A workbook on doing disruptive innovation effectively

[cross posted at FASTForward Blog]

The Innovator’s Guide to Growth: Putting Disruptive Innovation to Work, Anthony, Scott D. et.al.

The Innovator’s Guide to Growth is the newest installment in a series of books articulating and explicating Prof. Clay Christensen’s theory of disruptive innovation. This hands on guide packages some of the insights developed as an outgrowth of the consulting work of Innosight, LLC, the consulting firm founded by Christensen to pursue the practical insights from his research at the Harvard Business School. If innovation is part of your current or prospective job description, this needs to be on your shelf (after you’ve read it, of course).

Christensen’s theories of disruptive innovation appeared first with the publication of The Innovator’s Dilemma in 1997. During the worst excesses of the dotcom boom, every start up business plan including an obligatory head nod to Christensen and an assertion that their business model was truly disruptive. Who doesn’t want to be innovative; ideally disruptively so. Christensen and his colleagues have continued to develop his theories in The Innovator’s Solution: Creating and Sustaining Successful Growth, Seeing What’s Next: Using Theories of Innovation to Predict Industry Change, and now The Innovator’s Guide to Growth.

Christensen distinguishes two forms of innovation — sustaining and disruptive — not in terms of their technological features but in terms of their relationship to markets. The distinction in summarized in the following diagram reproduced from The Innovator’s Guide to Growth.

Christensen-DisruptiveInnovationModel

In essence, Christensen’s theory of disruptive innovation flows from recognizing that the pace of technology improvement is generally more rapid than the capacity of users in the market to take advantage of those improvements. This differential is what open possibilities for differing approaches to innovation.

In this market oriented theory of innovation, there are three paths available to organizations interested in articulating potentially disruptive strategies. The first is to identify and target “nonconsumers;” potential consumers for whom existing technologies fail to meet their particular needs. The second is to identify existing customers where existing technologies are more technology than they needs. The final is to investigate potential consumers in terms of what Christensen’s theory describes as “jobs to be done” as a path to defining new products and services to perform these jobs. I must confess that I still find this path the least well articulated aspect of this theory.

Throughout this book, the authors start by recapping the essentials of Christensen’s theoretical arguments and proceed to develop the next level of operational detail it takes to transform strategic insights into execution details. If you’re an organization seeking to develop its own disruptive strategy, the authors here have worked out many of the next level questions and identified the supporting analyses and design steps you would need to answer and complete. The authors are clearly competent and talented consultants who are willing to share how they manage and do their work. Their hope, of course, is that many of you will conclude that you need their help to do the work. What is nice here, is that they are confident enough in their abilities that they are quite thorough in what they share. This volume is not a teaser; it’s complete and coherent. You could pretty much take the book as a recipe and use it to develop your project plans. On the other hand, the plans by themselves won’t guarantee that you can assemble a team with the necessary qualifications to execute the plan successfully.

The other thing that this book does quite nicely is identify the kinds of organizational support structures and processes that you would want to put in place to institutionalize systematic disruptive innovation.

Christensen and his colleagues are continuing to build a rich, systematic, theory of disruptive innovation. With roots in academic research, they are freely sharing their insights and their methods. The Innovator’s Guide to Growth is a solid workbook that will let you develop your own skill at doing disruptive innovation. Of course, the plan by itself won’t eliminate the need to gain the experience for yourself. But it’s a lot better strategy than to have to work everything out from scratch on your own.

Learning from the failures of others; billion-dollar lessons for next to nothing

Billion-Dollar Lessons: What You Can Learn from the Most Inexcusable Business Failures of the Last 25 Years, Carroll, Paul B. and Chunka Mui

Progress in science and engineering proceeds from the dispassionate analysis of failure. We learn more when we screw up than when we succeed. However, since Waterman and Peters In Search of Excellence,

Review of Tom Davenport’s "Competing on Analytics"

Competing on Analytics: The New Science of Winning, Davenport, Thomas H. and Jeanne G. Harris

 

Tom Davenport has turned his attention of late to the prospects for business intelligence and information analytics. Competing on Analytics offers a managerial introduction to the topic. It emphasizes why organizations ought to be interested in the topic, what kinds of payoffs they might expect, and how organizations will need to adapt to take advantage of robust analytics. Davenport and co-author Jeanne Harris of Accenture split the book into two major sections. The first deals with describing how analytics can be used as a competitive tool; the second with the organizational challenges of building analytical capabilities. Overall, it’s a relatively short book and is well-suited to its target audience. On the other hand, if you’re on the receiving end of a mandate to build an analytical capability after someone higher in the food chain has gotten excited about the topic, don’t expect quite as much in the way of detailed implementation advice.

Davenport and Harris set out a stage-model of analytical capabilities starting with "analytically impaired" and ending with "analytical competitors." Partly, this is to support an argument they make that there’s an advantage to managing analytics at an enterprise level. My cynical side suspects that this advantage lies primarily in providing a clear target for the likes of Accenture or SAS to sell to.

Given that every new capability benefits from senior executive attention and that everyone wants to get on the CEO’s calendar, are there, in fact, compelling reasons that analytics deserves to be on this short list? Two come to mind. One is that the expertise called for in effective analytics is scarce. Better to have that expertise directed at the targets of greatest opportunity by those best positioned to judge. Two, the competitive business opportunities that might yield to analytics are more likely to be found from the perspective of those with an integrative view of the enterprise.

The authors walk through major functions of the enterprise identifying opportunities and examples of how analytics have been successfully applied. There are clearly an abundance of opportunities to apply analytical tools and techniques to improving internal processes, optimizing supply chains, and leveraging marketing.

One problem with the focus on describing the business opportunities for analytics is that the variety of potentially applicable tools gets short shrift. All books have to make decisions about what to put in and what to leave out. Given the intended audience, I can understand the decision to focus on the business side of the equation rather than on the tools side. On the other hand, glossing over the complexities of the statistical tools and algorithms has its own risks. Organizations risk creating a new class of wizards whose dark arts must be taken on faith or they risk putting dangerous tools in the hands of amateurs who will be blind to both the limits and the dangers of the tools.

This brings us to the second part of the book and the challenges of building an analytical capability. I

Grounded advice on making better use of your brain

Brain Rules: 12 Principles for Surviving and Thriving at Work, Home, and School, Medina, John

John Medina is a molecular biologist bent on sharing how what we know about the brain can help us be more effective in the world at large. His central argument is that there are simple, but very important, lessons to be drawn from what science has learned in recent years about how the brain operates. Many of these lessons run counter to the practices and conventions that hold sway in our schools and organizations.

You can be pretty sure that I

Scary thoughts on one all-too-possible near future

Little Brother, Doctorow, Cory

It may be time to get more serious about using PGP and learning about Tor. Little Brother takes us into a near-future version of San Francisco where Jack Bauer has clearly become the U.S. Attorney General. Marcus is a seventeen year-old high school student who likes to play video games, role play, and has it all figured out (he’s 17 after all). In the wrong place at the wrong time, Marcus gets swept up by Homeland Security after a terrorist attack, held for questioning for days, and released with the threat that he’ll be watched carefully to make sure that he behaves.

The world that Marcus returns to has ratcheted up both fear and surveillance to something on the wrong side of police state. He chooses to fight back mostly out of adolescent stubbornness coupled with enough technical expertise to be dangerous to both the nascent police state and to himself and his friends. Doctorow is becoming a better and better storyteller with each of his books and Little Brother motors along. I pretty much dropped everything I should have been doing to plow through it over the course of two days.

The book has its flaws. The bad guys tend to be caricatures. The “lessons” about various hacks and technologies sometimes slow things down, although not as much as you might think. Doctorow may have his agenda but he remembers that his first priority is to entertain. Along the way, he also manages to get you to think about his larger message.

Sketching your way to insights

The Back of the Napkin: Solving Problems and Selling Ideas with Pictures, Roam, Dan

One of the rules of thumb I learned in the early days of my consulting career was that your project wasn’t real until you had at least one napkin or placemat filed in your working papers with some sketch that captured the essence of what you were designing or trying to understand. Dan Roam’s new book, The Back of the Napkin, makes the same case and provides substantial insight and guidance on how to make those sketches more useful.

Artistic talent and skill is largely irrelevant to Roam’s discussion. He’s talking about drawing as a thinking tool and the value of simple pictures in understanding complex phenomena. While his work is rooted in deep understanding of how our visual system and brains work, Roam boils it down to simple and practical advice. He summarizes the book with an image of a Swiss Army knife. Here’s my very own sketch of that drawing:

BackOfTheNapkinSwissArmyKnifeSummary

The heart of Roam’s approach is a process of Look, See, Imagine, and Show. The distinction between Look and See is a bit subtle. In Roam’s formulation, Looking is somewhat more passive and is about taking in the raw materials of what is out there, while Seeing is a more active process of chunking and imposing order on those raw materials. Imagine moves away from our eyes to our mind’s eye where we can experiment with multiple representations of what we’ve seen and how we can make sense of it. Finally, Show is about working out ways to take someone else through the mental process that will help them see what we’ve come to see. Again, here’s my version of Roam’s model:

Roam-LookSeeImagineShow

While a good picture may indeed be worth a 1000 words, Roam is no advocate of simply letting a picture speak for itself. He has two purposes with his book. The first is to equip you with better tools for using simple pictures to furthering your own understanding of problems. The second is to educate and convince you to put those tools to use in helping communicate your new understanding to others. Roam provides good advice about the kinds of pictures you should draw to address the classic journalistic questions (Who, What, Where, When, Why, How, and How Much). He also introduces a curious mnemonic, SQVID, which translates to Simple, Quality, Vision, Individual Attributes, and Delta. Each represents one pole in choices you can make when you are sketching a particular concept.

This is a rich and useful book. If you’re already a visual thinker, it offers a good organizing framework and collection of tools and techniques to add to your bag of tricks. If you’re not yet a visual thinker, this should provide you with the necessary encouragement to start.

David Maister on getting from strategy to execution

Strategy and the Fat Smoker; Doing What’s Obvious But Not Easy, Maister, David

 

David Maister has spent years advising professional service firms on the particular challenges of running their businesses. I first met David during my MBA days when I was a student in his course on the Management of Service Operations. I’ve come to trust his insights and perspectives about the professional world I occupy. More recently, I’ve come to see that his perspective is more generally relevant as more and more of us do work that is effectively professional, even if we are not inside actual professional services organizations. There is a substantial overlap between professional work and knowledge work, which makes Maister more relevant than ever.

Strategy and the Fat Smoker is David’s most recent effort to share his insights. In it, he turns his attention to the particular challenge of bridging from knowing what to do to actually managing to do it. In fact, David starts with the observation that “real strategy lies not in figuring out what to do, but in devising ways to ensure that, compared to others, we actually do more of what everybody knows they should do.”

Structurally, Maister works through his argument by working through what constitutes strategy in this particular perspective, the central importance of client relationships, and how those shape the kinds of management practices most likely to be effective.

For Maister, strategy is primarily a problem of organizational design and management, which is the soft stuff that always turns out to be hard. It is particularly hard, however, when the organization in question is populated with professionals/knowledge workers who must produce and deliver services to clients. You cannot succeed by designing systems and processes to compel behavior, because you have a workforce that can’t simultaneously be forced to comply with a system and exercise their independent and autonomous judgment. Maister explores this issue by focusing on two dimensions that characterize a professional; to what degree do they prefer to work solo vs. collaborate within a team and to what extent to they prefer immediate rewards vs. being willing to invest now in future payoffs. The point, of course, is not that one set of answers is better than another, but that trying to mix people with different answers in the same organizational environment is probably not a terribly good idea.

David also presents a provocative discussion of the importance of organizational purpose. While he acknowledges that shared purpose can be a very powerful tool within an organization, he argues that the power only comes when there are clear “consequences for non-compliance.” Until and unless you can translate generalities about purpose into clearly stated and observed rules of performance, then there’s no point to worrying about purpose.  Put more positively, the test of strategy comes in working out and then operating within the day-to-day rules of performance that make sense for your strategy.

In one sense, Maister doesn’t break any extraordinary new ground. What he does do is to challenge you about how willing you are to drive grand ideas deep into how you choose to do your work on a day-to-day basis. And he offers lots of good, concrete advice on how to make that transition.

Allan Cox on finding your singularity

  Your Inner CEO: Unleash the Executive Within, Cox, Allan

This book is a bit of an unusual hybrid, lying somewhere between a management text and a self-help book. While it’s being marketed as a business book, it’s applicable in a much wider range of settings.

Your Inner CEO is another entry in the long argument that self-knowledge is the core of effective performance. What makes this entry more intriguing, and more valuable than most, is the unique perspective that its author, Allan Cox, brings to the exercise. Allan works as an executive coach and consultant to CEOs, boards, and senior executives of large and small organizations around the world. His advice is rooted in the pragmatic experiences of years of working with demanding and skeptical audiences. 

He describes beginning new assignments with the following statement to his clients:

I’ve found, almost without exception, that by the time executives get married, take on a mortgage, raise kids, cope with the crabgrass, climb the corporate ladder, do their best to manage career pressures, and build their net worth and get into their forties, they’ve lost touch with what they believe in and care about most deeply. (p.20)

He goes on to quote Eric Hoffer:

That which is unique and worthwhile in us makes itself felt only in flashes. If we do not know how to capture and savor those flashes, we are without growth and without exhilaration. (p.20)

Your Inner CEO is Allan’s map for how to find and tap “that which is unique and worthwhile is us.” It’s organized into nine chapters:

  1. Goals
  2. Changes
  3. Facades
  4. Boundaries
  5. Boards
  6. Visions
  7. Futures
  8. Models
  9. Mentors

Each chapter offers a series of stories and recipes for exercises that can help you and your organization do the necessary work of discovery. Allan takes his theoretical lead from the psychology of Alfred Adler, a contemporary of Freud and Jung, who emphasized a more social conception of psychological well being. I don’t know enough to say what the mix is between Adler’s theories and Allan’s distillation of them from his work in business settings. The result, however, is a collection of deceptively simple questions and exercises that can lead to deep reflection.

The core exercise is a quest to articulate what Adler termed “style of life,” an integration of self-image, world view, and central goal. These are drawn out by completing the following three sentences with two to three word answers:

  • I am ____________________________________
  • Life is ___________________________________
  • My central goal is __________________________

While easy to state, digging for honest answers takes work. I’m several weeks into the effort and just now beginning to reach answers that feel meaningful.

In the chapter on Visions, Allan turns this same grounded approach to strategic planning in organizations. Consider the chapter opening quote from Yogi Berra, , “we may be lost, but we’re making good time,” a clue to Allan’s perspective. Allan challenges you to answer “who are we?” and “where are we headed right now?” as a necessary first step in formulating strategies with any hope of success. Dreaming about who we might like to be needs to be grounded in who and what we already are, either as individuals or organizations.

Allan’s approaches square with my own biases. I’d place Your Inner CEO in with Ellen Langer’s Mindfulness and Donald Schon’s The Reflective Practitioner as examples of the power of good conceptual frameworks grounded in rich data from the real world. You need to do the work, but the payoffs will follow.

 

 

Gibson’s “Spook Country”

  Spook Country, Gibson, William

I’ve been a fan of Gibson since discovering Neuromancer twenty years ago. A lot of people whose opinions I value have had great things to say about Spook Country and it’s been on the NY Times best seller list for a number of weeks. It even has it’s own Wikipedia entry.

Perhaps I am simply insufficiently sophisticated or old-fashioned in my literary tastes, but I struggled to finish it. I can’t entirely put my finger on why. For one thing, the parallel story lines felt so wildly disconnected from one another, that the implicit promise that they would connect at the end kept interfering with my ability to immerse myself in the flow. For another, I never managed to connect with any of the characters. Finally, in some strange way, I found that the clear skill and craft of Gibson’s writing kept intruding itself on me, instead of drawing me into the story itself.

Fundamentally, Spook Country, for all of its commercial success and glowing reviews isn’t one of Gibson’s best efforts. Interestingly, I found the mixed reviews at Amazon to be more representative of my experience with the book than the “official” reviews elsewhere.