The 8 Most Critical Capabilities for Innovation

What did a first class researcher write about organizational values for agility? Are there eight critical capabilities necessary for innovation? What is the difference between strategic and business model innovation? Welcome to have a look at the review of December's online discussions.
Marcus’ favorite post this week for actionable knowledge and inspiration is Five cultural values shared by agile organizations

This month, a new innovation blog entered my reader: Marc Sniukas offered three actionable posts on innovation and business models. First out is a slide deck on innovation types. It should be viewed as one of many tools necessary to bring order to the multitude of innovation concepts currently used. He also offers a link and a summary of BCG’s latest innovation report, listing the eight most critical capabilities for innovation. Finally, he offers an explanation of the difference between strategic innovation and business model innovation – something which is no doubt easily confused. (Although Marc Sniukas is not an authority, his definitions are clearly in line with Osterwalder’s (2004) thesis and Osterwalder’s work is well diffused in industry at this point.)

The eight most critical capabilities for innovation

Over at London Business School, professor Don Sull has decided to provide a series of blog posts on the agile organization. The most actionable of the posts is most likely this one, which describes the five most important cultural values that promote innovation, in Sull’s (considerable) experience.

There were some reoccurring themes among the strategy blogs during December. The first was the topic of vertical integration. Quite fitting in terms of timing, since Oliver Williamson celebrated his Nobel prize “for his analysis of [...] the boundaries of the firm” this month.

I would recommend one blog post in particular to a busy innovation manager considering decisions of business model nature

The theme seems to have started with this piece (requires subscription) in the Wall street journal. Some strategy blogs quickly picked up the theme. I would recommend one blog post in particular to a busy innovation manager considering decisions of business model nature: renowned researcher Rita McGrath explains why vertical integration makes sense when renewing an industry.

Why vertical integration makes sense when renewing an industry

A second theme that showed up in several places, is based on a free e-book: What matters now. It’s actually an amazing venture: Seth Godin, author and serial entrepreneur, has managed to get 70 notable ‘big thinkers’ (e.g. Chris Anderson, Tim O’Reilly) to write one page each about something important that matters right now. He then compiled these into a book, which he gives away for free (pdf). I recommend the easy yet profound read to anyone looking for new inspiration for 2010.

Meanwhile, Mark Perry offers a number of inspirational photos with examples of “jugaad“, an Hindi term describing entrepreneurial creativity to compensate for scarce financial resources. While perhaps not directly applicable to an innovation manager’s situation in a well established corporation, the story and the pictures certainly makes for a good internal presentation in response to recently tightened budget constraints.

Anthony Tjan, a US venture capitalist, recommends a simple yet useful litmus test of the likely impact a new business is having on invested capital.

Intent on continuing sharing bite sized chunks of inspiration, Anders Sundelin at The business model database-blog stays true to the name of the blog. He offers 10 brief and to the point examples of real firms with different yet highly successful business models including e.g. Lego, Amazon and Threadless.

Your comments are welcome!

Do you have any comments on the links presented here? Are some of them broken or not accessible from your network? Would you like more focus on peer-reviewed journals or more focus on pure blogs? Do you know of a blog post that you would like to see here next time? Feel free to send an email to [email protected].

About Marcus Linder

Marcus LinderMarcus Linder researches environmental innovation among industrial firms at Chalmers University of Technology. Focus areas include strategic rationale and the practical how-to of including environmental aspects in the innovation process. An important starting point is that profitable environmental innovation often require more than just “quick-fixing” a firm’s existing offers. Theoretically, Marcus is grounded in the problem-solving perspective on management, a subset of the knowledge-based view of the firm. In terms of applied innovation management, his main passion lies in business model design. He is currently employed as a PhD student at Center for Business Innovation at Chalmers University of Technology. Before starting his PhD studies, Marcus successfully performed a business innovation project at CBI culminating in a new product concept now planned for market introduction by Göteborg Energi.