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Three Modes of Innovation: A New Strategic Framework

Every client assumes they have to disrupt or be disrupted, but that is often the wrong innovation recipe for them. Disrupting their culture at times of growth may be the worst advice you could offer.

You cannot give such general advice, such as Disrupt or Die. That is silly. The world of commerce is not that simple. It may be the wrong time in the organization's lifecycle to consider such a focus. Maybe they already lead their category, but there is amply headroom to grow with new projects, new technologies, new approaches to packaging, languages, and marketing.

The primary time a category needs disruption is if it is owned, in spirit, by a single channel that dictates terms, price barriers, and sometimes wants a hand in designing the product.

Instead of a mandate to disrupt always, I advise clients to consider three modes. They should able to name their primary mode as their defaults for how projects get launched and see their second mode as a plan for molting out of the primary mode.

Here are the three modes: Order, Disorder, Reorder 

Many organizations focus just on the first mode. They optimize all of their processes to value engineer the most efficient order.

This route of standardizing an organization after its initial success—to look at the organization as an algorithm that can be systemized and made more profitable at scale—remains the basis of the good management principles since the Industrial Revolution. This mode works as long as you are in a static segment in a category that is somewhat fixed, even regulated. Here focusing on product innovation is sufficient.

Too much management, too much of an obsessive focus on Order and you develop blind spots where you get flanked by competitors both known and unknown.

To regain a leadership position you have to disorder, change the game and change your own culture and processes. This is a tough internal order, real change management. Innovation tools help you make sense of disorder and to emerge from the process with a new vision and a new roadmap for winning. This is the necessary journey, a shift to meaning. To grow this way there you have to give up relying on what used to serve you well. As the ancient Shamans would say you have to be dismembers and then put back together anew. This is the messy work of transformation, not product, but strategy and business model innovation.

There is no direct flight to reorder; you have to go through disorder. Reorder is when an organization that had gotten stuck begins thriving in new and unexpected ways. Think of Microsoft in 2016-2017 as an organization that has been reordered. Such entities acquire a growth mindset; they have reinvented themselves and innovated their culture and their offering in the world.

About the Author: Michael Graber is the managing partner of the Southern Growth Studio, an insight, innovation, and strategy firm based in Memphis, TN, and the author of Going Electric. Visit www.southerngrowthstudio.com

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