Tuesday, July 24, 2007

Competent Innovation

I've been working on a guidebook for individuals and teams who are just starting out their innovation initiatives and interviewing clients, colleagues and friends about what they think makes an innovation initiative successful. One of the most consistent answers has been the question of whether or not the ideas dreamed up align to core competencies.

Now, this has left me in one of those "on one hand, on the other hand" situations. Strategically speaking, core competencies are the things you think you do well, and quite possibly better than other people. Therefore, it makes sense for your ideas to align to and reinforce your core competencies. However, this approach also means ignoring opportunities outside your comfort zone and doubling down on the things you do well.

Wait for it - here it comes - on the other hand, innovation should be about creating new products and services the market needs and wants. So, using your core competencies as your scope or boundaries may cut you off from significant opportunities or new markets. The question in my mind should be - do we have the competency or can we partner for it or acquire it quickly?

Another way to look at this is to consider the iPhone. Now, Apple does not have core competency in phones - but it does have a lot of core competency in handheld consumer gadgets (iPod) and in computing - especially in the user interface (thanks Xerox Parc). So, Apple could have chosen to ignore the booming cellular phone market, since cell phones weren't in their core competencies, or could choose to redefine their competencies as all handheld computing devices including phones. Then, they needed to partner with someone for the phone electronics, while they developed a handheld platform marrying the phone, the music player and a number of other capabilities. Again, it's the same formula as the iPod - a little later to market with a nicer design and user interface, and a more complete solution. However, in this case Apple is tied to ATT for a while. It will be interesting to see if ATT can live up to the expectations true Apple lovers have.

Anyway, the point is - yes, you do need to consider your core competencies when you generate and consider ideas, but don't define them too narrowly or you'll likely miss a great opportunity - one that exists at the intersection of your capabilities and anothers.
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posted by Jeffrey Phillips at 11:13 AM


Anonymous Jay Hamilton-Roth said...

Don't forget that innovation generally happens in small increments (seldom the "big aha"). These types of innovations align well with business core competencies.

Don't confuse core values with core competencies: core values are the business "soul". Competencies are skills - you can always find people with skills.

6:12 AM  
Blogger gkrauska said...

Jeffrey - you make a good point. Too many people attempt to take incremental steps from where they are rather than incremental leaps to pursue where the customer wants or needs to be.

More often, I am finding that companies need to shift their view of core competency and how they leverage their competencies in order to be successful 5 years from now. That does not mean abandoning what they are good at. It may mean adding new skills, some of which are not easy to find. And that's what often sets them apart.

5:13 PM  
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