In this article, Abraham and Knight emphasize the need for management to tap into unrealized potential. They attribute the oversight to management’s failure to look in the right places. With the landscape of business changing, management must move away from what they call the “industrial mentality”, which seeks to routinize business processes in order to decrease cost. They believe that management should instead focus on performance improvement through the implementation of a “Mega-Strategy”. This is described as a strategic innovation plan that creates and expands new markets. The problem they see is that very few managers know how to use the approach.
In order to understand the application of strategic innovation, firms must first have a solid understating of the three levels of change and must know how to react to them. To illustrate change, the article uses the S-curve model to show how an organization grows, matures, and progresses over time. This is the life cycle all organizations go through time and again. At the end of each life cycle an organization must develop a strategy that will carry the business through to the next cycle. However, before change can occur, the article states that three conditions must exist: (1) There must be a reason for a change to occur, (2) leadership must commit and provide the necessary resources, and (3) the strategic innovation process must provide the approach. Markides, C. (1997). Strategic innovation. Sloan Management Review, 38(3), 9-23. Retrieved from http://search.proquest.com/docview/224975242?accountid=35812
This article discusses the common element among some of the most notable success stories in business. The common element being the successful implementation of strategic innovation, or as this article refers to it, the strategy of breaking the rules. Many of the businesses highlighted in the article attacked established industry leaders and succeeded in taking over the market share within a few years. They did so not with new technologies, but by changing the rules of how the business game was played. The organization’s that succeeded did so because they were able to find the gaps in the industry-positioning map and exploit them rather than letting those segments of the market be underserved and undervalued.
The article states that in order to be successful, organizations must first systematically adopt a new game plan. The game plan requires the organization to first redefine its business. Second, redefine who its customers are. Third, redefine what the product or service is they are looking to offer the customer. Fourth, redefine how it will use its strengths to add value to either products or processes. Finally, look at organization from different points, most importantly which customer needs the organization can satisfy as opposed to only focusing on what the customer wants. Power, D. (2015). Innovation Strategy: 4 Key Tactics of Top Growth Companies. The Language of Business. Retrieved from http://www.dce.harvard.edu/professional/blog/innovation-strategy-4-key-tactics-top-growth-companies
This article discusses the four best practices that successful growth companies adopt. The fist of these is the organizations ability to find the S-curve. The S-curve is a products life cycle. Leaders must be able to identify the inflection point, or innovation window, in order to develop a new growth strategy. The second best practice is an organizations ability to “lean” on its customers. This is where employees of the organization make real contact with its customers. If an organization does not have a real idea of what its customer’s wants and needs are, then they have no idea where to set their sights.
They risk developing a product or service that is useless to the customer and costly for the organization. The third best practice is the ability to think like a designer. The article states that management must rely on its talent to make the decision rather than relying on leadership decision. Each area of the organization must be given the ability to make decisions that align with their strengths. The final best practice is the organizations ability to lead the way. The organizations leadership must set the example in making innovation a priority. Without the proper backing from leadership, the organization will like fail in its attempts.
In recent years, innovation has been at the forefront of business practices. Organizations have tried to come up with the next big thing in their respective industries in an effort to remain viable and relevant. In conducting the literature review for this assignment some of the strategic management trends that are being shaped by innovation is the shift in culture towards one that fosters innovation as a key strategic imperative. This means that organizations are now creating processes for innovative thinking throughout the organization through the development of teams and work hours strictly dedicated to innovation.
In addition, many organizations are defining what innovation means to their organization. They are redefining the generic definition so that it aligns with their business and its practices. Some of the most influential aspects of innovation that are shaping strategic management is the manner in which organization are looking at processes. Innovation no longer means a new product or service, but how existing products and services are introduced to the market through the utilization of various supply chains. Organizations are beginning to understand that viability means innovative thinking during the times between new products and services not only during the unveiling of new technologies. Innovation and strategic management are merging in the post-industrial era to help solve the problems of the 21st century.