Source of innovation
3. Source of Innovation 1: Unexpected Success and Failures
According to Drucker, the best source for successful innovation is from an Unexpected Success or Failure. Exploitation of this requires analysis simply because an unexpected success is a symptom. For example: A competitor is having unexpected success in a particular market segment. Management must find out why this is happening, asking themselves what it would mean to them if they exploited it.
Unexpected Failures can also lead to other opportunities for innovation as suggested by the following quotation by a former CEO of Johnson and Johnson: “Failure is our most important product.”
R. W. Johnson, Jr., Former CEO, Johnson & Johnson (1954) As an example, the Ford Motor Company developed a new automobile, the Edsel, in 1957. The auto's design stemmed from extensive market research about customer preferences in appearance and styling, yet the Edsel became a total failure immediately after it was introduced. Barely a soul wanted it.
Instead of blaming the "irrational consumer", Ford's management decided there was something happening that was not in line with general auto-industry assumptions about the reality of consumer behavior. After reinvestigating the market, they discovered a new "lifestyle segment" to which they quickly responded by producing the superbly designed and produced Thunderbird model - one of the greatest successes in US auto history. Will the highly acclaimed innovation, the GM Chevy Volt follow in the footsteps of the Edsel should be interesting to follow?
“You can learn from success, but you have to work at it; It’s a lot easier to learn from failure.”
Lewis Lehr, Former CEO – 3M Corporation
2: Incongruities
Drucker described an incongruity as a discrepancy, a dissonance, between what is and what "ought" to be, or between what is and what everybody assumes it to be. Like the unexpected event, whether success or failure, an incongruity is a symptom
According to Drucker, the best source for successful innovation is from an Unexpected Success or Failure. Exploitation of this requires analysis simply because an unexpected success is a symptom. For example: A competitor is having unexpected success in a particular market segment. Management must find out why this is happening, asking themselves what it would mean to them if they exploited it.
Unexpected Failures can also lead to other opportunities for innovation as suggested by the following quotation by a former CEO of Johnson and Johnson: “Failure is our most important product.”
R. W. Johnson, Jr., Former CEO, Johnson & Johnson (1954) As an example, the Ford Motor Company developed a new automobile, the Edsel, in 1957. The auto's design stemmed from extensive market research about customer preferences in appearance and styling, yet the Edsel became a total failure immediately after it was introduced. Barely a soul wanted it.
Instead of blaming the "irrational consumer", Ford's management decided there was something happening that was not in line with general auto-industry assumptions about the reality of consumer behavior. After reinvestigating the market, they discovered a new "lifestyle segment" to which they quickly responded by producing the superbly designed and produced Thunderbird model - one of the greatest successes in US auto history. Will the highly acclaimed innovation, the GM Chevy Volt follow in the footsteps of the Edsel should be interesting to follow?
“You can learn from success, but you have to work at it; It’s a lot easier to learn from failure.”
Lewis Lehr, Former CEO – 3M Corporation
2: Incongruities
Drucker described an incongruity as a discrepancy, a dissonance, between what is and what "ought" to be, or between what is and what everybody assumes it to be. Like the unexpected event, whether success or failure, an incongruity is a symptom