So how do you manage exploiting and exploring for Innovation?

Innovation Exploit and Explore to TransformSo how do businesses organise their structures to be able to simultaneously manage the needs to exploit and explore innovation?

In this post I wanted to explain my thinking through on this ability to be ‘ambidextrous’, knowing the difference of when to exploit and when to explore as essential to leveraging innovation, in all its forms and watching out for some of the traps in not managing this well.

Managing this, in all honesty, though, is hard to get the balance right but highly valuable if you do achieve it, it can transform the business. Many of our organisations struggle to manage both successfully as they tend to focus more on separation mostly in organisational structures alone as their attempt to become ambidextrous. It is far more than ‘just’ this.  Get the balance right across the organisation’s design and in its leadership management, it becomes a very powerful mechanism for accelerating performances by delivering significantly new innovation and equally sustaining and leveraging the core business you have today.

Recently I contributed a blog post over on the Hype Innovation Blog ” Balancing Exploitation & Exploration for Changing Performance” that opens up the subject but then extensively dives into three examples of Apple, GE and Google that are working in highly ambidextrous ways, pursuing exploiting and exploring in their own unique ways.

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Uncharted Waters Disrupting the Corporate Boardrooms

The storm clouds of Radical InnovationWhen you read a report that has within its executive summary this: “In combination the boards stand unarmed to enter the battlefield of future business creation in a disrupted world it makes you want to read on.

In a recent report called Radical Innovation and Growth: Global Board Survey 2016 (link opens the pdf) we have results from a survey jointly conducted by Deloitte Denmark and Board Network – The Danish Professional Directors Association, that opens up much that can concern us about the current boardroom and its great difficulty with managing more radical innovation.

It seems within our boardrooms they are ill-equipped to managing in today’s world, grappling with the past, holding on, perhaps too tightly, to the present and certainly being unsure of the future. It is struggling to adjust to all that is entering their world.

In this report, they surveyed 614 global board professionals from a total of 50 countries during the period covered from November 2015 through to February 2016 and then published in February 2016.

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Caught in the Headlights of Disruptive Innovation.

Exploding DsruptionThis past weekend I had an extended period of re-reading about the effects of disruption that seems to be occurring across all points of business, our politics, our governments, it seems across our lives.

I had been looking forward to a nice break up in the mountains of Switzerland, in a place near St.Moritz for five days of some walking, catching up with good friends over some great meals.

The evenings playing different card games or board games, as the temperatures dropped outside to minus six centigrade, the competitive nature raised the inside temperatures significantly. All good plans sometime get disrupted.

Regretfully a few days before, I ‘pulled’ some ligaments around the knee and this rendered the walking to some pretty tame stuff but the company, food and drink seemed to compensated a little I must admit, it eased the pain.

So I had some time on my hands so I decided to go back over the whole area of disruption to get a broader understanding and how this is driving so much within our innovation activity at present.

Disruption is all around us, coming at ever-faster speeds Continue reading

Striving for the innovation balance: between exploring and exploiting.

Exploit and ExploreWe never seem capable of adapting as well as we should do. Adapting always seems a work-in-progress, or it is often something where we are simply making little or no progress!

We often stay ‘stuck’ in the way we do ‘things’ around here, never seemingly able to break out into something new or different.

To adapt we need to open ourselves up to learning and adjusting our organizational ‘form’ in new ways.

In business there should be a constant battle to reconfigure the assets and extend the existing capabilities. Yet often these stay ‘static’ not learning or improving.  In our innovation activities there is an even greater pressing need to build into our thinking the ability to find more dynamic capabilities. It is a constant innovator’s dilemma to think through and get right.

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Building the new dynamics into our capacity to innovate

Exploit and ExploreDo we know what are the dependencies and requirements for building and sustaining your organizations innovation success? How do you sustain innovation, is it more through the structuring of everyday work, by creating a particular set of social rules and resources that foster specific routines? Or something different?

We work really hard at maintaining these re-occurring processes, never willing to extend and push them in different and new ways. We have actually become very static in our approaches and learning, we are not learning anew. We often simply end up with incremental innovation that might just ‘nudge’ the growth needle but does little more than sustain us in the present and can be ‘contained’ in a tidy process that makes many, including the ‘bean counters,’ very happy until someone changes the game.

Then we need to think differently but this is usually far too late.. As demand is more volatile today we need to experiment, explore, learn and adjust. What becomes more important is the ‘work to be done, and how we go about tackling this and not the work done’ where we often simply ‘default too. Surprisingly Adam Smith identified this important difference in work way back in 1776.

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We are transcending traditional industry and product boundaries

Global connectionsIt seems this is the era of the digitally savvy entrepreneur. With the dizzy array of choices, combined with technology prowess and ‘plugging’ these into ‘seen’ customer needs, they are setting about disrupting existing businesses and establishing new ones, on an ever-increasing global scale.

So what and how is the incumbent meant to react if it is an existing market? What should they do when they realize the traditional markets where they have safely operated for years has suddenly been overtaken by a new market creation, one that has gone outside old borders in industry and product.

Markets that are in the hands of the technically savvy entrepreneur are to be sliced, diced and recombined, are providing totally disruptive approaches to existing business models. If they get the factors right, hit the needs of customers in their design, understanding, agility in responding to learning and adapting, ability to be fast to market and capable of scaling up really fast, then they transform spaces, leaving the established players desperately struggling to find answers and catch up.

The whole world of business is changing radically.

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Seeking fresh winds and new directions

the_winds_of_changeAnyone who has felt the ‘full force of the wind’ will know the feeling of how hard it is to keep on your feet, to stay determined to stay upright and true, to hold the course, whatever happens.

When you feel the force of change running through the organization, you tend to have that same sensation, to resist the force with all your energy.

It is often really hard to let go, the environment was something you had become used to, you accepted and become resigned to its weaknesses and constantly exploited its possibilities or even possibly the other way round.

Ignoring the power of choice within change is dangerous

Constructing a climate for any transformation is hard. Our cultures are deep-rooted; we resist those winds blowing into us “full on,” well beyond being reasonable or smart enough to avoid them before they confront us. The Chinese proverb below gives us a clear choice: “to build walls or build windmills”

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