Can mature companies still be invasive when it comes to innovation?
Henry King wrote a good article talking about eight principles that business/design innovators can learn from invasive species. He concludes by talking about qualities that businesses need to stay invasive. However, he does not cite any cases of companies that have avoided falling into the “defend market share” mode once they succeed as market innovators. When asked about this, he replied,
Although I’m not a Steve Jobs devotee I do think that Apple is perhaps more innovative now than it’s ever been and has very successfully invaded at least three industries in the last decade: media distribution, which the record companies used to own; media consumption, which Sony used to own; and mobile telephony, which Motorola and Nokia used to own (although this is still a new industry and therefore more dynamic than most). And they’re playing around with TV. A question for them is what they’ll do about gaming, but regardless I’d count Apple as a contemporary case study in ongoing invasiveness.
I’ve talked with Kraft and I don’t think I’d put them in the innovative category. They have organizational structures in place that tend to encourage incremental innovation (a new pizza topping! a thicker cheese slice!) and discourage transformational innovations. P&G are more interesting and a better candidate largely because of their Connect and Develop initiative that exploits under-utilized resources, namely the skills of anyone and everyone outside of P&G’s own walls. Another interesting group is Tata, the Indian conglomerate that has made significant innovation recently in hotels and cars.
Mature organizations nearly always optimize around increasing the efficiency of their existing operations (increasing sales while reducing costs). This is reflected in org structures, compensation and incentives, leadership styles, team skills and capabilities, and new product development processes. It turns out, however, that all of these things that explicitly encourage efficiency have the tendency to discourage innovation. Even ideas like “best practices” tend to promote efficiency rather than innovation. So much of our work is aimed at helping them become ambidextrous (to use the term coined by Tushman and O’Reilly in their paper Ambidextrous Organizations), able to devote most of their attention to efficiency while simultaneously fostering effectiveness/innovation.