patents are most successful when introduced by firms performing substantially above their aspirations. Further, we find that this mismatch is especially pronounced in large, multi-technology firms—the more technological areas you compete in, the more eager you are to try radically new things in areas where you’re falling behind, and the less eager to mess with those technologies that are doing well.

What does all this mean? First, it means that stronger firms need to fight against the biases that sap their motivation to be innovative. This often means building a culture and incentive system where experimentation and even failure are tolerated and encouraged. Since innovation is typically very risky, if failure is seen as a black mark on someone’s record, most employees at successful firms will shy away from innovation and stick with safer, incremental projects. This is what firms like Apple and Google have discovered and done so well — they’ve been willing to take risks and try new things even when they are highly successful, and have found ways to encourage innovation among high performing employees who would otherwise be content to play it safe.

Second, it means that struggling firms need to be very careful. Their inclination may be to take bigger risks, but senior managers need to recognize that such efforts are likely to fail. Going after the next big thing in the hope that it will stem the rot is not a solution; instead, managers need to try and address the lack of key capabilities that caused them to struggle in the first place. Only after they’ve identified and fixed the problems that caused their performance to decline can managers realistically hope to pursue path-breaking new technologies.

Finally, our study suggests that managers may need to revisit how they allocate R&D resources across technology areas. While it may seem reasonable to play it safe in areas where you’re doing well while going for big wins in areas where you’re doing badly and have less to lose, firms would be more likely to develop path-breaking new technologies if they actively shifted resources to the high performing technology areas, while cutting back on search in the areas where they’re struggling.

Overall, our study shows that while large, established firms do actively pursue path-breaking new technologies (accounting for the lion’s share of patents that make radical new connections in our study), they would have more success doing so if they went after such technologies from positions of existing strength, instead of only trying for the next big thing in times (or in areas) where they are starting to fall behind.

“If it ain’t broke, don’t fix it”, the saying goes, but it’s precisely by trying to fix things that aren’t broken that firms can raise their odds of staying ahead. If you wait till it’s broken, it may be too late to fix.

When Big Firms Are Most Likely to Innovate

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Want to Boost Innovation? Here Are the 3 Books You Need to Read Next

Want to Boost Innovation? Here Are the 3 Books You Need to Read Next

Want to Boost Innovation? Here Are the 3 Books You Need to Read Next

The curator for business, history, and social sciences at The New York Public Library shares his favorite reads for boosting creativity.

While necessity is said to be the mother of invention, innovation is the engine driving personal growth, creativity, and startup success. While some people are quick to innovate, creativity and out-of-the-box thinking are skill sets that can be cultivated and taught.

If you are looking for good reads on the subject, you can crowdsource recommendations by checking out Amazon’s bestseller list and best-rated titles. Among the books featured are Harvard Business Review’s 10 Must Reads on Innovation by Peter F. Drucker; The Innovator’s Mindset: Empower Learning, Unleash Talent, and Lead a Culture of Creativity by George Couros; and Innovation Tools: The Most Successful Techniques to Innovate Cheaply and Effectively, by Evan Shellshear.

Another option is asking a single person for recommendations. What better expert to suggest books on a topic than a professional librarian. I reached out to John Balow, who is curator for business, history and social science at The New York Public Library, for his top three picks for people who want to boost their creativity and create a mindset and environment that bolsters innovation. Here is what he shared, along with some thoughts on what makes these his “top shelf” picks.

1. Sprint: How to Solve Big Problems and Test New Ideas in Just Five Days by Jake Knapp, John Zeratsky, and Branden Kowitz

Sprint is co-authored by three partners at Google Ventures — Jake Knapp, John Zeratsky, and Braden Kowitz. The book prescribes a five-day process for testing ideas and solving problems. It is divided into five main sections, each one detailing a day in the five-day process. One of the things Balow likes best about this book is its universal application. “The practical steps can be applied to companies of any size or intention, from startups, to large, established corporations, to nonprofits,” he explains. He also praised the book’s voice, which is extremely accessible. “The brisk, lighthearted tone perfectly matches the subject matter, as does the format.”

2. Happiness Track: How to Apply the Science of Happiness to Accelerate Your Business by Emma Seppälä

One would not necessarily associate happiness with innovation, but there is a reason Balow includes it in his top-three picks. “Drawing upon cognitive psychology and neuroscience, Seppälä, who is science director of the Center for Compassion and Altruism Research and Education at Stanford University, disputes commonly held notions of success as both outdated and counterproductive. She offers practical advice to increase happiness, and in turn, bolster professional satisfaction,” Balow explains. Backed by scientific research, Happiness Track offers insights for changing the way we approach our work and non-work lives. “It teaches the reader how to thrive professionally without sacrificing authenticity and moral values.” This focus helps build an emotional environment conducive to true innovation driven by satisfaction and camaraderie.

3. Small Data: The Tiny Clues That Uncover Huge Trends by Martin Lindstrom

Balow describes this book as “Part Margaret Mead, part Sherlock Holmes, part Woodward and Bernstein” adding: “It is a truly singular business book.” To write this book, Lindstrom spends 300 nights in strangers’ homes observing their every action to discern what motivates them, and ultimately consider what these data mean in the marketplace. Balow likes this book because “Lindstrom’s methodology is disrupting market research and getting to the details usually missed by big data analysis.” The book is filled with examples of how observed human behavior led to revolutionary redesigns and product launches. For example, the author explains how a worn out sneaker changed LEGO, and how a teddy bear changed the design of 1,000 retail stores worldwide. “By uncovering the unexpected experiences and connections that have caused some of the most successful brands in the world to innovate and adapt, the author leaves readers looking at the world around them with much more appreciation for their own small inspirations and epiphanies.”

When it comes to innovation, making new connections, thinking about things differently, and being exposed to new ideas gets the juices flowing. Who knows? Perhaps your next big idea lies just beyond the pages of one of these fascinating books.

Want to Boost Innovation? Here Are the 3 Books You Need to Read Next

4 Ways to Gain Success Through Safe Innovation

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4 Ways to Gain Success Through Safe Innovation

Success comes on the leading edge, not the bleeding edge. Learn how to mitigate risk while stretching to new heights.

Innovation can be risky for any successful company. Most leaders want the progression of innovative thinking, but many also believe there is no need to rock a steady ship and potentially create unneeded turmoil.

Innovation doesn’t always have to be a risky proposition. On a recent episode of my podcast, YPO’s 10 Minute Tips from the Top, I interviewed NK Tong who is successfully innovating in one of the oldest professions, real estate.

As co-founder and group managing director of Bukit Kiara Properties in Malaysia. Tong is challenged daily with finding new concepts and ideas for buildings to not only give his customers more value, but to also keep the creative fuel running inside of his company.

Tong, a member of the YPO, is an MBA graduate from Wharton School of Business who built his company up from a team of five people to one with development properties worth over 375 million euros in Malaysia alone.

Here is Tong’s advice on innovating safely but surely.

1. Get your whole team involved.

Coming up with big ideas on your own is a tall order, especially when you need to innovate constantly. Tong’s method? Bring in the whole team. “I believe in the wisdom of crowds,” he noted. His company has very specific methodology. They bring in around 40 people into a meeting, dividing them up into seven groups. Each group comes up with different ideas that are then pitched to the entire staff using mind maps. The ideas are then revisited two to three weeks later with a more focused group of the lead creatives in the company and they eventually talk through the differing ideas until they believe they found one that fits the bill, even if it feels outlandish. “After 20 minutes, the idea that initially seemed ridiculous became the central idea.”

2. Stay close to the customer.

No matter how great an idea is, it will mean nothing if the customer finds it lacking in value. Tong’s company’s approach is to stay close to the customer.”On any project, we have 60 percent of the company involved in sales,” he explained. “On weekends, different team members from all departments get involved in sales. So the whole company then knows the customers because they have met the customers. They feel aligned with the customer.” They then create with the customer in mind. But the interaction does not end there as Tong’s team keeps in touch with customers on social media, creating Facebook groups that allow customers to interact with the company and other tenants. “Of course there are residents who will complain about issues on the ground. And we love that because if we can get instant feedback, then we can do something about that. It also gives us feedback on how the team’s doing,” acknowledged Tong. “But more importantly, it also creates sense of community so that they can get in touch with each other.”

3. Begin with the end in mind.

New and even radical ideas are crucial to the growth and innovation of a company. Tong advocates seeing the big picture first and working backward so you can identify the essential building steps. This approach also surfaces the potential pitfalls that could cause you grief later on. “We have to be careful to be on the leading edge, not the bleeding edge because that can be very expensive,” asserted Tong.

4. Be open to new ideas in the moment.

When executing an innovative and potentially risky plan, deviating from the structure in place could be challenging and seen as unsafe. But taking those risks at the right moment could potentially pay off as well. “We still shoot bullets before cannonballs,” revealed Tong, referencing Jim Collins’ Great by Choice. “When we go onsite, we will look around and if we see opportunities for improvements, sometimes these changes or improvements don’t add to cost but add to customer experience.”

4 Ways to Gain Success Through Safe Innovation

The Innovative Coworking Spaces of 15th-Century Italy

The Innovative Coworking Spaces of 15th-Century Italy
Coworking spaces are on the rise, from Google’s “Campus” in London to NextSpace in California. Much has been made of these shared workspaces as a brand-new idea, one that barely existed 10 years ago. But the way they function reminds me of a very old idea: the Renaissance “bottega” (workshop) of 15th-century Florence, in which master artists were committed to teaching new artists, talents were nurtured, new techniques were at work, and new artistic forms came to light with artists competing among themselves but also working together.

The Renaissance put knowledge at the heart of value creation, which took place in the workshops of these artisans, craftsmen, and artists. There they met and worked with painters, sculptors, and other artists; architects, mathematicians, engineers, anatomists, and other scientists; and rich merchants who were patrons. All of them gave form and life to Renaissance communities, generating aesthetic and expressive as well as social and economic values. The result was entrepreneurship that conceived revolutionary ways of working, of designing and delivering products and services, and even of seeing the world.

Florentine workshops were communities of creativity and innovation where dreams, passions, and projects could intertwine. The apprentices, workers, artisans, engineers, budding artists, and guest artists were interdependent yet independent, their disparate efforts loosely coordinated by a renowned artist at the center — the “Master.” But while he might help spot new talent, broker connections, and mentor younger artists, the Master did not define others’ work.

For example, Andrea del Verrocchio (1435–1488) was a sculptor, painter, and goldsmith, but his pupils weren’t limited to following his preferred pursuits. In his workshop, younger artists might pursue engineering, architecture, or various business or scientific ventures. Verrocchio’s workshop gave free rein to a new generation of entrepreneurial artists — eclectic characters such as Leonardo da Vinci (1452–1519), Sandro Botticelli (1445–1510), Pietro Perugino (c. 1450–1523), and Domenico Ghirlandaio (1449–1494).

What can those who want to create more innovative and collaborative workplaces today — whether that’s a better office in a traditional organization, a coworking space, a startup incubator, or a fab lab — learn from the workshops of the Renaissance? The bottegas’ three major selling points were turning ideas into action, fostering dialogue, and facilitating the convergence of art and science:

Turning ideas into action. Renaissance workshops were not just a breeding ground for new ideas; they helped ideas become reality. Likewise, today’s innovative workplaces need to be equipped with everything people need to turn their insights, inspirations, and mental representations into new products and ventures. Coming up with new ideas is hard enough, but the real challenge for many organizations is figuring out how to exploit them and turn a profit. 

Fostering dialogue. Ferdinando Galiani, a Neapolitan economist of the 18th century, argued that markets are conversations. The quality of the network — that is, the combined intelligence of people and organizations with different skills and abilities — plays a critical role in innovation.

In Renaissance workshops, specialists communicated with each other consistently and fluidly, facilitating mutual understanding. The coexistence of and collision among these diverse talents helped make the workshops lively places where dialogue allowed conflicts to flourish in a constructive way. The clash and confrontation of opposing views removed cognitive boundaries, mitigated errors, and helped artists question truths taken for granted.

Today, we often recognize the need for these kinds of illuminating conversations without really making space for them in our organizations, either because organizations are too afraid of conflict or because people are simply too busy to try to expand their understanding of each other. But Renaissance workshops offer proof of how important it is for collaborative workplaces to draw on sources of opposing ideas and controversial opinions.

Facilitating the convergence of art and science. While often remembered as primarily artistic today, in truth the Renaissance workshop was transdisciplinary. This helped create a holistic approach to creativity, which stands in opposition to our own organizations, in which people in different specialties are often separated into silos.

For example, during the Renaissance nature was seen as a convergence of art and science, as in the famous “Vitruvian Man” drawing by da Vinci. Many of today’s most exciting business opportunities are similar meetings of technological advances and aesthetic beauty. Bringing these disciplines together fosters mutual learning through experiments that lead to business opportunities.

Whether you are running a coworking space or trying to get your own organization to be more creative and collaborative, think about some of the ways you might follow the example of a Renaissance workshop.

The Innovative Coworking Spaces of 15th-Century Italy

Now Is the Time to Revisit Disruptive Innovation

Now Is the Time to Revisit Disruptive Innovation

Now Is the Time to Revisit Disruptive Innovation

Few business concepts have been as long and widely used as disruptive innovation, first introduced by Harvard Business School professor Clayton Christensen in a 1995 Harvard Business Review paper co-written with Joseph Bower, and later elaborated on in 1997′s The Innovator’s Dilemma.

But as often happens with serious ideas once they become popular, disruptive innovation has joined the pantheon of trendy, overused business buzzwords, stretched and applied way beyond its intended meaning. It’s even led to a rather strong backlash in a 2014 New Yorker article by Harvard history professor Jill Lepore.

In the middle of this backlash–coming, ironically, at a period when we seem to see nothing but disruptive innovation all around–Mr. Christensen revisits his original concept in What is Disruptive Innovation?, co-written with Michael Raynor and Rory McDonald, and just published in HBR’s December issue. The authors aim to define what disruptive innovation is and what it isn’t, as well as to update the theory based on the experiences of the past two decades.

“Unfortunately, disruption theory is in danger of becoming a victim of its own success. Despite broad dissemination, the theory’s core concepts have been widely misunderstood and its basic tenets frequently misapplied. Furthermore, essential refinements in the theory over the past 20 years appear to have been overshadowed by the popularity of the initial formulation. As a result, the theory is sometimes criticized for shortcomings that have already been addressed.”

What’s disruptive innovation all about? The paper succinctly defines disruption as “a process whereby a smaller company with fewer resources is able to successfully challenge established incumbent businesses.” In the past 10 years I’ve given a number of seminars and a few course on innovation, so let me also address the question in my own words by first explaining the distinction between disruptive and sustaining innovations.

Sustaining innovations are incremental improvements to existing products and services, often in response to the requirements of a company’s most demanding and profitable customers. Disruptive innovations, on the other hand, start life as simpler, more convenient, less expensive good enough offerings. They appeal to new or less-demanding customers whose needs have not been served by incumbent providers, mostly because they’re not as profitable as their present customers.

What makes disruptive innovations dangerous to incumbents is that, if allowed to gain a market foothold, they can get on a learning curve of rapidly improving quality and capabilities while preserving the lower prices and/or ease-of-use that drove their early success. They might well end up creating new markets and toppling the incumbents from their leadership position. “When mainstream customers start adopting the entrants’ offerings in volume, disruption has occurred.

Distinctions between disruptive and sustaining innovations are sometimes tricky. It’s rare that a new offering is inherently one or the other. It often depends on the strategies adopted by the various companies involved and on the dynamics of the marketplace.

Uber Technologies Inc. is a case in point. Everyone will agree that Uber’s phenomenal growth is transforming the taxi industry around the world. “But, is it disrupting the taxi business?” While many would say that Uber is obviously a disruptive innovation, Mr. Christensen et al disagree. As they explain, Uber is actually more of a sustaining than a disruptive innovation for two main reasons:

“Disruptive innovations originate in low-end or new-market footholds.” Uber didn’t originate as either a significantly less expensive, low-end alternative to taxis, or as a service for people that never took them before. In fact, most of Uber’s early customers were generally people used to taking taxis. It first provided a more convenient solution in mainstream markets, and only later, has it expanded to offer rides in under-served neighborhoods.

“Disruptive innovations don’t catch on with mainstream customers until quality catches up to their standards.” This was not the case with Uber. From its beginning, Uber competed head-on with existing taxi services, making it easier to get a taxi using Uber’s smartphone app and not having to worry about payments. Moreover, the rating approach used by Uber ensured higher standards than with typical taxis. These innovations are sustaining in nature, the kinds of innovations that established taxi companies should have implemented themselves to better serve their existing customers.

“Why does it matter what words we use to describe Uber?” asks the paper. “The company has certainly thrown the taxi industry into disarray: Isn’t that disruptive enough?”

If disruption is a real business theory rather than a marketing term for anything new, it must be applied correctly to realize its benefits. This isn’t easy, as the Uber example shows. The paper discusses four points about disruption that have been often misunderstood:

Disruption is a process. It should not be used when referring to a product or service at a specific point in time, but rather to the expected evolution of that offering over time. There is a difference between a small competitor with an interesting offering and one with a potentially disruptive trajectory that over time could become a big competitive threat.

Disrupters often build business models that are very different from those of incumbents. Apple’s App Store is used as a prominent example. “By building a facilitated network connecting application developers with phone users, Apple changed the game. The iPhone created a new market for internet access and eventually was able to challenge laptops as mainstream users’ device of choice for going online.”

Some disruptive innovations succeed; some don’t. This is a common mistake. If an innovative business succeeds, as has been the case with Uber, people assume that it must thus be disruptive. Many startups fail to win a foothold in the market even though their innovation is truly disruptive. And others succeed against entrenched incumbents through superior operational innovations that are sustaining in nature.

The mantra “Disrupt or be disrupted” can misguide us. This is a very important point for established companies. Successful companies – especially market leaders being chased by small and large competitors – must achieve a delicate balance between carefully managing their existing operations, and embracing disruptive innovations that will propel them into the future. But each requires a very different management style. “Our research suggests that the success of this new enterprise depends in large part on keeping it separate from the core business. That means that for some time, incumbents will find themselves managing two very different operations,” they write.

“We still have a lot to learn… and much work lies ahead…” write the authors in conclusion. “Disruption theory does not, and never will, explain everything about innovation specifically or business success generally. Far too many other forces are in play, each of which will reward further study. Integrating them all into a comprehensive theory of business success is an ambitious goal, one we are unlikely to attain anytime soon.”

Irving Wladawsky-Berger worked at IBM for 37 years and has been a strategic advisor to Citigroup and to HBO. He is affiliated with MIT, NYU and Imperial College, and is a regular contributor to CIO Journal.

WSJ

Now Is the Time to Revisit Disruptive Innovation

Thinking ahead: 5 ways to future-proof your company

Thinking ahead: 5 ways to future-proof your company

This article is part of DBA, a series on Mashable about running a business that features insights from leaders in entrepreneurship, venture capital and management.

When innovating for the future, many people find inspiration in a famous quote attributed to Henry Ford: “If I had asked people what they wanted, they would have said faster horses.”

Whether or not Ford actually said these words, the premise is wrong. Ford’s customer base might not have invented automobiles on their own, but they did know they wanted a faster, reliable and more comfortable way to get from point A to point B. They needed Ford to come up with the right solution.

We often talk about innovation solely in the context of bleeding-edge technology, but technology is simply a tool to help you solve your customers’ problems. Future-proofing your company requires putting yourself in the customers’ shoes and building your business around their needs. Here are five tips to prepare your company for the future.

1. Fixate on the problem

Fixate on the problem

Innovation grows from understanding what your customers want to achieve and why. Watch how your customers use your product to determine how you can best solve their problem. If you try to achieve this outcome, you’ll move away from developing features for the sake of adding bells and whistles.

For example, Apple’s click-wheel interface on the first iPod solved a problem for its users by giving them a way to quickly and easily navigate hundreds of files on a small screen. Apply this outcome orientation to your strategy by observing, listening and soliciting customer feedback.

2. Think beyond your core product

We live in a service economy in which companies have transcended selling products; they’re now selling experiences.

Think about how you can add value to your customers and help them achieve their desired outcome through the holistic experience you provide.

For example, Hilton Hotels recently revamped its HHonors app, so customers can choose a hotel, preview their room and book a stay via the mobile app. When they arrive at the hotel, they bypass the check-in counter and seamlessly enter their hotel room using near-field communication (NFC) on their smartphones. Hilton Hotels is differentiating its brand in a crowded industry and giving its customers more control to personalize their hotel stay

3. Build in an open way

Build in an open way

New products or features don’t always work the way customers want them to. Even if it meets your customers’ needs today, those needs and pain-points will likely change over time.

When it comes to software companies in particular, it’s important to build technology that’s flexible and doesn’t paint your customers into a corner. Make sure your product can integrate with other existing solutions as well as those that might emerge in the future. Your technology should always be able to evolve along with your customers and their needs.

4. Stay plugged into the market

Whether you’re just getting started in your industry or you’ve been involved in it for decades, it’s important to stay immersed in your market. Stay in touch with other entrepreneurs, follow your competitors and use social media to follow influencers in your space.

Beware of the “Founder’s Dilemma”– don’t get caught up in wealth or control. Stay connected to what’s happening in your industry and commit to delighting your customers.

Engage with partners to learn more about your customers and how they’re using technology. Ask questions and crowdsource ideas. There’s still no substitute for in-person interactions, so attend events and meet with your customers face-to-face. They’ll appreciate the face time and you’ll gain further insights into how best to serve them.

5. Inspire employees to innovate

Everyone has good ideas about how to expand a product and innovate. The leaders at future-proof companies understand that a strong company culture helps surface these ideas and spur innovation. Build a culture that aligns employees around a strong mission, values clear communication and encourages people to pursue their creative ideas. Set aside time for experimentation and empower employees to get involved in projects and jobs outside of their typical role.

Don’t focus all of your time, energy or resources on a single strategy for future-proofing. Instead, divide your energy between these three activities:

  • Listening: Fulfilling customers’ requests for certain features and improving your product
  • Connecting: Understand the market and your competitors
  • Experimenting: Looking ahead at opportunities for the products and services your customers don’t yet know they need

Balancing these three things (paying attention to your customers, keeping your pulse on the market and innovating ahead of the market) will prepare your company for tomorrow and the years ahead. As you work to do so, however, don’t lose sight of your mission to create better outcomes for your customers.

Your customers are both the problem and solution when it comes to future-proofing your company. Technology is the screwdriver that will help you get there.

Mashable

 

Thinking ahead: 5 ways to future-proof your company

The 15 most innovative countries in the world

The 15 most innovative countries in the world

Since 2008, Cornell University, INSEAD, and the World Intellectual Property Organization have released the annual Global Innovation Index.

Basically, it’s a list of the most innovative countries in the world.

This year’s winners are no strangers to the top of the list, dominating in seven general categories: research, infrastructure, institutions, market and business sophistication, and a commitment to knowledge and creativity.

The most innovative countries teach creatively, enforce progressive laws, do business intelligently, and live on the cutting edge.

Keep scrolling to find out which countries will lead us into the future.

15. New Zealand — A growing reputation for innovation in the film industry, namely with its use of drones, keeps the country ranked highly.

15-new-zealand-a-growing-reputation-for-innovation-in-the-film-industry-namely-with-its-use-of-drones-keeps-the-country-ranked-highly

14. Republic of Korea — The GII says South Korea’s greatest growth is in its booming research and development sector.

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13. Iceland — A country bouncing back from financial woes is making storage of the world’s internet data its primary goal.

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12. Germany — The country ranks at the top of national office patent applications and technology output, namely, automobile tech.

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11. Hong Kong — Though it dipped one spot since last year, Hong Kong is playing an ever-expanding role in the world’s economy.

11-hong-kong-though-it-dipped-one-spot-since-last-year-hong-kong-is-playing-an-ever-expanding-role-in-the-worlds-economy

10. Denmark — Denmark leads for its efficient system of government, large number of researchers, and quality of education.

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9. Luxembourg — The tiny country’s ninth-place rank comes from its high scores in the Trade and Investment categories. Education also boosts its rank.

9-luxembourg-the-tiny-countrys-ninth-place-rank-comes-from-its-high-scores-in-the-trade-and-investment-categories-education-also-boosts-its-rank

8. Ireland — Up three places since 2014, Ireland is recognized for its infrastructure and creative outputs, like its thriving design culture.

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7. Singapore — One of the most consistent countries, Singapore stands out for its political environment and ecological sustainability.

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6. Finland — Down two spots since 2014, Finland is still recognized for its work in technology, research, and higher education.

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5. United States — The US jumped five spots since 2012, most notably for the strength of its global-facing markets, value of stock trades, and widespread implementation of internet technology.

5-united-states-the-us-jumped-five-spots-since-2012-most-notably-for-the-strength-of-its-global-facing-markets-value-of-stock-trades-and-widespread-implementation-of-internet-technology

4. Netherlands — With its strong online culture, the Netherlands ranks at the top of the survey’s “e-participation” rankings (for interacting with the government online), and near the top in research and technology outputs.

4-netherlands-with-its-strong-online-culture-the-netherlands-ranks-at-the-top-of-the-surveys-e-participation-rankings-for-interacting-with-the-government-online-and-near-the-top-in-research-and-techn

3. Sweden — Well-designed universities and high-achieving graduates have kept Sweden in the top 3 for the last four years.

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2. United Kingdom — Education and productivity hold the UK back, GII says, while its well-roundedness in all other aspects keeps it ranked high overall.

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1. Switzerland — The country has been number one since 2011 because of its knowledge-based economy and ability to turn innovative thinking into lucrative projects — for example, local bank UBS is now using virtual reality to project investment portfolios to clients.

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The 15 most innovative countries in the world

Fashion Thinking – 5 Ways To Innovate Your Business Strategy

This Fashion Thinking framework will unleash all kinds of ways to anticipate the new and remix the old.

If your goal is to be an organization that can fluidly and flexibly adapt to complex environments, then consider incorporating elements of Fashion Thinking. This is increasingly important as customers expect companies to incorporate digital technology that makes the shift from providing physically fixed products to just-in-time products and services. Here are 5 elements of Fashion Thinking.

  1. Span Time–Fashion has a temporal dimension. If it is too far in the past, it’s costume; too far into the future and people don’t get it. It works very hard to capture that ever-changing, in flux present moment. The ability to be aware of that temporal range helps fashion firms to anticipate needs and do productive risk taking. How might your firm look to the past while incorporating social trends to innovate?
  2. Build Bridges–Fashion also has a spatial dimension. It straddles cultural boundaries and taps into both “the street and the elite” for inspiration. Be curious about other cultures, geographies and inclinations. By opening themselves up to those that are afar and different from them, fashion designers help bridge gaps between a range of people and traditions and ultimately point out our interconnectedness. Remember that whatever your sector, your product/service is solving not only a functional job, but also a social and an emotional one. This is a reality to which fashion designers are well attuned.
  3. Re-Mix and Embrace Collage–Fashion designers are creatively resourceful “bricoleurs”: they relish in the ability to make something new out of nothing. Have you accepted yet that nothing is truly new, and that the new model for work is the collage and the re-mix? Invest in trend research and explore with whom you can unexpectedly partner to put a new spin on, say, your non-profit venture.
  4. Harness Technology and Human Sensibility- Urgent & timely responses to people’s desires is essential in fashion. Fashion firms do this in two ways: the old fashioned way by having people on the ground, in the streets and nightclubs, tapping into sub-culture; and the new ways by using technology, fancy algorithms and iBeacons to track shopping behaviors. Fashion retail is one of the most fascinating hubs of experience design today. Suspend judgment and take a field trip into an Abercrombie & Fitch store, and just observe the layers of sensorial design, technology and human interaction at work.
  5. Open Source & Co-Create–Fashion is excellent at being the disruptor in disruptive innovation and is the original open source innovator. Given the layered psychodemographic market demands and the complex apparel supply chain, this open- and crowd-source orientation is a necessity. Johanna Blakley discussed in her TED talk how fashion’s knock off culture has actually been a source of innovation and sales growth- especially when compared to laggard industries such as publishing and music where disruptive innovation has hit like a tsunami. Social media is your friend to be attuned to what your customers actually care about and it gives you a platform to co-create.

By adopting Fashion Thinking you will become an expert in pattern recognition and your business will be a tastemaker. Integrate aesthetics and function, agile supply chains and anticipate customer needs through technology. These realities are the balancing act that makes Fashion Thinking an essential lens.

Fashion Thinking – 5 Ways To Innovate Your Business Strategy