Saturday, January 03, 2009

Discovery Driven Planning: Most barriers to growth are self-inflicted

Rita McGrath is a colleague of mine who played a key role in developing the Market Driven Growth process that is the underpinning of our executive education programs at The Kellogg School. The Discovery Driven Planning process is an extremely valuable tool in implementing growth strategies when there is a high level of uncertainty and is the backbone of our class on Implementing Growth Strategies. I think her incites are worth sharing and I refer you to her blog site and highly recommend her new book discussed below.


I am spending today with a very well-managed, large company, and even here the long fingers of the economic slowdown are creating even more obstacles to innovation - led growth than in more ‘normal’ times.
The issues they raised as barriers to growth include:
• The “de-risk” mode that many companies have gone into which makes anything even remotely unpredictable look dangerous
• A lack of a global mindset that leads to local optimization of investment and cuts off more promising corporate projects
Brand conflict - when a new project isn’t a great fit for the existing brand
Churn among the managers and leaders involved in innovation projects
Silos within the organization
Existing metrics and rewards that are not suitable for innovation
Fear of cannibalization of the existing business
Fear, in general
Short-termism driven by quarterly results pressure
• Politics
Existing power structures in the company

What I find absolutely fascinating about this list (and remember, this is an extremely well managed firm) is the extent to which the barriers to growth are essentially self-inflicted. They are internal processes, systems, relationships and politics that can get in the way of doing anything new. Existing companies tend to have accumulated lots of these sorts of barriers - but it doesn’t have to be a foregone conclusion that these will be or should be in place. Here is where adroit innovation leadership, to me, can make all the difference. This is one of the key themes in our forthcoming book Discovery Driven Growth.

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