Four changes in the business world in 2020

These four trends will drive new business ideas and innovations.

PER PAUL SCHOEMAKER , SENIOR RESEARCHER AND EX-RESEARCH DIRECTOR OF WHITEON'S MACK INSTITUTE

When the world changes at an impressive rate, innovation becomes an organization's most important weapon. The story gives some important lessons on how to wield this weapon in the future.

In this article, it is highlighted that the innovation process, by itself, is transforming “from the outside in”, in addition to other important trends.

First, when thinking about the future of innovation, it is instructive to look back, as it shows that significant innovations have occurred in the innovation process itself. Second, companies have moved from innovation from the inside out, where companies rely on essential forces to conquer adjacencies and open innovation. 

For example, P&G is an excellent case of this profound trend. In the past, almost all innovation came from P&G; most innovations now originate from outside, using an approach called “connect and develop”. This trend will continue some more highlighted below.

Quantum Innovation

First of all, Google's approach is an excellent example of “quantum innovation”, which is defined as a ready-to-use thinking that gets in the way of competitors and even the company itself. The paradigm shift underlying innovations almost never fits the current business model and organization structure. First it starts with a very broad sense of purpose and audacious goals, like Google’s desire to organize knowledge of the world or Tesla’s desire to make ordinary electric cars. That's what entrepreneurs like Richard Branson (Virgin), Elon Musk (SpaceX and Telsa), Sarah Blakey (Spanx) and John Mackey (WholeFoods) stand out. The Cancer Treatment Center of America is also doing this, rethinking the world of cancer care, with the patient first in everything that happens.

New organizational forms

The traditional work environment from 9 to 5, Monday to Friday, is giving way to many new organizational forms. Whereas now we see virtual companies; internal and external network partnerships (think Uber and Airbnb); and companies that create new startups. Other new ways include ambidextrous organizations, which can focus on existing products and, at the same time, accompany the creation of new products or markets, and front-to-back companies, which place the customer at the center of all their activities. Finally, there are “sensitivity and response” companies, such as Zara, a retailer that quickly translates fashion trends into a shipment of new products twice a week. Anyway, this flood of innovation in organizational forms will continue to be fueled by technology and new approaches to the balance between professional and personal life. 

Reverse Innovation 

Primarily, globalization and outsourcing have led to “reverse innovation”, since the world is no longer a one-way street of outsourcing that moves from west to east. While the West still exports many high-end products and services to developing countries (and still generates cheap labor), innovations in emerging markets are now also returning to the West. This is happening with Brazil, China and India in fields as diverse as biofuels, IT and medicine. New approaches to making cheap artificial hips in India, for example, are returning to the US and Europe. In addition, reverse innovation generally means frugal innovation, which is welcome in a world where access to capital, land, labor and natural resources has become a pressing business issue that is urgently linked to sustainability.

https://forti1.com/o-relevancia-da-gestao-de-ativos-de-ti/

Reaping errors

Many discoveries arose out of a sequence of errors or failures. Definitely, not all mistakes are bad; since many are portals of discovery. The adoption of a more error-tolerant mindset paves the way for testing new processes and projects, even those that may not seem promising at first. From the same point of view, many successful innovations do not happen until they are nurtured at an early stage and withstand many setbacks, failures and adjustments. As Honda's founder noted, “Success is a failure of 99%”. Rather than waiting for brilliant mistakes to happen, leading companies can actually encourage deliberate mistakes, defined as tests beyond their belief system - just to see. Such experiments cannot be justified using rational cost-benefit analysis. Therefore, they demand leaders and a culture that sees mistakes as a portal of discovery.

How to innovate for the future

When the world is changing at breakneck speed, innovation becomes an organization's most important weapon. The story offers some important lessons on how to handle this weapon in the future:

  • The world is a big place: don't just limit yourself to innovation from within your company.
  • High goal: otherwise, incremental innovation can cause you to miss out on innovative opportunities.
  • Try new organizational structures that are agile and horizontal.
  • Practice economic innovation and learn from both the bottom of the pyramid and the top.
  • See errors as portals of discovery: every failure has learning as a positive side.
  • Cultivate leaders who thrive on uncertainty, take a long-term view and advocate for change.

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