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What is radical, what is disruptive?

Greg Satell points out the definition of disruptive innovation unfolded 10 years ago by Clayton Christensen in The Innovator’s Dilemma: ‘Great firms get disrupted and fail when they got blindsided by a completely new market’. Greg notes that disruption can ‘start with a product worse from a traditional standpoint, but performing better in areas such as price or convenience: a new market would then develop, the new upstarts will serve a different kind of customer that seemed tangential, niche and less profitable to incumbent firms’.

When radical innovation is about technological leapfrogging, disruption brings a new market to the landscape, explains similarly Venkatesh Rao. In other words, the CD is a radical innovation (great technology, same players shoot again, with better margins) while the MP3 is a disruptive innovation (value shift, complete recomposition of the market, incumbent players get disrupted).

I have in mind 2 additional perspectives…

[Excerpt, click on the link to read the rest of this post.]

PatientsLikeMe, a social network that lets patients share health information with each other online, has announced it is piloting a medical research platform that lets researchers test new methods for measuring patient outcomes.

Funded by the Robert Wood Johnson Foundation, PatientsLikeMe’s Open Research Exchange allows researchers “to pilot, deploy, share, and validate new ways to measure diseases within PatientsLikeMe’s community of more than 200,000 members,” according to a news release. The researchers might be from academia or pharmaceutical companies, said Paul Wicks, PatientsLikeMe’s research and development director, in an interview with InformationWeek Healthcare.

[Excerpt, click on the link to read the rest of this post.]

What is a business model canvas? Wikipedia defines it as “a strategic management template for developing new or documenting existing business models”. It is not a business plan, but rather a visual language designed to align business activities that produce value by illustrating potential trade-offs. The idea was initially proposed by Alexander Osterwalder.

A business model canvas for the American healthcare system…

Phase 1 of the modelH Co-Creation Forum aims to create a business model canvas specifically for healthcare. To do so we must first agree on what defines value within the American healthcare ecosystem. Our definition of value is based on Michael Porter’s work in What is Value in Health Care? — “The patient health outcome achieved per healthcare dollar spent.”

Therefore, a value-based healthcare business model must result in:

- Increased access to necessary care through an engaged delivery system;
- Reduced aggregate cost of care, with a market-driven, balanced incentive and reward model; and
- Improved consumer experience yielding an informed decision maker aligned to their risk and reward.

Our healthcare business model canvas, which we are calling modelH, must also work in a market-driven system. Better ideas can then be generated and evaluated using that engine because they:

1) create shared value and
2) can succeed in the marketplace. Likewise, current models and trends can be evaluated through this engine to see if they are effective.

The basis for modelH is Alex Osterwalder’s work on business model generation, but modified to fit the uniqueness of the American healthcare domain. Our community will participate in modifying the Osterwalder model as needed to create the modelH Healthcare Business Model Canvas.

[Excerpt, click on the link to read this post, and you’ll also be able to find the links there for parts 1 and 2.]

Overcoming people’s past perceptions of you isn’t easy. When I launched my consulting business seven years ago, I was astonished to find — years later — that acquaintances and even friends hadn’t kept up with my career transition. They’d ask about my past work in politics or nonprofit advocacy, oblivious to the changes that had been consuming my life. It wasn’t their fault, however. These days, we all have thousands of Facebook friends or LinkedIn connections; it’s just not realistic to keep up with everyone’s latest developments. But the fact that they weren’t aware of my new business meant I was losing out on referrals and potential clients. I realized I had to ensure they took notice.

Of course, you can’t just prop someone’s eyelids open, A Clockwork Orange-style, and force them to read your white papers or watch your webinars. So how do you get other people to realize, and remember, what you’re doing now — and grasp what you’re truly capable of?

[Excerpt, click on the link to read the rest of this post.]

Over the past 20 years, no group has endured greater pain and humiliation within organizations than mid-level managers (MLMs — managers from two levels below the CEO down to the line managers). Before the IT revolution, MLMs wielded genuine power within companies, acting as gatekeepers of crucial data, financials, and intelligence. Then, automation and the Web put senior executives in touch with their own front lines — and handed many MLMs their pink slips. MLMs who remained were labeled “dinosaurs” or “overhead.”

I recently conducted a study of 56 randomly selected companies involved in major change and innovation efforts in the high-tech, retail, pharmaceutical, banking, automotive, insurance, energy, non-profit, and health care industries. Nearly 68% of these large-scale change and innovative efforts failed.

I controlled for industry growth, makeup, and innovation type and used data on over 1,000 MLMs and senior executives involved in the major efforts. Then, I looked at a period of three to five years to see the direct effect of these major transformations. I examined each company’s internal documents, interviewed participants in all ranks, and analyzed market data; I also used outcome measures directly tied to the innovation/change. The result was startling: Aside from the role of the senior executives, the most important determinant of success was the role of MLMs. In the successful initiatives, MLMs served as levers of change, influencing those above and below them in the corporate hierarchy.

In the successful initiatives, MLMs were empowered in three ways. First, they were able to see how the initiatives aligned with their own personal and professional aspirations. Second, through cross-boundary and cross-functional teams, MLMs were typically the major authors of the initiatives. Finally, MLMs ensured the direct participation and authorship of individual contributors. In contrast, in the failing innovation/change initiatives, more than 60% of the MLMs’ time was spent in efforts devoted to sheer corporate survival. Focused on pleasing people rather than doing their jobs, they procrastinated on decisions for fear of failure, blamed others for mistakes and avoided taking risks. These MLMs were alienated and felt senior executives had used them as tactical tools.

[Excerpt, click on the link to read the rest of this post.]

When David Karp was 14, he was clearly a bright teenager. Quiet, somewhat reclusive, bored with his classes at the Bronx High School of Science. He spent most of his free time in his bedroom, glued to his computer.

But instead of trying to pry him away from his machine or coaxing him outside to get some fresh air, his mother, Barbara Ackerman, had another solution: she suggested that he drop out of high school to be home-schooled.

“I saw him at school all day and absorbed all night into his computer,” said Ms. Ackerman, reached by phone Monday afternoon. “It became very clear that David needed the space to live his passion. Which was computers. All things computers.”

Clearly.

Now 26 years old, Mr. Karp never finished high school or enrolled in college. Instead, he played a significant role in several technology start-ups before founding Tumblr, the popular blogging service that agreed to be sold to Yahoo for $1.1 billion this week. With an expected $250 million from the deal, Mr. Karp joins a tiny circle of 20-something entrepreneurs, hoodie-wearing characters like Facebook’s Mark Zuckerberg and Foursquare’s Dennis Crowley, who have struck it rich before turning 30.

“When I first met David he was 20 years old and wearing sneakers and jeans,” said Bijan Sabet, a general partner at Spark Capital, who was one of the first people to invest in Tumblr. “But I knew he was one of these rare entrepreneurs that grew up on the Web and who could come up with an idea, build it himself, and then ship it that night.”

[Excerpt, click on the link to read the rest of this article.]

As I am about to do an open innovation session for a B2B company, I got to think about this question once again and since it works well for a good discussion, let me start out with a couple of remarks:

• B2B companies are actually just as good as consumer goods companies on open innovation, but the latter are just more visible when it comes to open innovation initiatives. A reason for this could be that the products and brands of consumer goods companies are better known and thus we hear more about these companies.

• B2B companies have longer development cycles and thus it takes longer for them to adapt to open innovation.

• B2B companies have more engineers working on innovation relative to fast moving consumer goods companies that have a more holistic approach, which to a higher degree include other functions such as sales, marketing and supply-chain in their innovation efforts. This could lead to a stronger focus on traditional, internal focus for B2B companies.

Personally, I lean towards the view that many B2B companies are slower (compared to B2C) adaptors and that they have an untapped potential on open innovation. The good thing is that many B2B companies have realized the value in this potential and thus there are lots of interesting initiatives going on. We just don’t hear too much about this.

Not so long ago, I also wrote a blog post on the differences and similarities on open innovation between B2B and B2C companies. Here they are…

[Excerpt, click on the link to read the rest of this post.]

The pervasive lack of enthusiasm or even awareness of time in regards to innovation is a constant source of amazement for me. In organizations transfixed by time, speed and efficiency, innovation and product development are often the slowest out of the gate, the longest efforts to accomplish and seem completely unrelated to the real world.

In any organization, people are constantly asking – can we do this faster? Can we respond to customers more quickly, can we collect cash more quickly. The only things most businesses want to do more slowly these days is pay bills. Yet innovation seems to be in a time warp, slower by far than other important activities and processes. There are, of course, reasons why innovation is slow:

1. Innovation is uncertain and risky, so organizations try to move slowly to reduce risk
2. Innovation (if done well) is often ahead of the market, so organizations try to time innovation to market needs and demands
3. Innovation requires tools and techniques that are unfamiliar, which slows the process
4. Innovation and subsequent product development processes are sclerotic, like blood vessels full of plaque, stuffed with unimportant but time consuming activities.

My stipulation is that you should do innovation as fast as humanly possible, even at the risk of skipping steps or bypassing checkpoints, because your internal clockspeed is almost certainly out of synch with the market’s clockspeed.

[Excerpt, click on the link to read the rest of this post.]