Driving Organic Growth and Innovation

Underpinning of Driving Organic Growth Blog

by Robert Cooper

After much investigation I found four critical components of a successful corporate innovation effort and have tagged the posts in this blog appropriately.

The Critical Role of Leadership
Leadership must frame the overall innovation effort; make the critical resource decisions in a transparent fashion; clear any obstacles that would impede momentum; legitimize the initiatives within the corporation; and, play a major role in setting the climate for innovation.

The Importance of an enabling Corporate Climate
Corporate Climate deals with the: cultural barriers to growth through innovation; the skills required; the incentive systems to create the right behavior; the managing systems and attitude. We have found that managing business risk is an absolutely critical component to a successful, sustainable innovation effort.

Sources of Ideas
Ideas are of course the basis for innovation. Where they come from is changing dramatically. We will discuss this thoroughly going forward. However, you will fall way short if all you do is generate ideas.

The Importance of Process
Process is the final component to a successful innovation effort and we will share what different companies have tried. Within this group there are sub-groups of Managing Uncertainty, Being Ambidextrous and Creating Competitive Separation.

Tuesday, May 15, 2007

Finding Your Next Core Business
What if you’ve taken your core as far as it can go?
by Chris Zook

HBR April, 2007
Reprint: R0704D

There are some very powerful insights in this article and I suggest you order the reprint.

Welcome to the new members of our blog network – the new alumni of our Driving Organic Growth executive education program.

How do you know when your core needs to change? And how do you determine what should replace it? From an in-depth study of 25 companies, the author, a strategy consultant, has discovered that it’s possible to measure the vitality of a business’s core. If it needs reinvention, he says, the best course is to mine hidden assets.

Some of the 25 companies were in deep crisis when they began the process of redefining themselves. But, says Zook, management teams can learn to recognize early signs of erosion. He offers five diagnostic questions with which to evaluate the customers, key sources of differentiation, profit pools, capabilities, and organizational culture of your core business.

The next step is strategic regeneration. In four-fifths of the companies Zook examined, a hidden asset was the centerpiece of the new strategy. He provides a map for identifying the hidden assets in your midst, which tend to fall into three categories: undervalued business platforms, untapped insights into customers, and underexploited capabilities. The Swedish company Dometic, for example, was manufacturing small absorption refrigerators for boats and RVs when it discovered a hidden asset: its understanding of, and access to, customers in the RV market. The company took advantage of a boom in that market to refocus on complete systems for live-in vehicles. The Danish company Novozymes, which produced relatively low-tech commodity enzymes such as those used in detergents, realized that its underutilized biochemical capability in genetic and protein engineering was a hidden asset and successfully refocused on creating bioengineered specialty enzymes.

Your next core business is not likely to announce itself with fanfare. Use the author’s tools to conduct an internal audit of possibilities and pinpoint your new focus.

This is an example of his tools to test the strength of your existing core.