I read a fabulous article recently by one of my former colleagues. Actually, calling him a colleague is a bit of a stretch because, frankly, he was more an inspiration to us at the company and someone we aspired to be like. Nonetheless, he has moved on to a very exciting "chapter two" and is focusing on some fascinating work on business innovation and sustainability while at Harvard University. The article is here if you wish to read it...and I offer it up with many cheers to Derek van Bever for this article and many thanks for the years of mentoring.
https://www.foreignaffairs.com/articles/africa/2014-12-15/power-market-creation
The authors explore the drivers of innovation in developing countries and the cases they look at are wonderful illustrations of creativity among entrepreneurs working in very difficult economic contexts. Many of the same contexts, in fact, that my current clients are dealing with as they attempt to grow their economic footprints in the BRIC countries. What struck me first about the study is that like many foreign policy scholars, they paid attention to the "levels of analysis" approach so prevalent in International Relations as a discipline. The article is in Foreign Affairs, after all, so this was a wise approach. But interestingly, they eschewed the systems level and state levels approaches most common to foreign policy pundits, which might have been translated in the economic context by focusing on the macro- and micro-economic frames that tend to be used by economists, and instead they went to the individual ---the entrepreneurial--- level to ask "what drives truly powerful innovation?"
Their approach identified three types of innovation. "Sustaining innovation" which replaces old products with newer, better ones. "Efficiency innovation" which produces more for less. And "market-creating innovation" which transforms new products into affordable services for the masses in order to reach an entirely new population of consumers. Their general argument is that market-creating innovation is the most powerful and sustainable innovation given that it targets under-consumption or non-consumption in identifiable markets and in doing so meets unfulfilled needs in new markets. It feels like a powerful argument to me and they do a very solid job of presenting cases to back up their thinking. I encourage you to read the entire article.
There is much to admire in the article and for my purposes it triggered some pondering of the skills needed to support "market-creating innovation". It's early days for me as I consider this article, but it struck me that "market-creating innovation" demands some powerful skills that are likely to be present in companies to varying degrees. Skills such as creativity, decision making under uncertainty, certainly product management skills. I am sure in fact whatever list I came up with it would be incomplete.
Then it occurred to me that in such situations of uncertainty and unfamiliarity posed by these potentially market creating innovations --- opportunities for growth that are new and unfamiliar to the company AND to the individuals involved ---that the skills needed are less focused on content per se, and more centered on "learning as a process". So that would mean developing the skills of recognizing --- extracting ---reflecting --- applying --- and sharing would be far more important than any requisite content set I might identify. In essence, these situations of market-creating innovation require significant learning capability in our organizations, learning agility --- a highly developed ability in how to learn and less emphasis on what is learned, in terms of a canon of information.
This reminded me of a great film I saw recently --- All is Lost, with Robert Redford, the story of a man sailing solo around the world who has to apply everything he knows and doesn't even know he knows about sailing after his boat hits a shipping container that must have fallen off a freighter. It's a film with no dialogue. Actually Redford says only one word in the film, which I won't repeat here but I imagine many sailors have said it. Anyway, we see Redford in a new and unfamiliar situation, having to sail his boat as it falls apart all around him and he drifts further and further out of the sea lanes. And taking him to a moment of despair where he believes “all is lost”. But without giving anything about the film away, what we see Redford doing throughout the story is recognizing, extracting, reflecting and applying into the unfamiliar situation ---the market creating innovation situation--- in his case a sailing crisis that demands everything he can give. He didn't need another course with "content" about sailing. He had to draw upon deeply embedded skills of recognizing, extracting, reflecting and applying in order to seek innovations that might save the day. I will leave it to you to watch the film. It's brilliant.
But it underscores for me that more content, teaching on stuff, might not be what my clients need.
Now, as I said, early days for me as I try to think through this, but this article has helped me formulate the question I will be asking my clients across the next year --- do you know the way to market creating innovation?
Followed very quickly by a second question: what can I do to help your organization develop its learning capability to drive market creating innovation? As your company begins to outline its growth strategy, chances are, you will be exposed to more and more contexts like those described in the cited article, and like Redford, might feel like All is Lost. But finding a way to develop your organization's learning capability could in fact be central to your enterprise's growth strategy. No greater argument for investing in human capital and development could be made perhaps.
