Public Media Conference: Our Own Innovator’s Dilemma and Solution

Scott Anthony, President, Innosight, was one of the speaker at the CEO Seminar on Tuesday. Innosight was founded by Clayton Christensen, who is perhaps best known for his book, “The Innovator’s Dilemma.”

What follows are my somewhat fleshed out notes from Scott’s presentation:

He warned us that many of the advantages we feel we have in our industry can work against us in a time of innovation. I won’t go too deeply into the theory of Disruptive Innovation because Clayton Christensen has written a lot about it and so have others. But there are a few key elements: (and please excuse my paraphrasing)

1) Companies that fail are often the very companies that were leaders in their field just before the disruptive innovation.

2) When innovators appeared in their industries, companies ignored them because their products weren’t highly developed or they offered limited feature sets.

3) Through an iterative process, those innovators managed to create a compelling product that captured a segment of the market the leader had chosen not to serve. Also through that iterative process, the innovator’s product improved.

4) This is probably the most compelling observation: when you look back at the failed companies, they appear to have done everything right: they paid attention to their core customers and focused on serving them better. And yet they no longer exist or they’re a shell of their former selves.

Anthony laid out a series of keys to disruptive success

1) Enable Nonconsumption – focus on reaching people who aren’t consuming your product, and ask this important question about them: what constrains consumption? Why aren’t they using your product? It might be skills, wealth, access, time.

2) Nail down the job to be done – finding the problem that isn’t adequately solved. We can use our demographics because it gives us information but we should also have an understanding of the circumstances in which our customers use us.

3) When we begin to roll out new services, delight but don’t overshoot. The disruptive solution you’re creating need not be perfect. “Good enough” is not a dirty word.

4) Master emergent strategy – that strategy says, invest a little, learn a lot. Start simple, limit your fixed cost investment, seek early wins. Don’t be too certain that any solution you create is right; the losers generally believe they’re right in the beginning.

5) Break the sucking sound at the core – the core business of the company is a center of gravity that will pull resources away from new, disruptive products. There needs to be a commitment from senior management to the project, there must be resource allocation to match that commitment (the way resources are allocated determines strategy), and there should be specialized approaches, recognizing the special position that the disruptive innovation has in the organization.

Anthony stressed a change of thinking in our companies/industry:

A shift from a monolithic product – to a portfolio of products.
A shift in how we understand our users: they’re no longer just readers – they’re consumers/audiences/contributors.
A shift in focus from advertisers – to customers.

In summary:

What is our plan to reach the nonconsumer?
What’s our plan to reach the nonconsuming business partner?
What’s the plan to master new business models?
How will we make innovation systematic?

Anthony also offered this thought, which is intriguing: if we spend all of our time trying to collaborate with each other, the effort to force or enforce collaboration can be stifling. It would be better to encourage broad innovation with the understanding that the doors to conversation and information sharing will remain open.