Organisations have always needed to earn the right to exist in the market. However, as both market predictability and the barrier to entry is decreasing, we are now seeing that incumbents no longer enjoy the same commercial advantage as they used to. It is agile organisations, those that frequently inspect, adapt and pivot to meet opportunities, that are more likely to flourish in this ambiguous and uncertain market. Speed and effectiveness of this adaption to competitors, disruptors and new customer demands are key measures of Market Agility.
Be careful to fall into the trap of superficial innovation though. Being innovative means taking risks. It means accepting, and being ready for failure. It means second guessing your own customers in some instances. Kodak is probably the poster child for doing, but not being, innovative. They invented the digital camera but did not feel the market was ready and were not willing to take the risk of hurting their print partners and so did nothing. Now there is a digital camera everywhere, and most of them aren’t Kodak's.
A side note: Innovation doesn’t necessarily mean doing something brand new. It can be doing something old in a new way or with a new market. But, by definition, it is a risk. Apple took the Xerox Parc prototype GUI interface and put it successfully inside an innovative personal computer. Google took the idea of a social network and created an unsuccessful product called Google+. Both these companies didn’t invent the idea. They tried it, either successfully or unsuccessfully, in a new way.
Some of the key characteristics of market agility include;
- Rewarding ideas, especially if they fail.
- Define KPIs around the result of an experiment (not just success).
- Finance and procurement processes support ambiguity and uncertainty in market innovation before investing.
- Short feedback loops to determine the real market reality of the idea
- Teams need to be able to talk directly, and frankly, to users/clients about their experiences
However, market agility isn’t just innovation and adapting to meet changing customer demands - it must include the connection to the market in the wider systemic perspective of business agility. The view of the product lifecycle extends to include the entire value chain - from your suppliers upstream to your distributors downstream. The partnerships that this systemic perspective grants enables the creation of superior offerings that delight your customers. Methods and frameworks like Lean Startup, Lean Enterprise, and Design Thinking as well as many of the traditional agile practices fall under this domain.
Creating Innovation[edit | edit source]
Building a culture of innovation is hard. It has to be embedded throughout your entire organisation. Something that many organisations struggle with. One example if the Kickbox from Adobe. On the surface, this is a great idea. Anyone can request the box: inside is all the information needed on how to turn an idea into an experiment, a Starbucks gift card, and (the brilliant part) a $1,000 credit card to spend on anything you like. But here’s the problem, Adobe is effectively saying that their internal procurement processes are so counterproductive to innovation that they need to bypass them entirely. Kudos to them for recognising the problem and coming up with a workaround, but for the organisation to truly “be” innovative, it has to go deeper.
Case Studies[edit source]
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