Innovate or die seems to be the business maxim of the day. In a 2012 IBM survey, CEOs named product and service innovation among the three most important sources of sustaining economic value for their businesses. Perhaps more telling is that 71 percent of the CEOs of outperforming businesses were expanding their partner networks in pursuit of innovation.
Innovation is a messy and expensive business, and the gap between the desire to innovate and the ability to do it well is huge. But there’s plenty of evidence pointing to its necessity: Brands are at risk going out of business, like the RadioShacks of the world, or becoming shadows of their former selves like Kodak. These companies biggest threats often are not known competitors, but disruptors such as Uber, Amazon and Tesla.
In the world of innovation anything is possible, but everything is not. And innovation without a starting point will burn infinite resources. If you want innovation to work for you, and not consume you, you need to get to work.
Imagine the future.
Where do you begin? A truly innovative company doesn’t start with a blank sheet, but rather with its story, the narrative and the quest of the brand. It has an expansive view of the business it’s in, and that view is typically bigger than the category where it currently competes. It also has a larger purpose and everything it does is in pursuit of that mission.
An innovative company doesn’t follow the latest consumer trends or try to outpace the known competition. It imagines its future based on its quest – a vision that becomes its blueprint and then it goes on to create that future. We call it quest-led innovation.
Nike has been in the business of quest-led innovation for more than 50 years. It started out small, making shoes for people who loved to run, but its ambition was much bigger. Nike’s quest is to bring inspiration and innovation to the athlete in all of us. That ambition has always framed and focused the company, starting with technically better athletic shoes and the famous waffle-tread shoe, and most recently expanding into the digital platform space with Nike+.
Nike no longer just builds great shoes for runners, it builds and creates the software that enables runners – 7 million worldwide – to track, measure, compare and share their runs. This demanded new capabilities, a digital sports division, and new investments in talent. These investments are made all in service of its quest, a quest that brought both focus and the freedom to expand outside the category.
Nike doesn’t ask how can it make better sports shoes, it asks how can Nike inspire more people to be better athletes. Imagine if Kodak had broadened its aperture and saw itself not as in the film business but in the business of photography, of capturing, sharing and preserving memories. How different might its fate have been? The company could have led the digital photography revolution and perhaps even started a digital platform such as Instagram.
Know what stands in the way.
Companies with great quests usually have a clear enemy. Many people believe that Tesla’s enemy is the car business, but in fact its enemy is much bigger – the mine-and-burn-carbon economy. Tesla is on a quest to accelerate the electric economy of the future, the pursuit of which has disputed the car business but will likely disrupt many more. The company is relentless in that desire, starting with making petroleum-free travel a reality.
It built the beautiful Model S to inspire and learn about sustainable transportation, it created a revolutionary infrastructure of charging stations designed to make seamless electric vehicle travel for 98 percent of the U.S. population. And in an unprecedented move in the hyper-competitive car business, Tesla opened up its patents so its competitors could start building cars to take advantage of that network.
The company’s latest industry disruption has moved Tesla from our roads and into our homes with Powerwall systems designed to create energy storage for sustainable homes. Tesla is just beginning its journey of disruption in its desire to end the mine-and-burn-carbon economy, much in the same way that Amazon began by disrupting the book business and now disrupts all retailers on its quest to becoming the biggest marketplace in the world.
YouTube just celebrated its 10th birthday. Since its inception it has been on a quest to empower the world to create, broadcast and share. In doing so, it has broken down the walls between creators and fans, enabling everyone to participate, collaborate and create the video economy of the future. The quest started with a platform for those videos to be uploaded, discovered and shared. YouTube went on to create production studios in major cities such as London and L.A., where its creators could have access to some of the best technology and production sets and tools available.
Everything YouTube does is focused around its homegrown talent and fans. What if RadioShack had thought of itself as the home for makers, tinkerers and hackers – not just a place to buy electronic stuff, but a marketplace for nerds, a place to make and maybe distribute its own products? I suspect its destiny would have looked very different
Innovating around the quest of your brand brings focus and helps to sort the wheat from the chaff, to filter the right ideas from the good ideas. It creates white space, adjacencies that may not seem immediately obvious but are likely the places where the disrupters will emerge and the big battles will be won or lost. It enables you to focus your precious resources on fewer, better things, to move faster and in the right direction, to be out ahead of the competition, known and unknown.
Quest-led innovation makes anything possible in a world where everything is not.