OPINION
By
Kosheek Sewchurran,
University of Cape Town
In their book Business
Model Generation, authors Alexander Osterwalder and Yves Pigneur explore
the power of asking "what if" questions. This is illustrated by the
example of furniture giant IKEA. In 1960 it asked:
What if customers bought furniture in components in a box
and assembled it themselves?
The idea was unheard of at the time. Today it's common
practice in the furniture industry.
Another "what if" example given by the authors
is telecommunications app Skype. It provides free voice calls worldwide and is
believed to have earned US$2 billion in 2013. Not bad for a "free" service.
But the company asked an important question when it was
setting up - what if while most of its services were free, it also made room
for monthly subscriptions and Skype credit which could be used to make calls
and send text messages to non-Skype members? It did, and this is where Skype is
making its money.
Many businesses are taking strain in a tumultuous global
economy. Adopting a genuinely innovative mindset to business can help in this
unstable economic landscape. Such a model helps to promote innovative thinking
and creative approaches to sticky problems - a new capability that businesses
need in abundance.
Why innovation matters
The essence of this model involves rethinking the
ingrained style of an organisation's practices, its mechanisms for creating
value and how value is produced. It also involves creating new styles that can
be adopted when the time is right - not simply evaluating options and avoiding
the worst of these.
Importantly,
all of the options are carefully tested before being applied, usually in
low-cost experiments and while proven models are still in place. Organisations
that do this well are often referred to as design-thinking or ambidextrous.
They essentially balance the resource allocation and organisational focus on
both exploring new models and reliably executing current working models.
With all of this in mind, here are three key lessons that
truly innovative businesses have already learned.
Listen to your stakeholders
Companies should embrace any opportunity to listen to
their customers, staff and others connected to making the organisation work.
Listening to others can help reframe challenges and
create new ways of looking at old problems, leading to new choices. This can be
one of the most fundamentally powerful techniques any executive can learn.
Research confirms that consultation is a key factor in successful innovation. Or,
to put it another way, impatience is often the biggest obstacle to innovation:
too many people want to rush towards solutions instead of taking the time to
properly examine and understand the situation.
Genuinely thinking about a system - a university or a
business - allows those involved to make sense of the mess and bring its
inter-connectedness to the fore by engaging the stakeholders. This typically
leads to more authentic participation and creative action.
Capitalise on
crises
A crisis creates disharmony or anomaly, and this is a key
raw material for innovation.
For this material to be productively used, though, people
must have a degree of mastery in design thinking, integrative thinking and
systems thinking. And they need to learn to be comfortable in the chaos - or at
least have the courage to sit with the discomfort of chaos to see what emerges.
But it can be very challenging to overcome fear in the
business world. In times of crisis, organisations do not want to take risks.
They want to stay safe and comfortable.
The rewards for those who do take the plunge are
considerable, as proved by well-known companies like Naspers. Once the mouthpiece
of apartheid and a publisher of traditional newspapers it has, over the years, transformed itself into a cutting-edge, tech-savvy
multinational. How? Through innovation and risk even in times of uncertainty.
Create an innovation culture
In their book Solving Problems with Design Thinking, Jeanne Liedtka, Andrew
King and Kevin Bennett suggest that the highest payoff in most organisations
doesn't lie in innovating a solution. Instead, it lies with innovating how
people work together to implement the new possibility they see amid
organisational inertia, bureaucracy and risk aversion.
Business
model innovation is a powerful and practical mechanism for establishing a
culture of change in a company. By combining theory and practical application,
individuals are guided towards coming up with solutions for their business
environment. Techniques like generative reasoning, causal modelling, assertive
enquiry, design thinking and integrated thinking are combined to get the best
results.
These techniques drive people to really question the
fundamental assumptions ingrained in an institution's processes with an eye on
how to improve these. They provide a robust framework within which people can
think about change.
The sky is the limit
The enduring value of business-model innovation lies in
its ability to change mindsets and behaviours. It shifts an organisation's
thinking from problem-solving to solution-finding mode. These may sound like
ostensibly the same thing, but they are fundamentally and powerfully different.
One is focused on the problem and the other is about
opening up the mind to explore new possibilities.
And, as any innovation business knows, once you open up
to possibility then the sky is the limit in terms of what can be achieved.
Disclosure statement
Kosheek Sewchurran does not work for, consult, own shares
in or receive funding from any company or organization that would benefit from
this article, and has disclosed no relevant affiliations beyond the academic
appointment above.
Read the original
article on The
Conversation Africa.
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