This chapter has covered the first element of the Pentathlon Framework – innovation strategy. We have discussed the various factors, some subtle and some not so subtle, that demand innovative change. These have the common feature that they stem from the blocking of preexisting routes to competitive advantage either through loss of scope for improvement or through satisfaction of market demand. Different analytical tools are appropriate depending on the type of uncertainty being faced, for example Scenario Planning, Roadmapping, Strategic Landscape mapping and the Business Model Canvas.
Innovation strategy must look well into the future because the need for innovative change often comes from slowly developing trends, which may be difficult to recognize and respond to. Among these are the competence ceiling and feature fatigue, which opens the threat from disruptive technologies. We introduced Kano’s classification as a useful structure for understanding these and discussed responses to them. Business model innovations such as value innovation and blue ocean strategies must also be considered as possible strategies.
Finding barriers such as IPR to defend innovations from competition is important, but strong complementary assets are required in the long run.
Interview with Nigel Bond
Plan well ahead, using tools such as roadmapping and scenarios that encourage participation from all concerned.
Be ready to innovate in all parts of the business model.
Understand the limits of your existing technologies or competences and be clear whether these limits may put the organization at a competitive disadvantage.
Be alert to the possibility that the market’s demand for further improvements to existing products and services may be not as strong as it was. Avoid going further than required and find new sources of competitive advantage as the old run out.
Consider early on how to defend your innovation from competition.
Recognize how the management style and focus for success in established businesses is inimical to new ones. Set up separate activities for new businesses as far as possible.