I talked in my first post about how emerging markets are changing innovation, and two publications this week focus attention on the same topic. The title of the latest edition of The Economist is “The new masters of management” and contains a 14 page special report on innovation in emerging markets. It points out that not only are companies from the developed world focusing increasingly on emerging markets for innovation, but also emerging market firms (eg Haier and Huawei from China) are moving in the other direction! They also talk about reverse innovation in terms of “frugal”, referencing the Tata Nano, the business model of Bharti Airtel and BYD’s ambition as not only a global supplier of batteries, but to be a global car company. Many of these innovations are not just about new products, but involve completely new business models.
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“Do I contradict myself? Very well then, I contradict myself. I am large, I contain multitudes.” – Walt Whitman
In Obliquity, John Kay provides an elegant and clear explanation of why goals are more likely to be achieved when pursued obliquely rather than head on. He provides great examples of how the most profitable businesses are not run for profit, the most successful careers do not pursue success and many other cases where iterative or adaptive approaches lead to greater success than more direct ones, with the ability to cope with the complexities of a changing world and human social networks.
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“Nature herself makes the wise man rich.” Cicero
“We still do not know one-thousandth of one percent of what nature has revealed to us.” Albert Einstein
I had a wonderful break in Japan recently, and spent most time exploring Kyoto’s beautiful gardens and charming back streets (as well as a good quota of temples of course). There are many scenic gardens in the city – public and private, small and large – all beautifully designed and maintained. They are a perfect place for contemplation, which was often their original function. Indeed one of the more beautiful paths along the canal is called the “Philosopher’s Walk” and must be stunning in the full force of the April blossoms (I was a little early for this).
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“Perfection is achieved not when there is nothing more to add, but when there is nothing left to take away.” – Antoine de Saint-Exupéry
In a very elegantly written book,, Matthew E. May argues that less is more in all aspects of life. In The Pursuit of Elegance, he develops four key themes, which lead to more elegant solutions to all kinds of problems: symmetry, seduction, subtraction and sustainability.
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“You only find out who is swimming naked when the tide goes out.” – Warren Buffet
London continues to be a great world city, leading others in terms of both it’s cultural vibrancy and as a linchpin of the world’s financial services. Both of these are reflected in current theatre listings and I was fortunate to catch both “The Power of Yes” by David Hare and “Enron” by Lucy Prebble. Both plays offered fascinating insights into the financial crisis, which also resonate in research and innovation,.
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A great way to start this learning log is to discuss how innovation practice is being disrupted by the emergence of new markets in Asia and other developing regions of the world. Truly disruptive innovation has always been based on finding new uses and new markets for new products rather than developing better and better delivery of existing products to existing customers (read Clayton Christensen for a detailed introduction to disruptive innovation). As emerging markets develop, they present huge new markets for products, but with consumers whose needs can be very different from those in existing developed markets. That is, they present a huge opportunity for disruptive innovation.
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“It is not necessary to change. Survival is not mandatory.” – W Edwards Deming
