Tuesday, March 27, 2007

Hurry up and wait

Lately the market seems very hot for innovation software and consulting services. Our team has started a number of new engagements and it seems like there's a real, increasing demand for software and services that help firms become more innovative.

One of the things you can't help but notice, however, is that for every three or four companies you talk to where innovation is "urgent", only one or two will actually start a project in any timeframe that matches up to their urgency. I was speaking with a firm recently that seemed to have a very urgent need to innovate - other non-traditional competitors are clearly horning in on their core market. These non-traditional competitors don't enter a market with the same, traditional outlook and service offering, and are very attractive to customers. This entry alone should have been enough to kick start some new ideas on marketing and service development. As it was, the entry created an opportunity for a sales meeting. Several months later, I'm being told that the firm will not move ahead with innovation right now. I suspect cost cutting is in order.

Unfortunately, by the time it becomes apparent that the firm should create some new ideas, it may already be too late. One of the key drivers for innovation for many firms is the unexpected entrance of a competitor to its core market, especially non-traditional competitors. Another change that can be quick and disruptive is a change to the legal system, where one or two small provisions in the law can open up markets and opportunities for new competitors. As I noted above, by the time the firm identifies the threat and notices new competitors or new channels emerging, it is really almost too late. What frequently happens at that point is a rush to determine if the firm can quickly change and create a counter-punch or new products and services. But, given the atrophied innovation skills and product/service development timelines, it simply is not possible to react quickly enough, so the firm abandons innovation and turns to marketing or pricing power.

Competition and changes in the economy - services, legislation, internationalization - are happening faster than ever. A firm can no longer simply wait and react, but must be scanning the horizon and generating ideas that have to do with future outcomes and possibilities. Once someone else has stolen the march on your firm, catching up is difficult and getting ahead even more so.
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posted by Jeffrey Phillips at 4:42 AM

13 Comments:

Anonymous Chuck Yorke said...

This could also be titled, "no hurry, wait until it's too late, then do nothing." Innovation needs to be encouraged all the time, not when a problem is noticed.

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Anonymous christinetjan said...

in applying innovation, remember one thing, take action, don't just wait and watch

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