To Do or Not To Do - Now that's a Decision

A while back I had blogged about how impressed I was with the insights from Management Guru Peter Drucker as I read his classic book (aren't they all classics?) “Innovation and Entrepreneurship”. In Chapter 12, Peter discusses a process he calls “Selective Abandonment,” in which every three years or so, the enterprise must put product, process, technology, market, channel, and staff activity on trial for its life. The organization must ask, “Would we now go into this market, product, channel, technology, etc. today? If not, the next question becomes, “How do we stop wasting resources on it?” Selective abandonment not only helps free valuable resources for the “new” but helps an enterprise relieve itself of the burden of “near misses” and “half successes.”

How about just calling this "making a decision"?

The fact is making a decision is not as easy as it might appear. I just came across an interesting blog on HBR on this titled "To Move Ahead You Have to Know What to Leave Behind" by Nick Tasler. Did you know that when an executive announces that her business will change to become a luxury service provider, technically it is not a decision until she also states that they will not provide low cost services to price-sensitive customers anymore?

So, a necessary element of a decision is not just what will be done but also what will not be done. In fact, this element is actually part of the word [decide] itself. As Nick explains, the Latin root of the word "decide" is caidere which means "to kill or to cut." (think homicide, suicide, genocide.) Technically, deciding to do something new without killing something old is not a decision at all. It is merely an addition. But as he also explains, making trade-offs is mentally exhausting and uncomfortable, which is why most decisions never actually become decisions; they are just "pile ons" to existing initiatives.

The Bottom Line
Making real decisions is crucial in business and life. Michael Porter's theory on strategy is based on this concept - deciding what not to do is just as important as what to do. Innovation relies on this as both Peter Drucker and more recently Vijay Govindrajan have demonstrated with their respective theories on "Selective Abandonment" and "The Three-Box Model". Making decisions is a cognitively and emotionally taxing activity that the average person will go to great lengths to avoid but a key element of what makes great leaders great. Great leaders and change agents have come in all shapes, sizes, colors, genders, and personality types. But the one thing they all seem to have in common — the one thing that distinguishes them from ordinary people — is their willingness to decide when others could not.

Google's Culture Wars - Will Innovation Still Thrive?

Google's "20% time" has been legendary in terms of how many successful innovations it has helped Google bring to the market. Basically, Google allows its employees to use up to 20 percent of their work week at Google to pursue special projects. That means for every standard work week, employees can take a full day to work on a project unrelated to their normal workload. Google claims that many of their products in Google Labs started out as pet projects in the 20 percent time program.

That might be a thing of the past in the not so distant future...

At least that's what many in the industry are thinking out loud based on the recent demise of Google Reader, a popular tool for reading RSS feeds. Adding salt to injury, the original Google Reader, Chris Wetherell, says that he wouldn't have founded Google Reader within Google as the company exists today. Instead, he would have just gone elsewhere or started his own company. As Alex Kantrowitz explains in his blog on Forbes.com, "Wetherell’s comments highlight a problem Google might face now that Reader is shutting down. The company has long benefited from a culture of innovation which has helped it turn employee side projects like Gmail, Google News and Ad Sense into core offerings. But, with the understanding that even successful products can be killed in the future, the company’s employees might now have less of an incentive to launch their ideas within Google, and innovation at the company may suffer as a result."

The Bottom Line
Personally, here's what I think:

1. Google is devoting significant resources to it's social networking endeavors and has decided to redirect resources utilized on Google Reader to Google Plus. As a publicly traded company with a shareholder price to worry about, this type of cost/benefit analysis is to be expected. 
2. There could be a bit of "sour grapes" on part of the Google Reader's founder who of course would be personally attached to his invention.
3. It is a stretch to extrapolate that Google might either discontinue to 20% time or that employees would not use this time to explore their ideas in fear that their ideas would be squashed at some later time. One data point is just not enough to arrive at that conclusion. In statistical terms, this one observation could be deemed as an "outlier" - an observation that is numerically distant from the rest of the data and is often excluded from analysis.

I really don't think Google is going to be any less innovative than it was before. Let's not proclaim that the sky is falling just yet...

Tesla - An Evolving Ecosystem and A Tale of Business Model Innovation

Tesla's Model S is designed to allow a fast battery swap, exchanging a depleted battery for a fully charged battery in less than half the time it takes to refill a gas tank. To facilitate this, Tesla has introduced an innovative switching station based infrastructure based on a model pioneered by the now bankrupt electric vehicle company, Better Place. These switching stations serve a similar purpose to what gas stations serve for fossil fuel vehicles - if and when a motorist runs out of charge, they can replace their depleted battery with a fully charged battery. Realizing efficiencies and gains from economies of scale, these switching stations can be a win-win for both motorists and Tesla. Motorists are relieved of their anxiety of being stranded with a drained battery and the car company can get many more motorists to buy their vehicles and sign up for use of the stations. Tesla's latest battery swapping switching stations builds upon its evolving strategy of building a complete and robust electric vehicle (EV) ecosystem that started with aspirational cars (0 to 60 miles in 4.2 seconds), batteries with up to a 300 mile range, and supercharging stations. 

Innovations come in many forms forms the essence of Principle #5 of my recent book, Living in the Innovation Age (TekNirvana, 2011). I compare these forms of innovations to the concept of avatars of Lord Vishnu in Hinduism - each form unique and specifically designed for a purpose but none any better than the other. While most associate innovation with technology, a crucial and often necessary form of innovation occurs in business models, such as the Tesla switching stations described above. As Karan Girotra and Serguei Netessine discuss in their HBR blog, At Last, a New Business Model for Tesla, groundbreaking technology rarely achieves mass adoption without a corresponding innovation in the business model around the sale/use of the technology. I concur with the authors' assessment that these patterns extend far beyond Tesla — there are numerous innovative technologies that are waiting for an innovative business model that could facilitate their use and adoption.

The Bottom Line

Innovation has many forms. One such form is Business Model Innovation, which is often the catalyst that enables groundbreaking technology to achieve mass adoption. It is a well-known fact that much of Apple's iPod's success can be attributed to its business model innovation of the iTunes Platform. Such is the story with Tesla as well. Tesla realizes that it is not enough just to build a great electric car. In order to make their product truly useful, they are creating an entire ecosystem around it - long range batteries, supercharging stations, and now high speed battery swapping switching stations. So, will Tesla's switching station concept finally be the tipping point that will position its flagship product as the first all-electric, no-compromises, luxury sedan? Only time will tell...

Sony and "The First Mover Advantage Fallacy"

Sony's SmartWatch
Although first to market it might
only help competitors come up
with better offerings

One of the topics I discussed in my book, Living in the Innovation Age, is the fallacy of the first mover advantage. While there are cases where first movers have been highly successful, there are plenty of cases of disillusionment and despair as well. I used the meteoric success of TiVo followed by a decade of sagging profit as a case-in-point in my book. 

On October 12, I blogged about GM's failed attempts at capitalizing its first mover advantage with its early introduction of the redesigned "2013 Chevy Malibu" in February 2012. 

The May 6 - May 12 issue of Businessweek discusses yet another example of the so called first mover advantage fallacy. The victim this time? Sony. 

Sony introduced its first smart watch, LiveView, in 2010. As a new product in the growing and lucrative smart device marketplace, it was interesting but lacked in features and was mired with kinks. A more recent version called the SmartWatch is priced at $130, is about the size of an iPod nano, has a 1.3-inch touchscreen, and wirelessly connects to Android smartphones using Bluetooth technology. The gadget alerts users to incoming calls and allows them to reply to e-mails or texts with an array of pre-written messages. It even connects to Facebook and Twitter and controls a wearer’s phone-based music library. 

Sales are struggling though.

Sony’s failure to gain traction with the SmartWatch is the latest in a long line of first-mover advantages the electronics giant has squandered. Well known failures include the Clié, a Palm OS-based personal digital assistant that allowed users to listen to music, play games, and watch videos, which Sony introduced a year before Apple's iPod; a failed music platform similar to iTunes despite owning the distribution rights to thousands of popular songs and films; and an e-reader called the Portable Reader System, which Sony introduced a year ahead and with 600,000 titles, more than twice as many as Amazon’s Kindle.

Sources with inside knowledge of the company have attributed Sony's struggles to research that has been too inward-looking and deliberative and not focusing enough on early customer feedback. Perhaps Sony could learn and benefit from an increasingly popular concept known as the "Minimum Viable Product", which found its origins helping smaller entrepreneurial companies launch new products but seems equally applicable to larger companies such as Sony as well. 

The Bottom Line
Don't be too quick to assume a positive correlation between successful innovation and being first to market. As Mito Securities analyst Keita Wakabayashi puts it, "Sony was ahead of its rivals to release a watch, but it takes more than an idea to create a hit product. It’s about bringing a product that has functionalities that people would want and marketing the product in the right way.” So remember this the next time you have an innovative idea and instinctively want to rush to be first to market. You might just be helping out your competitors in the process...

Netflix - How it has "Innovated" itself out of the hole that nearly became its grave!

Netflix is near to my heart. Perhaps I am a bit biased but not because I love their $8.99 a month unlimited streaming plan that allows me to watch movies and TV shows to my heart's content. It's actually because I started Chapter 1 of my book, Living in the Innovation Age, with an interesting anecdote about Netflix that illustrated just how critical constant and continuous innovation is for all companies. Things looked pretty bleak for Netflix back in late 2011. About 18 months ago, Netflix was spending much time trying to save face. Netflix had awkwardly unveiled plans to raise prices and separate into two companies - a DVD mailer called Qwikster and a streaming entity still under the Netflix name - and lost millions of customers in the process. Not surprisingly, the share price fell from $298 to $52.81. Things were so bad that in a Saturday Night Live skit, Jason Sudeikis played the role of Netflix's CEO Hastings apologizing to consumers while at the same time unveiling increasingly complex businesses, culminating with Nutqwakflikster - a nut, insurance, and movie seller, mocking their recent Qwikster debacle.

But as I said, that was back in 2011. As documented in a recent Businessweek article, Netflix has mounted one of the all-time great comebacks. First quarter results show that revenue rose 18 percent from the same period last year to $1.02 billion, while the company added 2 million subscribers in the U.S. alone, dispelling widespread fears that its growth had slowed. And shares of Netflix are back above $200 being hailed as one of the best-performing stocks of the year. The article goes into quite a bit of depth on what has been going on at Netflix over the past 18 months.

Here are three key takeaways that I believe have contributed to their awe inspiring success:

Cloud Computing - Netflix has bet its future on cloud computing and Amazon's cloud platform. At any moment, Netflix draws upon 10,000 to 20,000 servers running in Amazon data centers somewhere. Being an early pioneer, Netflix has been forced to build from scratch much of the software it needs to survive. Since it relies on Amazon for data centers, its 700 engineers focus on coming up with tools for, say, automating the ways in which thousands of cloud servers get started and configured.

Original Shows - The biggest bets Netflix is making now are on its original shows. The company won’t disclose how much it paid for two seasons of House of Cards, though the Hollywood blog Deadline.com says it was about $100 million. Other original content includes Hemlock Grove, Arrested Development, and Orange Is the New Black.

Creativity and Innovation - Netflix is best known for the 1 million bounty that it offered to the person or group that could improve its ratings-based algorithm the most. A prime example of an open innovation contest, the winning team, a collection of independent engineers from around the world, built Netflix a better prediction engine. Netflix is always testing things - better recommendations, using avatars for interaction, voice guidance, etc. This mindset is at the crux of Principles 2 (Innovation is a Journey, Not a Destination) and 3 (Innovation is "Where No Man Has Gone Before") that I discuss in my aforementioned book.

The Bottom Line
Netflix is an excellent example of a company that has come back into relevance after everyone had given up on it. It did so, not by trying to doing the same things over again or finding new ways of cutting costs. Rather it rethought its business model with new technology platforms, new content, and new ideas. In other words, Netflix innovated! 

The Legal Side of Innovation - Who needs Soap Operas Anyway?

Over the past few months, I have written several blog posts about a topic that I call the "Legal Side of Innovation" and I first covered in my book, Living in the Innovation Age. The "Legal Side of Innovation" is a phenomenon in which companies are increasingly using patents and other intellectual property (IP) as a way of attacking each other in highly innovative and competitive areas such as smartphones and tablets. Essentially, IP law has become a double-edged sword that on the one hand protects an innovator's hard work and yet on the other hand creates impediments in the very road to innovation that it seeks to promote.

The legal battle between Apple and Samsung has become the technology world's version of steamy afternoon soap operas. As the never ending saga of twists and turns continues, Apple is now asking a court to force Google to turn over its Android source code as part of its patent litigation against Samsung. Apple, as part of its second patent-infringement lawsuit against Samsung, argues that Android is used in all of Samsung’s allegedly infringing products and “provides much of the accused functionality” in Apple’s claims. Meanwhile Matthew Warren, a lawyer for Google who also represents Samsung, claims that Apple made a “strategic decision” in filing its case “to keep Google off the complaint.” to ensure that Google doesn't have the same legal rights that Apple and Samsung have with respect to “reciprocal discovery.”

Now, isn't this a story that can match any of the love-hate triangles on today's soaps?!

The Bottom Line

By now none of us should have any doubts that the "Legal Side of Innovation" is real and here to stay. Hmmm... might be an interesting career opportunity here - a new caped crusader who is a dry, boring, attorney by day and a dynamic, cool innovator by night. :)

The "First Class" CIO - A Sequel

A few months back I had written a white paper on the struggles that CIOs face as they try to establish themselves as "equals amongst equals". In other words, many CIOs are viewed as second-tier executives in their organizations, less equal than other CXOs. The paper is aptly titled The "First Class" CIO - Three strategies to help ensure the CIO's seat at the executive table.

In the past few days, I have seen two blog entries in HBR on the same subject. The first entry, titled "How CIOs Can Keep In Step With CEOs", discusses the dissonance between corporate IT and the C-suite. The entry cites new research, conducted with HBR, The Economist, CEB, and TNS Global, which reveals that CEOs believe CIOs are not in sync with the new issues CEOs are facing. It states that CEOs often believe that CIOs do not understand where the business needs to go and how IT should support strategic goals. The second entry, titled "Three Ways CIOs Can Connect with the C-Suite", provides three simple steps CIOs can take to begin repairing the dissonance between business and IT, and guiding their organizations into the 21st century.

I hope you enjoy my white paper (if you have not read it already) and these two blog entries. I'd love to hear your thoughts on the subject.

Innovation Metrics

Innovation metrics is always a hot topic and a welcome ice breaker in any cocktail party (at least at my house). It's a topic that I discuss at length in my book, Living in the Innovation Age (TekNirvana, 2011). In Chapter 9, titled "Knowing What to Measure – Picking the Right Innovation Metrics", I explain how picking the correct mix of innovation metrics is key to inducing the desired behavior. That's because, as I explain in the chapter, what you measure will most certainly have an impact on how your organization behaves and views your innovation initiatives. Some of the more common innovation metrics include:

• Return on Investment (ROI)
• Total Research & Development (R&D) budget or total research and development headcount
• Number of ideas submitted by employees
• Percentage of sales from new products or services

While all of these metrics can be valuable for driving investment in innovation and evaluating results, each metric by itself provides a narrow view of the total innovation picture. Additionally, each metric by itself can induce both positive and negative behavior. For example, consider the seemingly straightforward and innocuous metric ROI. While ROI is most certainly a meaningful measure, it might cause an organization to avoid a potentially risky but highly lucrative market in the long term in favor of a lower potential but more measurable market in the short term.

Scott Anthony recently posted a blog entry titled "How To Really Measure a Company's Innovation Prowess" in HBR, which also addresses the topic of innovation metrics. Since the primary purpose of innovation for private companies is financial impact, Scott discusses Return on Innovation Investment (ROII) as a reasonable, aggregate measuring stick for innovation. Not surprisingly, ROII is calculated by taking the profits or cash flows produced by innovation and dividing that figure by the cumulative investment required to create those returns. ROII can be further sub-divided into three more micro metrics as follows:

1. Innovation magnitude (financial contribution divided by successful ideas)
2. Innovation success rate (successful ideas divided by total ideas explored)
3. Investment efficiency (ideas explored divided by total capital and operational investment)

While ROII and its sub-divided forms appear to be reasonable measures, the challenge is always having the data to actually calculate them. The lack of common definitions and publicly available statistics makes bench marking difficult. Simple questions, like "what defines an idea?" or "what does 'success' mean?" need to be answered in consistent ways - a concept that I discuss in my book as well.

The Bottom Line

Defining the right metrics for your innovation efforts is both an art and a science. It can especially be tricky since there is no single answer that is appropriate for every organization, which means that the optimal set of metrics will vary from company to company. Therefore, the best approach is to use a balanced mix of metrics that focus on the entire innovation life cycle from inputs to outcomes.

Let there be [more] light...

Innovation is not just a fancy term for entrepreneurs to make more money with new ideas and products. Innovation has real value in helping improve the lives of people and our society as a whole. This is an area that I focused on in my book, Living in the Innovation Age (TekNirvana, 2011). One fascinating example of this was how students from the Massachusetts Institute of Technology created the solar bottle bulb – a simple, yet effective innovation that costs less than $3 and only requires a one-liter soda bottle filled with a mixture of purified water and bleach to provide approximately 55 watts of daylight. This innovation solves a challenge faced in numerous poorer communities with cramped settlements of small metal roofed houses that do not get any sunlight in their homes.

Businessweek recently covered the story of an innovator who has created one more way that the poor can get clean and cheap light. Better yet, this one doesn't require daylight, which means it can provide light even after sunset. Kerosene lamps used in many developing countries in addition to posing fire hazards and injurious to health are also a major expense for many of the world’s estimated 1.5 billion families without electricity. Poor households typically spend at least 10 percent of their income on kerosene, as much as $36 billion a year worldwide, according to the World Bank. British industrial designer, Martin Riddiford, has figured out a way to use gravity instead of kerosene. He has created GravityLight - a pineapple-size lamp powered by a 25-pound weight that falls about six feet in a half-hour and shines slightly brighter than most kerosene lamps. The catch - once the weight reaches bottom, it must be manually lifted to repeat the process since GravityLight ingeniously uses human power stored as potential energy. GravityLight is slated to have its first field tests this summer in Africa, Asia, Latin America, and the Middle East. Once Riddiford’s team works out the final kinks, the basic model is expected to retail for about $5. Not bad at all.

The Bottom Line
Innovation can help proactively improve the quality of life for those less fortunate. Even simple innovations such as enabling members of poorer communities to get daylight in their homes or providing a safer, cleaner, and cheaper alternative to kerosene lamps can substantially improve the lives of those who live in under developed parts of the world.

Steve Jobs' Biggest Mistakes Exemplify the "Innovation Journey"

Principle #2 in my recent book, Living in the Innovation Age, states that innovation is a journey rather than a destination. I provide numerous examples of how successful innovators battled through a series of failures to ultimately succeed. The list includes individuals such as James Dyson (vacuum cleaners) and companies such as Google (social media). A recent HBR blog titled "Five of Steve Jobs's Biggest Mistakes" by Peter Sims provides yet another example of a highly successful innovator, Steve Jobs, who too battled epic failures of his own along his long and illustrious innovation journey.

Check out the complete blog posting here.

Now this is a "Reverse Innovation" that makes sense!

I bet this short story will bring a smile to your face. If not, I owe you another story :). There was a Japanese soap manufacturing company in which the soap blocks were made, then wrapped in wrapping paper automatically on the assembly conveyor belt, and finally packed in cartons. Typical Japanese automation at its best. Unfortunately, there were times when the wrapping machine created an empty packet without a soap inside. To rectify this problem the Japanese company bought an x-ray scanner from the US for $60,000 to check each packet on the assembly line and find the empty ones.

Not surprisingly, the empty packet challenge was not unique to the Japanese company. Nirma, a premier Indian soap manufacturer, faced a similar problem. Their solution was just a bit different and way cheaper. They simply bought a big fan (about $60) and placed it at the end of the assembly line. Problem solved: the empty wrappers without soap just blew away!

Now that's what I call a "Reverse Innovation" that makes sense to adopt worldwide! :)

HBR - Nine Rules for Stifling Innovation

We all talk about how to create a fertile culture to spur and encourage innovation.  In her recent blog posting, Rosabeth Moss Kanter has done a nice job of identifying nine ways to completely derail any innovation efforts whatsoever. They're actually quite funny, although if you are facing any of these where you work then you have my full sympathy...

The nine rules she identifies are summarized (and slightly paraphrased) below:

1. Be suspicious of any new idea from below. After all, if the idea were any good, we at the top would have thought of it already.
2. Invoke history. Find a precedent in a an earlier idea that didn't work, so it won't work this time either.
3. Keep people really busy. If they don't have free time, they won't try to think as much.
4. In the name of excellence, encourage cut-throat competition. Get groups to critique and challenge each other's proposals, preferably in public forums, and then declare winters and losers.
5. Stress predictability above all. Count everything that can be counted, and do it as often as possible.
6. Confine discussion of strategies and plans to a small circle of trusted advisors and make sudden, big announcements. 
7. Act as though punishing failure motivates success. That'll stop people from trying new things.
8. Blame all problems on the incompetent people below.
9. Keep reminding everyone that the top people already know everything there is to know about this business.

You can read the complete blog posting here.

Book Review - The Wide Lens

Why do many innovations fail? It is a question that baffles the best of us and keeps many a corporate executive awake at night. This anxiety is not unwarranted. Despite having a brilliant idea based on true customer insight and needs implemented with flawless execution, many innovations simply fail to meet the expectations set of them by their creators and by the market for which they were created. The Wide Lens by Ron Adner is a must read to gain insight into why that might be the case. In his thought provoking book, Adner explains how most innovation initiatives focus solely on managing the "execution" risk i.e. ensuring that a valid customer need exists, vetting the idea, and ensuring appropriate leadership and implementation. Adner explains that this "narrow lens" view is a root cause of why these innovators are blind sighted by failure. A "wide lens" view reveals two other major risks that need to be mitigated for success:

1. Co-innovation Risk - This risk represents the extent to which the successful commercialization of an innovation depends on the successful commercialization of other innovations. 
2. Adoption Chain Risk - This risk represents the extent to which partners and others will need to adopt the innovation before the end customer can reap the full benefit of the value proposition.

Adner illustrates these risks very clearly in explaining how Michelin’s big innovation in tires - the PAX System, which was designed to run for 125 miles after a blowout - failed to take off, despite the backing of major automakers, because the company failed to foresee the need for a robust network of service centers to repair these run-flat tires before going to market. The inability to service PAX tires and the resulting additional expenses incurred by consumers who had to buy new tires led to mass consumer backlash and even lawsuits that ultimately turned automakers off of these truly innovative tires. The PAX system falied because Michelin had failed to mitigate the adoption chain risk.

As Adner explains, co-innovation and adoption chain risks lurk in the blind spots of traditional strategy. They remain dormant as long as an innovation follows established lines (such as Michelin's successful introduction of Radial tires in the 1946). However, as soon as an innovation goes beyond being incremental in nature (such as the PAX tires), ecosystem challenges arise, which can only be addressed with a wide angle lens.

History is replete with examples of innovation failures that occurred despite brilliant execution. Nokia spent millions to be first to market with a 3G handset, but failed to profit because critical partners in its ecosystem did not complete their innovations in time. By the time customized video streaming, location based services, and automated payment systems were finally ready, so was the competition. Phillips suffered a similar fate as it tried to introduce HDTVs in the 1980s. And we are observing a similar dynamic with 3D TVs today. All of these are examples of failures stemming from the lack of "co-innovations" that need to happen for consumers to be able to realize the full benefits of an innovation's value proposition.

The Michelin story above illustrated an innovation's failure due to non adoption by a critical player in the ecosystem. Pfizer’s suffered a similar disastrous fate with its miraculous inhalable insulin, Exubera, which was approved by the FDA, hailed by Wall Street analysts, and launched with huge fanfare. The $2.8 billion write-off, widely acknowledged as one of the biggest failures in the history of the pharmaceutical industry, can be traced directly to endocrinologists not embracing the requirement of lung function testing imposed by the FDA.

Contrast the above examples of failure with two innovations that have been successful. Digital Cinema Initiative (DCI) is an example of a consortium of movie studios coming together in a unique way to overcome the cost of adopting digital film within the theater value chain. In essence, they subsidized and shared the cost of capital investment in smaller theater chains to ensure that digital film would enjoy the broad distribution and availability critical to its growth. It was a direct result of this innovation that director James Cameron was able to regale us with his 2009 blockbuster movie "Avatar". Amazon's success in the e-reader market with its Kindle product is also an example where Amazon overcame publisher reluctance by subsidizing their participation in addition to  robust digital rights management both of which Sony was unable to accomplish and therefore failed despite having a technically superior e-reader.

Finally, Adner provides insight into a topic that is near and dear to my heart - "The First Mover Advantage." In my recent book, Living in the Innovation Age, I talk about the fallacy of thinking that "only the first to market" reaps the benefits of innovation. Rather, there are many cases of second, third, and subsequent movers being successful where the first mover failed. Adner sheds further light on this matter by presenting a framework that one can use to determine whether they should even try to be the "first mover". Per this framework, it only pays to be the first mover if your innovation has very little dependency on the ecosystem. The more complex your innovation becomes and the more it depends on co-innovations and adoption, the less beneficial it is to be a first mover (i.e. the risk of moving first goes up significantly). In such cases, it is much more prudent to be a smart mover as Amazon was with its Kindle and Apple was with its iPod.

The Bottom Line

I highly recommend The Wide Lens to anyone involved in innovation strategies, commercialization and new business development. Its unique approach to analyzing that factors that contribute to the success and failure of complex innovations and the supporting tools (value blueprints, leadership prism, first mover matrix, supply chain reconfiguration levers, and minimum value footprint) are sure to, as Adner summarizes in his last chapter, "multiply your odds of success."