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Seven Strong Reasons not to Innovate

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If you want to stop your organisation from trying to develop significant new products or services then here are seven solid arguments you can rely on.

  1. We are successful. We are growing and making a modest profit.  Innovations absorb resources and cost money. Why should we distract ourselves and mess with success?
  2. Everyone is very busy. All staff are working hard on urgent tasks sorting out today’s problems.  They do not have spare bandwidth to experiment with new ideas.
  3. Innovation is risky. Most radical innovations fail so let’s just keep making our current products and services better.
  4. We don’t like failure. It would be bad for morale if we launched a new product which flopped and it would be bad for the careers of those who were responsible for failure.
  5. We tried it before and it did not work. Last year we spent a lot of time and money on a major new venture which never made a profit and had to be discontinued.  It was a painful and costly experience.
  6. Customers are not asking for it. We have surveyed our customers and they like our current offerings.  They have indicated some incremental improvements which we are working on.  No customers have asked for a radical new approach.
  7. There is a still a lot of scope to improve our current business model. Let’s just get the existing operation working really well and smooth out all the issues.  Then later when everything is going well we can try some experiments.

All of the statements above are probably true to a greater or lesser extent.  This is why getting real momentum behind significant innovation is difficult.  The leader has to combat these arguments and instil a sense of urgency.  He or she must sell the need for innovation.  Let’s look at the counter arguments.

  1. We are successful and that is something we can be proud of. But current success is no guarantee of success or even survival in the future.  Just look at Kodak.  If we do not innovate our competitors will find ways to overtake us.  We cannot afford to be complacent.
  2. Everyone is busy but we have to find time and resources for innovation. Highly innovative companies like Google allocate up to 20% of employees’ time for exploration of new initiatives.  We have to free up some key people for innovation projects.  We can do that by setting priorities and eliminating lower value tasks.
  3. Innovation is risky but so is standing still. If we want to succeed we have to play in the game and take some risks.
  4. We have to change our attitude to failure and see it as a learning opportunity and a step on the road to success. We have to accept a level of failure.  All innovative companies have failures – look at the Amazon Fire.  That does not stop them from constantly trying new things.
  5. Yes we had a failed initiative but what did we learn from it? If we gained some important insights then we can use those to do better next time.  We need to improve our gating process so that we can identify problems early and preferably before launch.
  6. Customers are notoriously poor at indicating radical innovations which is one reason why Steve Jobs disdained focus groups. Blackberry users loved their Blackberries but eventually they all melted away to Apple or Samsung.
  7. There is plenty of scope for improvement in current operations and it is important that we fix the problems and keep making incremental improvements. However, that does not preclude major creative initiatives.  We can do both simultaneously.  We can improve our current products and at the same time plan to replace them with innovative new designs.

Busyness, success, complacency and risk aversion are major enemies of innovation.  It is the task of the leader and the executive team to communicate the need for innovation and the vision of a better and different future for the organisation.

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3 thoughts on “Seven Strong Reasons not to Innovate

  1. This is a great post. It leaves me hanging without a thought of whether to innovate or not, especially that in most cases we see innovation as a necessary thing to do. But the arguments really make sense. I think it will boil down to knowing your kind of business and how is it going now. If it the kind that can stand firm in the market without innovations then okay. But if you are in the industry that is constantly changing then definitely you need to innovate.

  2. Great post. There can be 70 more stronger reasons for not to innovate. Status quo organizations are bound to get wiped out and get closed.
    What is innovation then for any organization to embrace? Customer driven innovation is a knee jerk response. Creating fresh customers is the key. Next is cost reduction, efficiency improvement, wastage reduction, service automation and marketing are all new schemes of innovation.
    Even as so called, stagnant industry like agriculture is constantly developing with technology and research. So innovate to survive. Regards

  3. Paul – in case you have not seen it – there is an excellent article on the Kodak moment by Bill Fischer = tps://www.forbes.com/sites/billfischer/2014/07/04/there-are-no-kodak-moments/#681582798fd6

    his key points were
    • Not Kodak moments but Kodak decades, a process of creping disruption. Change normally comes slowly. A new technology is invented, initially it is not practicable or economic, then it evolves until it becomes better than the previous technology and then it takes over. This is what happened to the photo business – people wanted images but were not concerned as to how they were made
    • Substitution need not be complete to hurt the business of the incumbents. In fact most substitutions are partial, at least at first, but they hurt enough damage the cash flows of the old technology companies as demand declines. Incumbent technologies would often need to compete on price with profit margins declining quickly.
    • The interests of the key stakeholders in an incumbent technology company may conflict with the long term strategic future. The old technology model used to work well and firms may neglect new technologies to focus on squeezing profits from the old business that they know and love. “giving up an uncertain future or the successful past”
    • Past success is often the biggest inhibitor of future success. Being the successful incumbent in the prior generation of offerings is typically the most telling predictor of future failure in the next. Companies find it very difficult to change from what they are good at. Fear of cannibalising existing streams of cash-flow leads to denial and hesitancy when the early signs of disruption first appear. When the unthinkable happens to firms that are now suddenly vulnerable to disruption, they don’t think.
    • Obvious, but needs saying. Substitution is typically an industry phenomenon, not the failure of a single firm. The disruptive forces will hit all of the players in an industry at the same time. As a result, benchmarking your performance against your incumbent peers is probably an excellent way to set an entire industry’s leadership up for a big and bad surprise, all at once.
    • The brand alone is not enough to withstand disruption – Kodak after all was one of the world’s great brands

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