Differentiation should be a prime motivator of any strategy; firms should always look to find an edge. But too often CEOs find themselves stuck in what I call an innovation plateau. They fall into chronic sameness, an inertia driven by a feeling that they must focus on cost, even cheapness, to remain competitive.
4 Things Your Innovation Efforts Shouldn’t Focus On
Too often companies fall into chronic sameness — an innovation plateau driven by a feeling that they must focus on cost, even cheapness, to remain competitive. Several symptoms of this inertia are born of good intentions: obsession with cost-reduction, obsession with listening to the customer at the expense of offering something new, obsession with incrementalism and obsession with acquisitions. In the long run, only investment in deep science — the R in R&D — can help continuously avoid or break through innovation plateaus. Deepening the science behind the business, focusing on discovering higher-value market segments through new products and in new industries and looking to expand globally will all keep the top line growing. For example, the small dairy cooperatives Tatua and Westland in New Zealand developed specialized ancillary products such as complex lipids and the world’s first goat milk with a long shelf life. Rather than trying to make the cheapest steel in the world, the Basques (Basque Country in Spain) make the steel for spacecraft.