So severe is this threat that some scientists even believe that the human race is rapidly becoming the architect of its own downfall. It’s hardly a surprising conclusion when considered in the light of an estimate that between 30% and 50% of all species could be heading towards extinction by the middle of this century.
What in essence are we talking about here? Well those scientists who were issuing the mass extinction warning were focusing on plants, animals, insects and marine creatures which make up the ecological balance of the globe. However, they could have equally been talking about the businesses upon which our lives and livelihoods depend. As species disappear; as the sources of our food and our fuels, our clothing and the other trappings of our daily lives vanish from existence not only will we have to adapt but so too will the businesses which depend on these items for their very existence.
But there is another threat facing business and it is one which is every bit as pressing and as real as the extinction of our flora and fauna. The pace of technological change allied to the fallout from the global recession is shaking up businesses in a way which has not been seen since the Industrial Revolution. Put quite simply, businesses which carry on trying to tread the same pathway which stood them in good stead in the past are sleepwalking into extinction.
Tomorrow’s main rival may not even have set up in business today.
In a world in which an individual sitting in their kitchen has the potential to access the same level of technology as a multinational corporation; in a world in which those who traditionally served a local community now see the entire globe as their marketplace; in a world such as this, business disruptors can come from anywhere and tomorrow’s main rival may not even have set up in business today.
The challenge therefore for business leaders is to adopt a strategy which will set their business at the forefront of change; future proofing so that instead of being overwhelmed by a world which is adapting at an exponential pace, they will be instrumental in creating the future. We call these businesses Next Generation Organizations and the strategy which they adopt is quite simply one of innovation.
So what does it mean to be a Next Generation Organization? What differentiates these businesses from those which operate under a standard business model which has stood organizations in good stead for generations? The answer is that Next Generation Organizations have embraced an innovation culture which sets intelligence, collaboration and adaptability at the heart of the business model.
Intelligence, collaboration and adaptability at the heart of the business model.
Why intelligence? Because although businesses have quantities of data about their customers, they rarely understand them. You may note that your customer buys toothpaste once a month but do you know how and where that toothpaste is used, what concerns your customer has about their health, what other products they use and how toothpaste fits into their lifestyle? Unless you truly seek to understand your customer you will never be able to design products which meet their lifestyle needs.
Why adaptability? Because given the pace of change, and the way in which products are increasingly feeding off each other, second guessing the marketplace is becoming an increasingly complex affair. If you don’t know where the world is going, how do you plan? Yes, having greater intelligence will help but organizations which are agile and adaptable will be far better placed not only to meet the future needs of consumers but also to create the future needs of consumers.
Why collaboration? Because organizations can no longer afford to operate in isolation. The recession saw the growth of organizational interdependencies as businesses outsourced their HR, marketing or IT functions to specialist companies. But collaborating with third parties is only the tip of a collaborative iceberg which will draw suppliers, third parties, research departments, universities and even customers into the mix. There really is no option. After all, what better way to truly understand customers than to collaborate with them on designing new, adaptive and more importantly, relevant products, services and experiences?
Taken together, intelligence, collaboration and adaptability forms the heart of a culture of innovation which will create game changing differentiation for organizations. But make no mistake, innovation cannot be seen as a bolt on to an existing organization model. It requires a complete change of mindset from silo’d hierarchy to open collaboration and from a process driven model to one which is driven to create solutions. Click here for a free white paper, which provides a deeper dive into Building a Next Generation Organization.
That doesn’t mean that innovation has to sit in isolation, however. There are other business models which will coexist with and augment the innovation imperative. For example, there is a growing appreciation of the idea of the circular economy. One of the key proponents of this model is Dame Ellen MacArthur who was inspired to explore the challenges of working with finite resources thanks to her pioneering around the world yachting experiences.
Moving away from a ‘take, make, dispose’ model.
The circular economy seeks to move away from a ‘take, make, dispose’ model and towards one which is restorative by design, thereby keeping products, components and materials at their highest utility and value, at all times. The model looks to design out waste, to build resilience through diversity and to think anew about systems and processes. The circular economy model fits well with cultures of innovation as it looks to transform the business landscape from product design, service and business models to the consumption of resources.
Whether businesses adopt a pure innovation culture methodology or ally innovation with other ideas such as the circular economy is a matter for the leadership. However, failure to move towards a Next Generation Organization methodology will be a matter for employees, for customers and for others who rely on the organization as it quite simply will not be there to support them in the future. The last few years has seen the demise of household names, of global brands simply because the leadership failed to anticipate the changing marketplace. But we predict that these are only the forerunners of a much larger extinction pattern as new entrants to the marketplace overwhelm and disrupt those who have failed to understand the importance of intelligence, collaboration and adaptability in an open and ever-changing technological environment.
By Cris Beswick
Originally trained as a product & industrial designer, Cris Beswick spent over a decade as a successful entrepreneur & CEO building an award-winning design group. After structuring a full exit in 2008 he founded The Future Shapers, a boutique innovation consultancy specialising in working with CEOs and senior teams on the strategy, leadership and culture required for innovation. As such Cris has coached, advised and delivered keynotes to some of the worlds most successful companies on how to become exceptional by building game-changing innovation capability and embedding it into organisational culture.
Cris has also delivered executive education programmes on innovation for leading UK and international business schools such as Henley Business School, Cranfield University’s Centre for Competitive Creative Design and Synergy Business School in Dubai to name but a few.
Cris is the author of the book ‘The Road to Innovation’ and his next book ‘Building a Culture of Innovation’ will be published in late 2015. As well as authoring numerous white papers Cris has also contributed to articles for The Times, Financial Times and The Sunday Telegraph to name but a few.
Photo: Miniature People with dinosaur by Shutterstock.com