Several years ago, at an innovation conference where I was speaking, I found myself in the hotel bar at closing time talking to some of the big names and brains in the innovation consulting field (relax, I wasn’t drinking). I put a question on the table to my colleagues: “How many of your clients are looking for a big disruptive innovation?” The predictable response was, “Practically all of them.” The next question I asked was, “How many of them could actually accommodate a disruptive innovation?” The response from my colleagues was, “None of them.”
This is the dirty little secret of innovation. There are bajillions of organizations (3.14 bajillion to be precise) helping established organizations create “the next big thing” that will unseat the leaders, rearrange the marketplace, and obsolete what is currently so. And yet…And yet established organizations are loath to actually do what’s necessary to disrupt the industry because they have such a stake in ensuring that it continues. To do something that leads to lowered sales of existing product is akin to killing the goose that lays the golden eggs. Why would you do it? Kodak is the poster child of an organization that didn’t see the digital photo revolution coming. And yet they invented digital photography! For rational reasons, they couldn’t stomach the notion of killing their dominant market share in photographic film and couldn’t get out of their own way to surf the wave that they created.
And that’s why so many disruptions come from start-up firms. These firms have nothing to lose, so they have the freedom to imagine a world very different from the current reality. Car company Tesla took a very different approach to electric vehicles. Instead of making cars built on petroleum-engined cars, they started with a fresh approach in a fresh market. And their cars outsell similarly sized luxury vehicles from Mercedes Benz, BMW and Audi. Research has shown that organizations that really embrace creativity and innovation are those that are in “distress situations.” In other words, they better get it to work, because nothing else is.
The harsh truth is that most organizations choke on radically novel ideas. While they’d love the benefits of being a market leader in an industry that they created, it requires an organizational mindset (culture) that is very tough to create and maintain. So the job of innovation leaders throughout the hierarchy is to instill a fear of the status quo, and a willingness to take well-placed bets in creating new markets or unsettling existing ones. The organization that is afraid of the new, or is comfortable with what is, will not innovate in significant ways. This requires leaders to build the innovation capacity of their organization by focusing on — yes, innovation tools and skills — and also on driving an innovation mindset throughout the organization. Mindset matters. Mindset can be developed. And you, dear leader, are an important part of making that so.
What are you doing to create a culture in your organization that embraces disruption?