The Innovator's Dilemma - I watch and live the dilemma happen every day, as the company I work for tries to recover from the disruption that took us by a surprise reserved only for the disrupted. A blind spot that plagues the best of companies, as this book describes very well.
As I leafed through the pages of The Innovator's Dilemma today, a book that I've read before it all became so personal, I asked myself these questions:
- Anecdotal evidence shows that change is happening faster than ever and adaptation to these changes needs to be at least as fast. If we failed to innovate we should at least have the capacity to identify innovative trends and quickly realign to them. It is interesting to study what structural, psychological, and cultural qualities and attributes characterize R&D groups that rise to the challenge of responsive innovation while catering to the needs of existing customers and products.
- As the excerpt below so honestly describes, when innovation is not in your DNA (or company mission), R&D middle management plays a crucial role in unknowingly supporting or hampering innovation. How do we align the low-level decisions with the strategic decision to keep innovation a priority?
- As we manage our own professional career, aren't we exposed to the same forces and circumstances which can "cause great
firmsemployees to fail" (if I may paraphrase the title)? Is our private disruption around the corner? Are we correctly spotting our personal disruptive threats and opportunities?
"As we saw in chapter 4, resource allocation is not simply a matter of top-down decision making followed by implementation. Typically, senior managers are asked to decide whether to fund a project only after many others at lower levels in the organization have already decided which types of project proposals they want to package and send on to senior management for approval and which they don’t think are worth the effort. Senior managers typically see only a well-screened subset of the innovative ideas generated.
And even after senior management has endorsed funding for a particular project, it is rarely a “done deal.” Many crucial resource allocation decisions are made after project approval—indeed, after product launch—by mid-level managers who set priorities when multiple projects and products compete for the time of the same people, equipment, and vendors. As management scholar Chester Barnard has noted:
From the point of view of the relative importance of specific decisions, those of executives properly call for first attention. But from the point of view of aggregate importance, it is not decisions of executives, but of non-executive participants in organizations which should enlist major interest.
So how do non-executive participants make their resource allocation decisions? They decide which projects they will propose to senior management and which they will give priority to, based upon their understanding of what types of customers and products are most profitable to the company. Tightly coupled with this is their view of how their sponsorship of different proposals will affect their own career trajectories within the company, a view that is formed heavily by their understanding of what customers want and what types of products the company needs to sell more of in order to be more profitable. Individuals’ career trajectories can soar when they sponsor highly profitable innovation programs. It is through these mechanisms of seeking corporate profit and personal success, therefore, that customers exert a profound influence on the process of resource allocation, and hence on the patterns of innovation, in most companies."
