Real Sources of Value: Innovation and Speed
If someone were to ask me what is the greatest strategic advantage any organization can have in the global marketplace? My response would be INNOVATION. Innovation is one of the greatest generators of value. Innovation can lead to new markets, new customers, new products; all of which generates a lot of value. Unfortunately, innovation is very difficult to achieve. One of the best places to find innovation is in France. The French are great at innovation, everything from eye surgery to flat free tires. Because of this incredible level of innovation, the French economy has the largest trade surplus of any nation.
So how do the French generate so much innovation? Well think about how the French approach business. They are very visual in how they solve problems; i.e. use gauges and pictures to explain and solve problems (Balanced Scorecard). The French allocate lots of time to creative thought, not to creative work. In fact the French tend to minimize work; they almost have a disdain for work. Because of this freedom, the French can react quickly to market conditions without having "work" get in the way. And remember what Tom Peters and others keep preaching: It's the fast over the slow that will survive in the future, not the big over the small.
The ability to react quickly to events, customers, markets, new technologies, and other issues can make or break companies in the future. For example, years ago Bill Gates, founder of Microsoft, dismissed the Internet as inconsequential. Year's later Mr. Gates changed his views on the future of internet. What's so amazing is that Microsoft (a very large company) was able to change directions so quickly. The ability to move fast is paramount to survival in the future.
Finally, you have got to create an environment that is conducive to creativity. This requires that you break down barriers and free people up so they can be creative. For example, one company discarded most of its personnel policy and replaced it with a single sentence on one page: "Use Your Best Judgement." Other companies are evolving into virtual organizations by having the customer run the company, not the CEO. Also recognize the importance of failure. Failure is normal and it usually comes before success. Remember innovation comes from some unusual places. You have to break away from old ideas, old values, and the status quo. Don't be afraid to challenge what is going on.
Written by: Matt H. Evans, CPA, CMA, CFM | Email: firstname.lastname@example.org | Phone: 1-877-807-8756