Adapt or die: How to foster innovation to future proof your business

Your Hosts Today  Professor Tazeeb Rajwani Director of Executive Education, Essex Business School  Viren Lall Managing Director, ChangeSchool  Emily Macdonald Head of Marketing, Essex Business School

Adapt or Die: How to foster innovation to futureproof your business University of Essex Business School Webinar 11am, Friday 13th October 2017

Click to insert picture

Click to insert picture

2030: 47% of all current jobs could be automated (+/- 2 billion jobs)

Click to insert picture

2016: 90% of all UK Jobs created now come from companies that are less than 5 years old

AT THE HEART OF CAPITALISM IS CREATIVE DESTRUCTION.

Joseph Schumpeter (1883-1950)

INNOVATION IS THE MARKET INTRODUCTION OF A TECHNICAL OR ORGANISATIONAL NOVELTY, NOT JUST ITS INVENTION. Joseph Schumpeter (1883-1950)

What did people tell us?

 “We find it hard to start innovating”  So what makes innovation hard?

 “When we do innovate, results are not inspiring”  How can you make it more successful?

 “How can I get my whole company, not just leadership team to be more innovative?”  Can we manage our company culture?

Value of Kodak $m

Payoff from the iPod

C’mon, C’mon It’s either one or the other…

.

Given a 10 percent chance of a 100-times payout, you should take that bet every time.

Failure and invention are inseparable twins. To invent you have to experiment, and if you know in advance that it's going to work, it's not an experiment"

Jeff Bezos, CEO Amazon

What did people tell us?

 What makes innovation hard?  What makes innovation different?  How can you manage innovation?

Business as usual

Innovation

Business as usual

Short term Earning Call driven Net Present Value Go / No Go

Innovation

Business as usual

Short term Earning Call driven Net Present Value Go / No Go

Innovation

You will always miss 100% of shots that you don’t take

Wayne Gretzky, Hockey Legend

Future proofed organisations work on 3 horizons in parallel:

Product

Process

Business Model

Operating Margin Growth in Excess of Competitive Peers

Source: IBM, CEOs are expanding the innovation horizon: important implications for CIOs

Innovation is under your control

Who innovates?

 Incumbent: A firm that manufactured and sold at least one product belonging to the preceding product generation

Non-Incumbent 53%

Incumbent 47% Source: Chandy and Tellis 2000

Innovation is under your control

Innovation Paradoxes  Pre-empting the future, yet profiting in the present  Developing core competencies, but preventing core rigidities  Maintaining organizational continuity, yet adapting and changing  Maintaining standard processes, yet fostering creative chaos  Becoming cross-functional, yet deepening functional expertise  Diversifying and growing, but yet staying focused and lean

What Drives Sustained Innovation Across Nations?

Popular belief:

Ethnicity

Sociologists:

Religion

Social-psychologists:

National culture

Geographers:

(Distance from equator)2

Legal scholars:

Intellectual property

Economists:

Inputs

Thesis:

Internal culture of firms

Main Finding: A Firm’s Culture

Firms’ cultural traits drive innovation across nations

Innovation is under your control

What Do We Mean by Firm Culture?

 Three attitudes 1. Willingness to cannibalize 2. Future market focus 3. Tolerance for risk

 Three practices 1. Product champions 2. Asymmetric incentives 3. Internal markets

What makes innovation hard?

What makes innovation different?

How can you manage innovation?

 What makes innovation hard?  What makes innovation different?  How can you manage innovation?

What next?

So what do you need to do as leaders and managers?

So what do you need to do as a leader to set your company on this path? What is the role of the manager?

How do you know when things are going well and when they are not?

What are the biggest pitfalls you will face and how can you avoid them?

For further information:

Email: Tazeeb.rajwani@essex.ac.uk Tazeeb Rajwani

THANK YOU

@Tazeeb