Av Christian Rangen
Founder, CEO at Engage // Innovate & Strategy Tools – the Modern Strategist’s Toolkit
Investorkapital, business angels & corporate venture avdelinger; stadig flere klynger begynner arbeidet med kapital. Men hvordan skal egentlig en klynge gå frem for å utvikle sin kapitalstrategi?
De siste fire årene har vi jobbet tett med klynger, klyngeledere og nasjonale klyngeprogram. De fleste av disse er solid forankret i Triple Helix logikken; bedrifter i nettverk må kobles mot forskningsdreven innovasjon, støttet av offentlige myndigheter. Dette var den opprinnelige ideen bak Triple Helix på tidlig 1990-tallet.
Men, verden forandres.
Stadig raskere global innovasjon, flere digitale forretningsmodeller og et stort antall velfinansierte vekstbedrifter gjør nå at både bedrifter og klynger beveger seg bort fra Triple Helix til fem-punkt, eller Pentagon modellen. Plutselig sitter klynger med entreprenørskap, akseleratorer, børs-noteringer og privat kapital på kartet. Hos stadig flere klynger dukker nå spørsmålet opp, hva gjør vi med kapital?
Det siste året har vi jobbet tett med flere klynger for å besvare nettopp dette spørsmålet. Hva bør være klyngens kapitalstrategi?
Fra Solklyngen i øst til havklyngene i vest, fra reiseliv til internasjonale drone, mobilitet og fintech klynger har vi nå gjort erfaringer, observasjoner og sett klyngenes kapitalstrategi utvikle seg i praksis.
Vi har nå samlet disse erfaringene i ti punkter for klyngens kapitalstrategi. Vi tror disse er like anvendbare i Bilbao og Bergen, eller Zagreb og Sandefjord. Hver innovasjonsklynge, stor eller liten, må finne sin kapitalstrategi, men her er våre ti punkter.
Velg en ansvarlig for kapitalområdet i styret. Dette kan gjerne være en kapitalaktør (investor, fond) som velges inn med det mandatet.
Uten forankring og kompetanse på plass i styret kan man nesten bare la være å starte arbeidet i organisasjonen.
Vår observasjon er veldig få klynger har definert kapital som et eget område for styret og få av styrets medlemmer er kjent med at dette er viktig for klyngens utvikling.
Daglig Leder har et overordnet ansvar for utvikling og implementeringav kapitalstrategi, men er ikke pålagt å ha inngående teknisk kunnskap.
Daglig leder må derimot ha god kjennskap til medlemmenes behov og ønsker knyttet til kapital.
I flere av klyngene vi har jobbet med, har Daglig leder ikke vært i forklare relevans, behov eller betydning for klyngens medlemmer (Se også punkt 5)
3. Investor Relations Manager
Utvikle rollen «Investor Relations Manager» (IRM). Dette kan være en deltid (%) eller fulltidsstilling. IRM må ha hands-on erfaring med tidlig-fase investeringer, venture fond og vekstkapital. Dette betyr blant annet at en tradisjonell bankleder neppe er riktig profil.
Ideelt er dette en person med flere års erfaringer med tidlig-fase investeringer, bredt kjennskap til investorlandskapet i sin del av verden (Europa, Sør-Øst Asia, Latin-Amerika) og selv deltatt i etablering og drift av venture fond.
Litt for ofte ser vi rollen som IRM fylles av personer med ingen faglige kvalifikasjoner eller relevant erfaring. Da blir også resultatet deretter.
Utvikle en dedikert Innovasjonsgruppe på kapital-området. Denne ledes av IRM, men består av gründere, investorer, venture fond, business angels og etablerte bedrifter.
Innovasjonsgruppen kan være aktiv i de neste punktene.
Kartlegg dagens kapitaløkosystem for klyngen, enten det gjelder digital helse, Havbruk eller Fintech. Det vil være ulike investorer som dukker opp med ulike mandat og investeringsområder. Sørg for å forstå ikke bare hvem de er, men også deres investeringsmandat, historiske track record og aktive portefølje.
Start med lokale investorer, men kartlegg ut av egen region og eget land. Det er åpenbare investorer som kan kobles på fra land som Tyskland, Japan og USA.
6. Kartlegg kapitalbehov i klyngen
Kartlegg medlemmene i klyngen, i forhold til deres modenhet og kapitalbehov.
Kartlegging bør avdekke hvor stort kapitalbehovet hos medlemmene er, samlet sett, over en periode på 18 – 24 måneder.
Bruk gjerne Klyngens Medlemmer til å bistå denne kartleggingen.
Erfaringer fra slike kartlegginger er meget positive.
I de tre siste gjennomføringene vi har deltatt i, har det blitt avdekket et kapitalbehov blant klyngens medlemmer på mange hundre millioner kroner; et behov som var nærmest ukjent for klyngeledelsen.
7. Utvikle en Kapitalstrategi
Når informasjonsgrunnlaget er på plass (punkt 5 og 6), jobb med flere stakeholdere (Styret, Innovasjonsgruppen) for å utvikle en konkret og målbar Kapitalstrategi.
Denne bør inneholde et langsiktig målbilde og konkrete steg på veien med KPI’er på år 1, år 3, år 5 og år 10.
Bruk gjerne Klyngens Kapitalstrategi som et utgangspunkt.
8. Kompetanseløft (felles)
Lanser kompetanseprogram for alle medlemmene i klyngen, samt viktige samarbeidspartnere.
Et slikt kompetanseprogram kan gjerne strekke seg over ulike nivå og mot ulike målgrupper. Et forslag kan være:
- Grunnleggende Kompetanse for kapital i klynger (1/2 dag)
- Investorkapital i klynger (2 dager)
- Engelinvestor i klyngen (1 + 1 + 1 dager)
- Startups: Investor Readiness Level? (1+1+1+1 dager)
- Corporate Venture Capital (2 dager)
Disse kan kjøres lokalt, med få eller mange deltakere.
For «Advanced users», vil vi kanskje anbefale
- VC unlocked (fem dagers kurs, USA, Asia)
- Executive Venture Capital (fem dagers kurs, USA)
9. Start med de store bedriftenes behov
Dette er ikke et åpenbart punkt for mange klynger, men vi tror det kan være et helt sentralt suksesskriterie.
Ved å kartlegge de store bedriftene, klyngens medlemmers, behov, kan klyngen identifisere strategiske investeringsområder (investments areas) og deretter utvikle særskilte investeringsprogram rundt disse.
Dette arbeidet, med å utvikle klyngens portefølje av oppstartsbedrifter, er forbeholdt veletablerte klynger, da det krever både innsikt, kompetanse og ressurser. For de klyngene som har kommet skikkelig i gang, ser vi allerede et veldig godt resultat av arbeidet.
10. Aktivitetsplan (felles)
Etabler en 18 måneders handling- og aktivitetsplan.
Velg ut noen få områder. Prioriter bort de andre.
Tenk partnerskap, samarbeid og utvikling sammen med andre.
Inngå partnerskap med internasjonale akseleratorer, utvikle program sammen med andre klynger og ikke minst, lytt til hva investorene i klyngen din ønsker seg.
Evaluer og juster underveis.
Først og fremst; Quick Wins
For klynger og kapital er det mye som skal løftes. For de fleste er dette et helt nytt område. Begynn med små seire. Sikt inn på noen raske suksesshistorier. Det er bedre å bidra til 1 million til ett selskap nå, fremfor 100 million om 15 måneder. Jobb frem et lite antall startups og scale-ups som er investment ready. Hjelp dem bygge investor syndikat (grupper), og dra emisjonen i havn.
For både fremvoksende, vekst- og superklynger vil kapital være en viktig del av strategiarbeidet fremover. Spørsmålet er bare hvor og hvordan man ønsker å starte.
Strategiverktøyene i denne artikkelen kan lastes ned på norsk – gratis – på www.strategytools.io.
The role of the strategy officer is rapidly evolving. Expectations are rising, yet changing industry landscapes, emerging disruptors and well-funded startups with aggressive business models puts significant pressure on the role. It is vital for companies to understand the four different roles for the Strategy Officer. Does your company?
In our work with hundreds of companies and dozens of strategy officers, we have come to identify four significant roles for the strategy officer. We believe it is critical for companies to understand how their specific strategy function works and how they can improve it in the face of emerging competition and significant change.
The Four Roles Explained
The Influencer succeeds by creating internal momentum for strategy. This might include sparking key conversations, framing new strategic questions, instilling a sense of urgency, of curiosity within all levels of management ranks.
He acts as a coach, a facilitator and networker internally. Strategy workshops might have very experimental formats, few slides and never have any answered prepared in advance to be presented. He cares deeply about creating shared understanding across complex issues, often simplifying the complex into easy-to-grasp key issues.
The influencer is a master of conversations.
Fred, a long-time client of ours, often prepared his management strategy workshops by asking three advance questions, often framing the questions in a highly challenging context. “What would happen if our market fell by 45% in 90 days?”, or “What if Russia shuts us out?”. While strongly divergent from daily operational issues, the reframing of potential strategic issues, helped expand the thinking and open for radical threats, scenarios and, eventually, strategic moves by the company’s legacy business units.
BIG SYSTEMS THINKER
The Big Systems Thinker has her focus far outside the home organization. She lives by strong external orientation. She spends 80% of her time on external partnerships, alliances, mapping out M&A prospects and closing deals. She has strong relationships with key stakeholders across the landscape, sensing changes and disruptive trends long before they fully develop.
She excels at sensing potential industry scenarios 20-30 years ahead. Mapping industry shifts and strategic inflection points are just a normal part of her job, giving rise to her role as a complex, Big Systems Thinker. She works closely with emerging startups, VCs and technology investors to have a first row seat to the next generation of companies to watch.
The Big Systems Thinker is a master at sensing the future.
A European media company brought in a former VC and technology founder to help develop an aggressive growth strategy. His network and access to emerging startups on the US west coast, was a large part of why he was hired. Starting in the role, it became apparent his thinking was just too far ahead from the main engine and current focus of the company, eventually leading to his departure in less than 15 months.
The Analyst is the brainy, educated, numbers person. He is driven by getting tangible facts, allowing for conclusions and clear recommendations. The analyst writes complete business cases to be presented in complex and lengthy slide decks. He might be oblivious to social influence and stakeholder management as a long as he’s getting his analysis right.
If leading the strategy process itself, the analyst’s focus is getting all the facts into organized slides. The analyst is also likely to hold the role of Balanced Scorecard Manager, having a highly numbers- and metrics-driven approach to strategy execution.
The analyst is a master of getting the current facts and numbers right.
We frequently encounter Analysts, tasked with writing the perfect business case for the top management’s consideration. Basic concepts like customer discovery, business model testing and lean startup principles are understood by the people we meet, but far removed from how they work. Often, they experience months of analysis and a strong recommendation, only to be shot down by management. It is frustrating in many organizations to see the effort going into the “strategy as analysis”, while an evolving, involving, learning approach would be far more effective.
The Scout is responsible for early outside development of new ideas and new networks. Attending conferences and events outside his own industry domain, he gets a peek at upcoming developments across many areas and disciplines. He is likely an avid reader of multiple sources and books. He would be comfortable hanging out at Uber Elevate Summit, Uber’s annual summit for their flying car project, without it having any significant relevance to his company’s day-to-day strategy.
The Scout is adept at scouting future trends and emerging customer behaviors. He early identified the sharing economy and Blockchain as key trends with massive potential.
The Scout might see the future, but he struggles to create internal interest and support. He has limited or zero mandate, funding and execution capability. The Scout suffers from limited impact, over time creating frustration and departure from the organization.
The Scout is a master of seeing early trends but struggles to convert into internal action.
HOW THEY WORK
Their roles are usually very different, as are their working methods.
The Scout will often be working alone or in a very small team, allowing little ability to engage and activate the organization.
The Analyst usually has a team around him, often with more analysts. Combined, they have some reach, but in reality, limited ability to influence and engage with organization.
The Big System Thinker often has a larger team under her, while she personally is both visible and highly influential within the company. Often, she carries a strong vision for the future of the company, balancing the need to serve the CEO vs. becoming the thought leader herself.
Finally, the Influencer uses his network for maximum effect. He might build and operate formal, active strategy networks internally, creating strong reach across the strategy discipline. Equally important is his informal, invisible networks at all levels of the company. He might not push his vision for the company, but through his strategic questions and re-framing of key issues, he actively helps shape the future.
PICKING THE RIGHT TOOL FOR THE JOB
In our work with Strategy Officers and their strategy teams across multiple industries, we are often perplexed by the lack of tools they have at their disposal or they choose to use. Through our seven-year R&D project, Strategy Tools.io, we have developed an open source suite of 15+ strategy & innovation tools. A large part of our work has been understanding the context, need and developing the right tool for the job. What we have seen, first-hand, is the effect of having the right Strategy Tools for the job.
INFLUENCER: STRATEGIC INNOVATION CANVAS
The Strategic Innovation Canvas can be applied in multiple ways. First and foremost, it is a great conversation starter on the overall strategic priorities of the firm. Built around the classic Three Horizons, the canvas forces a strategic discussion on short-term vs. long-term thinking.
With a good facilitator, the canvas frequently kick-starts a wide strategy review, opening mindsets and perspectives to a much welcome, more expansive strategy thinking for all participants.
DOWNLOAD YOUR STRATEGIC INNOVATION CANVAS
BIG SYSTEMS THINKER: INDUSTRY SHIFTS MAP
The Industry Shifts Map lets groups and individuals map out and better understand industry-level changes and the company’s ability to successfully respond. Columbia Professor Rita McGrath emphasizes the importance of grasping industry level strategic inflection points, something we likely to see at an accelerated pace in the coming decades.
The Map can create a shared understanding of important shifts, in turn driving new strategic thinking.
We recently hosted the CEO of a global services company, based in the US, with operations around the world. Taking him through the Industry Shifts Map helped clarify and visualize the level of change coming within his industry, and at the same time revealing how poorly equipped his firm was for the impeding shifts. He had widely read and reflected on these issues, but working through the Map by himself cemented the coming changes in a clear and visual way.
DOWNLOAD YOUR INDUSTRY SHIFTS MAP
ANALYST: STRATEGY INTRO
The Strategy Intro is often our baseline, entry level Strategy Tool. For Analysts, it gives a basic framework to balance current core business, new growth and exploring future growth areas. With the right KPIs in place, the Analyst can delight in the Strategy Intro framework. The important thing here, is being able to balance current core with exploring new growth. For most Analysts, this is challenging; most numbers, financial figures and good data is historical in nature, making any future or internal seed projects seem small and insignificant. Yet, successful transformations have taught us to strive for the optimal balance between legacy core and next, potential core areas. With the Strategy Intro, even the Analysts have a tool supporting this ambition; balance today for new growth tomorrow.
DOWNLOAD YOUR STRATEGY INTRO
SCOUT: MARKET OPPORTUNITIES CANVAS
The Market Opportunities Canvas gives the Scout a one-page framework for mapping, grasping and communicating emerging trends that might provide new, strategic market opportunities. Whether from global megatrends, new technologies or customer needs, the tool allows a simple framework for grasping emerging opportunities. The Market Opportunities Canvas is a easy-to-use tool for Scouts in any type of organization.
DOWNLOAD YOUR MARKET OPPORTUNITIES CANVAS
What’s next? The coming evolution of the Strategy Officer’s role
Whether you are an aspiring young strategy manager or an experienced influencer, one thing seems certain; the role of the Strategy Officer is rapidly evolving. For companies experiencing increasing levels of industry changes, new business model innovations from well-funded startups or a massive industry convergence, the role of the Strategy Officer is set to grow ever more important. Driving faster organizational agility, bringing new strategy tools to the job, growing a high-impact portfolio of strategic initiatives, setting up new venture CompanyX-unit and implementing strong M&A capabilities around future needs; the expectations are only set to rise.
Worldwide, Strategy Officers have an ever increasing important yet challenging job ahead. We believe understanding the Four Roles of the Strategy Officer is a starting point. Yet, the real potential for higher strategy impact, agile change and a successful future growth strategy requires a visionary Strategy Officer with the ability to activate and bring the organization along for the journey into the future
Which role do you play the most as the strategy officer? Share with me your thoughts and comments below.
ABOUT THE AUTHOR
Christian Rangen is a strategy & transformation advisor to top management, boards and strategy teams. His clients range from Malaysia, Middle East and Europe. He is Co-Founder of Engage // Innovate, a strategy & innovation consulting company and Strategy Tools.io – the modern strategist’s toolkit. He is management educator and faculty at BI – Norwegian Business School. His recent projects include Malaysian Innovation Superclusters, Corporate Innovation Bootcamps and Accelerating National Transformation projects.
He can be reached at Christian@engage-innovate.com
Successful innovation in large companies is hard. It is easy to make things complex.
We think it is better to keep things simple. Welcome to MIS, your Minimum Innovation Strategy.
Join our experiment and put the MIS to action.
Make the complex simple; like really, really simple
You have probably seen the same thing; innovation is very, very hard. It’s complicated. Complex. Open to misunderstandings and interpretations. It does not get the resources nor commitments. There is often a lack of shared understanding and shared language. It is difficult.
We have spent a lot of time working, thinking and sketching; how can we help make it simpler? How can we help large companies develop a better way, a simpler way, a minimum way?
The answer, for now, is MIS – develop a Minimum Innovation Strategy. We aim to make the complex simple. Very simple.
Building better strategy tools – and booklets to guide you
We build tools that create impact. An important part of that mission is helping users understand how to use and some best practices around using the Strategy Tools. We are now developing a series of videos, How-To guides and aids to help you put Strategy Tools to work.
For MIS, we have created a pilot How-To Guide, and hope this can help you put the Minimum Innovation Strategy to work in your own organization.
An Invitation (or really, we need your help!)
We are still building and developing the concept of MIS. We have seen it in action. We have seen the impact. But we have not seen or heard your experiences yet. So, we have a challenge or invitation for you (depending on how you see it).
Put the MIS to the test in your organization.
Post your feedback, learning and reflection on our blog, and get a 30 minute 1:1 skype session with strategy & transformation expert and Designer of Strategy Tools, Christian Rangen. Are you up for it?
How to Start
Print the MIS Canvas (that’s our word for the tool) on a suitable format paper or PVC. We recommend 120 x 90cm, or even 200 x 150cm for groups. 3 – 5 people per group is good. More than six participants and the input and engagement drops. Anyway, print it.
Invite some colleagues, co-workers or even top management to an informal workshop session (heck, you can even do this during lunch breaks).
3. RUN WORKSHOP
Set up and run a rapid workshop on the MIS in action, for your own organization. We suggest giving a 5-10 minute introduction to the tool itself. More time should not be needed.
Activate the group(s), get them working on the tool. Get them talking & writing as much and as fast as possible. If all they do is talk, just give them more pens. Ideally, each group should be getting hands on, working on the tool, not just talking to it.
Snap some high-energy photos. Feel free to post them on social media using #strategytools
Have the groups work 20 – 25 minutes on the tool, depending on the size and maturity. It might be a good idea to have a timer, counting down, to make sure everyone is on the same timetable.
Once done, have each group or group member (depending on size of the group) reflect on three questions:
- What does the MIS tell us about our current innovation strategy? (if there even is one)?
- What was the most interesting/revealing/enlightening/annoying/fascinating part of the process? (pick your own words)
- Based on the output; what should we do next?
8. FOLLOW-UP & EXECUTE
Make stuff happen. Try implementing small, incremental changes fast. Run experiments.
Write a very brief summary of your observations working with the MIS in your own organization.
What happened? What worked well? How did the group take the tool? What was the key success factor in your intro? What was the one thing the group stumbled on? What was the absolute highlight of the process?
Post your feedback in the discussion field of this post, either on our website or Linkedin article. Feel free to include some pictures.
10. DEBRIEF TOGETHER
Let’s set up a 30 minute 1:1 Skype call to go through your MIS workshop. Let’s debrief together and help us understand what worked well and what could be changed at your end.
We would genuinely love to talk with you and hear your experiences in putting the Minimum Innovation Strategy to work.
Chris & the team at Engage // Innovate and Strategy Tools.
Leading strategic transformation is one of the most challenging tasks executives face. Over the past six years, we’ve developed strategy tools to help clients navigate a dynamic strategy landscape. Today we’re pleased to announce our latest tool — The Transformation Test. Check it out and see how your company’s doing.
Over the past three years, our team has spent an increasing amount of time on strategy and transformation. The world of strategy is no longer a linear, easy, more-of-the-same, but is changing into something far more dynamic and complex. Faster change, increasing disruption, unlikely competitors emerging with very, very different business models.
Very often, industries are no longer shaped by traditional industry boundaries, but what Professor Rita McGrath calls “arenas”. Industries are no longer stable. They frequently go through strategic inflection points.
All of this requires executives in companies to put new strategy tools to the task of building future-fit strategies.
At StrategyTools.io, our long-term research program, we have developed a growing number of strategy and innovation tools in use with leading companies around the world. Many of our challenges working with clients in solving their strategic ambitions and challenges comes back to how we deal with large scale change and transformation.
To help answer this question, our team has developed a simple-to-use, easy-to-grasp strategy tool called The Transformation Test. While the applications might be profound and complex, our observation is that the tool itself gives you a quick snapshot of your company’s strengths and potentially also weakness in how to successfully lead strategic transformation.
How to Use The Transformation Test
The Transformation Test helps teams and management have strategic conversations and measure progress on the topics of innovation, business models and transformation.
It asks you questions under the different tenets of transformation — your company’s Innovation Structure, Innovation Portfolio, Innovation Pipeline, your Successes with Business Model Innovation, and finally, your Transformational Capacity.
Based on how well you answer the questions set within The Transformation Test, you give yourself a score from 1-5.
This helps give a more well-rounded angle on how well you’re doing in terms of transformation.
Download The Transformation Test free from StrategyTools.io.
Engage // Innovate co-founder Christian Rangen recently had the pleasure to sit down for a conversation with Columbia Business School professor and globally-recognized expert on strategy, innovation and growth Rita McGrath, to discuss her latest work on strategic inflection points.
As a long-time member of Engage // Innovate’s informal Advisory Board, Rita’s thinking has long been an influential and inspirational force.
In the short, but very interesting conversation, the two strategy experts delved into innovation as a repeatable process, how companies should react to the early warning signs of impending industry shifts, as well as Rita’s upcoming Executive Strategy Masterclass happening in Stavanger on May 12.
You can listen to the talk in the podcast below or read the full transcript here.
Five key takeaways:
1. How companies can think about getting into new areas
Rita’s latest research deals with industry shifts and portfolio thinking, a subject highly relevant to the declining oil and gas industry in Norway. As Norwegian executives struggle to move beyond the oil and gas industry, the first step is to recognize that what worked in the past might not be what works in the future.
Companies need to be thinking about getting into new areas.
“To me, there are two vectors you can choose. You can choose to operate from a capability platform, or you can choose to operate around a particular customer need that you’re serving.” said Rita.
Statoil, for example, could choose to operate from deep capabilities in undersea operations and other complex technical capabilities they’ve built over the last decades, or make the bolder move of defining themselves in the energy space and explore options they’ve never traditionally had the capabilities in.
Rita pointed out that Fujifilm was a good example of a company that started expanding their portfolio by operating from the capability platform.
“They decided to say, ‘hey, you know we’re terrific at chemicals, we’re terrific at imaging, so let’s find places where those capabilities come into play.'”
Today, Fujifilm’s efforts in diversification has brought them into cosmetics, medical imaging, and even services for the pharmaceutical industry. The company is pursuing a variety of different activities all linked at its core to their central capabilities.
2. Look outside your industry to get started with reinvention
When asked for a beginner’s guide for management teams that need to find reinvention, Rita advised companies not to stay within their own little bubble.
“I think there’s a need to really immerse yourself outside of your immediate context and get a sense of what’s going on in the world that may or may not have anything to do with what you’re looking at”.
How does one do this? There are a number of ways.
“You can immerse yourself in an executive program, come to a seminar — like the one we’re planning, you could go to conferences from industries different from your own.”
Rita believes that the key is to get away from the daily grind, your emails and the day-to-day, so you can really get a big picture perspective of what could be going on.
“When you make the relatively small effort — take a couple of days, go to a non-related industry conference or have conversations with people who don’t touch what you normally touch, it’s surprising how quickly the insights begin to emerge,” she mused.
3. Pay attention to the early warning signs of industry shifts
When Rita looked into the architecture behind strategic inflection points, the typical weak signals that could’ve alerted businesses in advance often go unnoticed.
“The weak signals are when something happens that creates a 10x shift in the envelope that contains your industry. If you think about any kind of sector or industry or company, they have certain constraints in their environment that are present when they’re born.” said Rita.
We’ll take the newspaper industry as an example.
Back in the day, the main constraints in the newspaper industry were things like how many contracts they had, how many trucks they needed, how many newsstands they had, etc.
Digitalization came along and transformed all these existing constraints by a factor of 10 or 20.
The changes don’t happen instantly, and they take a long time to unfold, but only the companies that prepare for them in that time can come out of the 10x shift triumphant.
Rita then pointed out Amazon as an example.
Amazon sold its first book online back in 1995. That same year, a reporter from Fortune pointed out that the internet could potentially change all the different constraints across several industries like publishing, retail and distribution.
The data were there. But nobody in retail was paying attention.
Rita believes that businesses should look out for possible industry shifts and plan ahead instead of reacting when it’s upon their doorstep.
“When you see something way off in the distance when you’re driving, you can adjust your trajectory with a relatively small shift of the steering wheel, but if you wait until it’s right upon you, you’re nearly at it. You’ll have to make that steering wheel jerk significantly to avoid the obstacle. And that’s the way to think about early warning signs.”
4. Stepping up on the Innovation Maturity Scale
Rita has developed a tool called the Innovation Maturity Scale to help companies see where they are in terms of innovation proficiency.
The scale goes from 1, where companies are hostile towards innovation, up to 8, where the leadership is committed to innovation at all levels.
Compared to the innovation maturity Rita sees during her work in California, she believes that most organizations are at a 2 or a 3 on the Innovation Maturity Scale — meaning that they have the desire to improve and innovate, but have no full-on support.
“They’ve got pockets of innovation, there are champions that kind of comes and goes. They take the big trip out to Silicon Valley, have a picture taken next to the Facebook sign, but they don’t really have it embedded as an actual proficiency in the organization,”Rita revealed.
Norwegian companies are not that different, Christian mused.
They are great at initiating innovation, but when it comes to really organizing for innovation as a repeatable process, most Norwegian companies fall short, save for a few.
“Telenor is a good example, I know Rita you have been writing about Schibsted as a good example. Kongsberg is a good example. But overall, there’s a lot of work to be done here,” Christian explained.
5. Businesses should invest resources across Three Horizons
Mature companies often face declining growth as innovation slows down. Companies that want to keep growing must not only focus on their existing business models, but also potential growth areas in the future.
“I’m a big believer that you have to be investing your resources in three kinds of initiatives. One is to keep your core business as healthy as you can, which is challenging if it’s in decline or flat. The second is to think about what you’re going to launch that is going to be part of your next core business. The third is how do you invest in strategic options, or early investments that give you the right, but not the obligation to make a significant investment going forward,” Rita said.
Both Rita McGrath and Christian Rangen will be unveiling new strategy tools at the upcoming Rita McGrath Strategy Masterclass in Stavanger. Request your invite by filling in the form below.
Work on your strategy with Rita McGrath on her upcoming visit to Stavanger. Join us for the full-day senior executive strategy Masterclass on May 12, 2017.
This is an invite-only Masterclass. Fill in the short form below to request your invite:
The Gist of It for Busy Execs:
- The Strategic Innovation Canvas is a simple, easy-to-use tool to collaborate on, communicate and develop future-oriented strategy.
- The Strategic Innovation Canvas is built upon the theories of Clayton Christensen (three types of innovation) and Rita McGrath (discovery-driven growth and short-term competitive advantages).
- Companies that use the canvas like Statoil, Reckitt Benckiser, and Biotage find that it allows them to shape a very different future for their organization.
It’s now been 5 years since the early development of the Strategic Innovation Canvas. The strategy tool has since been put to use in hundreds of companies.
We decided to take a look back at history and sat down with the original strategy tool designer Christian Rangen with a few questions.
1. What can the Strategic Innovation Canvas do for my company?
The single biggest impact the Strategic Innovation Canvas has is helping management teams and strategists to create a more future-oriented strategy.
Most companies are incredibly focused on operations and the status quo. As the pace of innovation and disruption is picking up worldwide, we believe companies need better tools for their future.
This has been the driving idea behind Strategy Tools since our early research days back in 2011. We simply must build better strategy tools and the Strategic Innovation Canvas is but one small contribution to this global challenge.
The Strategic Innovation Canvas gives you a strategic framework for developing an options-driven innovation portfolio. This builds heavily on one of our advisory board members Rita McGrath’s long-time work on discovery-driven growth and short-term competitive advantages.
Companies that use the tool like Statoil, Reckitt Benckiser, and Biotage, realize that they’re able to shape a very different future for their company simply by using a different strategy tool.
2. Where did the canvas originate from?
Early during our research, we found a repetitive pattern of thinking in threes.
Again and again we saw this becoming very apparent in the field of strategy.
One example is the old McKinsey research — The Three Horizons of Growth, where companies need to think about the short term, medium term and the long term at the same time.
Equally Clayton Christensen talks about three in terms of sustaining innovation, improving innovation, and market-creating innovations. But we realized that we didn’t really have any good future-oriented tools that brought this level of “three” into practical use.
Working with a number of companies including our good friends at Statoil, we started sketching out and prototyping the first designs of the Strategic Innovation Canvas. Using highly innovative companies like Amazon as case studies, we were able to communicate and articulate what this meant in practice.
Our goal in the early days was really to build a simple, easy-to-use visual tool that came out of fairly advanced research and understanding of how to shape strategy for the future. And i hope we have achieved that fairly well.
3. How was the early development work?
The early development work built on a lot of design workshops with the executives from many industries.
The tool was largely built through workshops and testing with executives responsible for designing and shaping strategy across many different industries.
This has not been a primarily academic research, but really a genuine co-creation with executives around the world.
Following the very early design phase, we quickly took our work on the road and presented the early designs at various innovation conferences, including Copenhagen, Cannes, and Vienna. Again the feedback that we got from the larger innovation community helped confirm our earlier experiences and helped shape this tool further.
4. What’s been your biggest learning?
One of the effects of working with the tool is that management teams, strategy teams quickly realize that most of their energy and intellect goes into core business and operational issues.
Simply working with the tool forces you and enables you to design a different strategy for the future.
Again and again we see management teams surprise themselves when they realized how operationally focused they have become, and they simply do not have a proper strategy and innovation portfolio in place.
My biggest learning has been that simply by visualizing on this and starting work on it, companies quickly adapt and start developing better strategic thinking for themselves.
5. How do you see companies using the tool? What is the best practice when using the Strategic Innovation Canvas?
Best practice is really when the tool becomes internalized by leaders and strategists at all levels.
This might take time, this might require some training sessions, but once leadership starts using the tool for their own progress, once the strategy team starts using the tool in internal sessions, once mid-level managers pull it out to start to discussing a more ambitious strategy, that’s when the tool really comes to effect.
The Strategic Innovation Canvas is not meant for a one-time, one-session use, but really it is a deep strategic tool that should be embedded into the organizational DNA.
6. What do you see next for the Strategic Innovation Canvas?
Moving forward, we see three things.
One, we see an increasing number of companies putting it to use.
Two, we see more and more strategy and innovation teams internalizing it and using it in their everyday work.
Three, we’re looking at ways to bring this into a software solution.
We are working on our book and our writing in general, to publish more content, insights, and case studies on how our strategy tools are being put to use. This has been work in progress since 2012, and we’re still trying to find time to make more of that happen.
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We are a strategy & innovation consulting firm working with companies and governments across the globe to drive innovation and uncover sustainable new growth opportunities.