Innovation Realized: how business can harness the power of digital disruption
To stay relevant in a changing world takes fresh thinking. We gathered select business leaders to explore how best to drive innovation
On 24-25 April 2017, in two circus tents on an old naval base near San Francisco, we held our annual Innovation Realized event. And the two days’ intense discussions on how to make innovation real has made my head buzz with new ideas.
As you may have guessed from the circus tent venue, Innovation Realized is a business retreat with a difference. There was no conference hall and no lectures. Instead, we brought executives and digital entrepreneurs together to brainstorm arguably the biggest issue facing business today: how to harness the full power of the digital revolution currently transforming society.
One of the thought leaders at Innovation Realized was Brett Crosby, formerly Head of Marketing for Google Analytics and now Co-Founder and COO of real estate debt platform PeerStreet. He argued that with disruption everywhere, businesses have a huge opportunity to reinvent themselves — not just how they use technology, but also how they portray their story and the story of their employees.
He suggested some key questions that business leaders should ask themselves:
- How can you take what you are doing and make it have greater impact on both your organization and your customers?
- What role can you play in preventing a backlash against technology?
- How can you make the world a better place?
The best CEOs embrace being wrong, because the faster they recognize their faulty thinking, the faster they reframe their questions and unlock better solutions.
Professor Hal Gregersen, Co-Author of The Innovator's DNA and Executive Director of the MIT Leadership Center
So, what more did we learn at Innovation Realized? Find out more by watching this brief video.
Three strong themes emerged from the event:
Dual strategy — a strategy for both today and tomorrow
Many participants felt strongly that we now need to think in terms of dual or parallel business strategies — one for today and another to position our business for the challenges of tomorrow. I often describe this as the difference between “being” and “becoming” — each requiring a different approach.
Vanessa Collela, Chief Innovation Officer at Citi, pointed out that traditional businesses have historically built their strategies for a world that was more stable. So it is hard to for them to rebuild their strategies for an unstable world driven by unpredictable technology and geopolitical change.
What does this new world mean for businesses and customers, products and services, and interactions between different parties? Businesses must be ready to adjust their strategies more frequently and in whole new ways.
Tim Kobe, Founder and CEO of Eight Inc., observed that for most people change is “a terrifying thing.” He noted that humans tend to be “change resistant,” a characteristic that leaders should consider when driving change in an organization. Sometimes we have to “break the existing system to build a new future,” he added. He also suggested that it is better to not wait for the “unknown” but instead to actively build the strategy toward the “next known.”
Adapting to superfluid markets
Connectivity is bestowing digital identities on physical items such as phones, power meters and refrigerators, which are becoming “smart” enough to interact with each other via networks. As a result, there is huge potential to reduce transaction costs and identify inefficiencies.
Participants recognized that some markets are turning “superfluid” — with the traditional frictions of doing business all but disappearing. And new ideas and technologies are reducing the friction and viscosity of markets across all sectors.
We see this in the mobility space, with the rise of Uber and Lyft. It is also evident in the new ways that talent demand is connecting with labor supply — for example, through social media platforms and online marketplaces such as PeoplePerHour and blur.
But which industries will become superfluid next? Many at the event thought the construction industry was ripe for change.
Combining creativity and technology
Creativity and design thinking (a methodology used for solving complex problems) are critical in helping people to deal with the far-reaching changes that are currently happening all around us. Participants emphasized that processes and technology must be humanized — not just for customers but also for employees.
Janet Balis, our Digital, Customer and Strategy Advisory Leader, Media & Entertainment, put it this way: “Data is not the sole driver of a successful business. Future success will be determined by how organizations combine creativity and data. It’s all about creating a great human experience, including through seamless workflows between humans and machines.”
Participants also suggested that if organizations are to prosper in future, they need to think of themselves as ever-changing organisms within a wider ecosystem. So increasingly, we need to figure out how our organizations can become good hosts, creating new collaborations and knowledge sharing. Not only do we need to make it easier to share ideas within the organization, we also need to build in permeability from the outside.
Ideas for action
Here is a set of suggested actions for those that lead organizations through today’s changes:
- Develop a deliberate dual strategy — and communicate it to the organization
- Work out whether, and how, superfluidity affects your industry, and look for opportunities to take the friction out of supply and demand
- Recognize the need for faster response times in a quickly changing environment
- Reduce the gap between what those in leadership think is happening and what is really going on in your business — get fully connected to those serving your customers on the ground and listen
- Use a highly structured approach to driving innovation — focus on establishing the right frameworks, rather than on just creating free space
- Remember that progress is about people, not just machines — and don’t forget that you need the right mix of both talent (new and old) and technology to pivot to new business models
Finally, Professor Hal Gregersen, Co-Author of The Innovator's DNA and Executive Director of the MIT Leadership Center, reminded us how important it is to get out of our comfort zones and seek opportunities to really listen. As he observed: “No successful CEO or country leader is right 100% of the time. The best CEOs embrace being wrong, because the faster they recognize their faulty thinking, the faster they reframe their questions and unlock better solutions.”