The Innovator’s Cookbook

I recently finished reading ‘The Innovator’s Cookbook‘, a collection of essays edited by Steven Johnson. From Low Road buildings as sites of innovation as postulated by Stewart Brand to venturesome consumption by users, a theory put forth by Amar Bhidé, the book has are some useful examples for anyone interested in business innovation and entrepreneurship. It’s the kind of book that has a vast sprinkling of case studies and management thoughts that can be rather useful every now and then – I suspect I will be re-reading it again fairly soon.

Here are some passages that stood out for me:

Disruptive innovations don’t initially perform well enough to be sold or used successfully in mainstream markets. But they have other attributes – most often simplicity, convenience, and low cost – that appeal to a new, small, and initially unattractive (to established firms) set of customers, who use them in new or low-end applications. The chances that a new company could become successful if its entry path was a sustaining strategy – trying to make a better product than the incumbents and selling it to the same customers – were about 6 percent in our study. The chances of success for firms that entered with a disruptive strategy were 33 percent. The disparity stems from the motivation and position of the leading firms. They have far more resources to throw at opportunities than entrants do. When newcomers attack customers and markets attractive to the leaders, the leaders overwhelm them.

– From the chapter ‘The Rules of Innovation’ by Clayton M. Christensen

If an innovation helps customers do things they are already trying to do more simply and conveniently, it has a higher probability of success. If it makes it easier for customers to do something they weren’t trying to do anyway, it will fail. Put differently, innovators should try to disrupt their competitors, never their customers.

– From the chapter ‘The Rules of Innovation’ by Clayton M. Christensen

On crowdsourcing innovation:

In essence, a company that turns its customers into innovators is outsourcing a valuable service that was once proprietary, and the change can be traumatic if that capability has long been a major source of competitive advantage. For example, a common problem is resistance from sales and marketing departments, which have traditionally been responsible for managing relationships with customers and providing first-class service to them. With tool kits, computer-to-computer interactions replace intense person-to-person contact during product development. In other words, customers who design products themselves have little need for a manufacturer’s sales or marketing department to determine what they need. If this change affects the compensation of sales representatives in the field, it could easily derail any efforts to alter the company’s business model. As a result, senior management needs to face these issues head on – for example, by determining how the sales and marketing functions should evolve and by using specific incentives to induce employees to support the transformation.

– From the chapter ‘Customers as Innovators: A New Way to Create Value’ by Stefan Thomke and Eric Von Hippel

In my personal experience, the people I’ve been around that are good at innovating are able to just keep these background threads alive so that they can bring them to the foreground when they do become relevant. They’re focused on one thing, but there are like nine things in the background. You never know when one of those things is going to suddenly jump to the foreground.

– Steven B. Johnson, asking Tom Kelley a question on ‘the background process’.

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