Business Strategy | Leadership / Management

Do you have what it takes to innovate?

Innovate Is innovation important? And why is it coming up so frequently in conversations?

I think the answer has a lot to do with what we are all referring to as the "new normal" -- this period after the Great Recession of 2008 (and 2009 and 2010) in which rapid change and complexity are the norms, in which we feel like we are living in an era of permanent whitewater.

The challenge for leaders is to be able to keep one eye on the present, pushing the current business to its highest potential, and the other eye on the horizon, placing careful bets on the future.

That is why I loved the latest edition of FastCompany magazine and its focus on the World's 50 Most Innovative Companies.

The magazine starts with this intro:

"The 50 companies on our 2011 list have chosen a unique path. Today's business landscape is littered with heritage companies whose CEOs battle their industry's broken model with inertia, layoffs, lawsuits -- anything that squeezes pennies and delays the inevitable. How many of these companies will be dominant in 2025? Few."

Here is what they say it takes to be a top innovator:

  1. They are willing to scrap conventional ideas.
  2. They are willing to fail. (See our post, Failure: The first step toward success.)
  3. They know what they stand for (vision, culture and values).

Here are the world's top 5 innovators, according to FastCompany:

  1. Apple
  2. Twitter
  3. Facebook
  4. Nissan
  5. Groupon

Should you start innovating in this uncertain environment?

Listen to the advice of Rita McGrath, co-author of a great book for CPAs thinking about innovation, titled, Discovery-Driven Growth: A Breakthrough Process to Reduce Risk and Seize Opportunity (with co-author Ian MacMillan, who will be speaking at the MACPA's Business and Industry Conference in May 2011).

"Think of it a bit like momentum," said McGrath, a professor at the Columbia Business School in New York and a renowned thought leader on strategy in volatile and uncertain environments. "If you start a race from a dead stop, you're much less likely to get up to speed fast than someone who's already moving. With growth, you have a similar phenomenon. Those who start making those investments today, those who start removing some of the structural barriers (to growth) are going to be that much more in motion than companies that have been at a dead stop for the past few years.

"Plus, it's more fun,” she added. “It's more fun for your people, it's more fun for yourself to be thinking of doing something new rather than the same old thing. Once you're focused on growth, people start to see opportunities more readily because they're actively thinking about it. People are less likely to cling to the past if they see that there are opportunities in the future that they could be going after."

That's an excerpt from Can't Afford to Grow? You Can't Afford Not To, an article in the Baltimore Business Journal by the MACPA's Bill Sheridan.

Listen to Bill's podcast interview with Rita, Business Growth in Uncertain Times. I listen to this over and over!

Then tell us what is your take on the key's to innovation (comment below).