Billion-dollar Ideas: Finding Tomorrow’s Growth Engines Today

To create growth in uncertain times, use this disciplined and market-focused methodology. It can help you discover and distill attractive new ideas and build a business case for implementing the best of them.

by Greg Lavery and Chris Manning

http://www.strategy-business.com/article/00056?rssid=all_updates&gko=ef79c&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+StrategyBusiness-AllUpdates+(strategy%2Bbusiness+-+All+Updates)

Fabulous insight!!!!!!

"After several years of survival mode for many companies, growth is back on the agenda. But the requirements for success have changed. In today’s conditions — uncertain recovery, limited capital, and many new competitors — companies must find new ways to grow.

There’s no going back to the growth ideas that were bouncing around the organization before the global financial crisis. Executives need a robust framework to help them rapidly develop a long list of opportunities and then choose the very best ideas from it. The process must be comprehensive, efficient, rigorous, collaborative, and focused on “market-back” opportunities designed to meet customers’ needs. And it must be bold — the company must resist the temptation to do what has been done in the past.

Booz & Company has created a methodology for this, based on five lenses used for evaluating growth strategies. The five lenses — share of wallet, new regulations, technology and applications, distinctive capabilities, and business models — represent discrete and complementary ways to find and judge unconventional and unseen ideas. This approach has already been used successfully by companies in many industries and geographies."

Deep Change: How Operational Innovation Can Transform Your Company

by Michael Hammer

Breakthrough innovations in operations—not just steady improvement—can destroy competitors and shake up industries. Such advances don’t have to be as rare as they are.

HBR.org > April 2004

We spend a lot of time in our work on driving organic growth on innovation. What does that mean? The formal definition of innovation is “the act or process of inventing or introducing something new” which is normally applied to new products or services. This article offers tremendous insight into how operational innovation can lead to substantial growth. The key is creating competitive separation, i.e., creating separation between you and your competitors in the eyes of your customers. Anecdotally, one could argue that is may be more difficult for your customers to match gains from operational innovation since it usually involves a whole system than innovating in products or services.

"In 1991, Progressive Insurance, an automobile insurer based in Mayfield Village, Ohio, had approximately $1.3 billion in sales. By 2002, that figure had grown to $9.5 billion. What fashionable strategies did Progressive employ to achieve sevenfold growth in just over a decade? Was it positioned in a high-growth industry? Hardly. Auto insurance is a mature, 100-year-old industry that grows with GDP. Did it diversify into new businesses? No, Progressive’s business was and is overwhelmingly concentrated in consumer auto insurance. Did it go global? Again, no. Progressive operates only in the United States.....

....The secret of Progressive’s success is maddeningly simple: It outoperated its competitors. By offering lower prices and better service than its rivals, it simply took their customers away. And what enabled Progressive to have better prices and service was operational innovation, the invention and deployment of new ways of doing work.

Operational innovation should not be confused with operational improvement or operational excellence. Those terms refer to achieving high performance via existing modes of operation: ensuring that work is done as it ought to be to reduce errors, costs, and delays but without fundamentally changing how that work gets accomplished. Operational innovation means coming up with entirely new ways of filling orders, developing products, providing customer service, or doing any other activity that an enterprise performs."

How Learning Leads to Results
Matthew E. May, author of The Shibumi Strategy: A Powerful Way to Create Meaningful Change, introduces a passage on the critical role of a learning focus in innovation from The Other Side of Innovation: Solving the Execution Challenge, by Vijay Govindarajan and Chris Trimble.

http://www.strategy-business.com/article/ac00019?pg=all

This article is fabulous and underscores our work that the innovation process is one of constant learning and adapting.

"Learning and innovation cannot be separated. That’s why low-resolution prototyping is a critical part of the innovation process, because every savvy designer knows that before anyone can improve or innovate anything, learning must take place. In fact, there isn’t a successful design firm in the world that doesn’t elevate to gospel the “fail fast and learn” principle.
Although learning and innovation are closely linked, learning comes first. The great innovators understand that it is learnership that results in leadership....

...Learnership is all about the beta. It is an acquired capability, a teachable discipline. It requires developing a strong skill and a sound process. In this passage, Govindarajan and Trimble provide a precise and valuable definition of learning — and a reason that innovators should pay attention to it.
— Matthew E. May....

..When we speak with executives about the overriding importance of learning from experiments, we sometimes sense a degree of impatience. The overwhelming goal, in the minds of some, is not learning; it is results. Learning is a soft and squishy objective; results, on the other hand, are what business is all about.

We sympathize with that point of view. Learning, as an outcome, can sound like a consolation prize. “Sorry that the project failed, boss, but let me tell you, we learned a ton.” We get it. With innovation, however, placing primary focus on learning rather than results actually leads to better results.

We are not talking about learning in a general, feel-good sense. We are talking about a very specific type of learning. For our purposes, learning is the process of turning speculative predictions into reliable predictions"

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