It becomes increasingly clear to companies that they have been running on this fundamental fuel that they have taken for granted, called customers. And as this fuel changes its behavior, fabric and composition the engines that are running on them, our companies, need to rebuild as well.
Now there is a lag … the fuel is increasingly outpacing the organizations. And the engines that have been built are so skilled and trained to operate in the old model that they have become to expensive, complex and ingrained to change.
Unfortunately, in an increasing amount of industries, and eventually all, they have to.
The sea change
Companies having to adapt to customers and not the other way around is in contrast to the 20th century model when industries were finite and companies told people how to solve their needs.
E.g. if you wanted to handle your own money you needed to establish a relationship with a bank. If you wanted TV you had to use channels and invest in satellite or cable infrastructure through an operator. If you wanted to speak with distant friends or relatives you had to be in a specific physical location making an expensive land line phone call – and hope they were home at the other end. If you wanted to sleep in a different city you needed an hotel. If you were sick you needed to go to the doctor. If you wanted to go somewhere with public transport the solution was a contaminated container on wheels, rails or wings. If you wanted to take a picture you needed a camera and some film (and make sure there is film in the camera – but how do you do that without destroying the most recent pictures?). If you wanted to buy something you needed to walk or drive to a store, and only had access when the shop’s human operators were present.
Now, some of these examples are already broken, and some will break. And it is easy to see the new solutions to what is already broken, like TV, hotels and cameras. But it is difficult to imagine what hasn’t been truly broken yet, like doctors, public transport and banks. But they will come.
«Innovation efforts are engineered to fix problems instead of breaking them»
When an industry breaks it unleashes the realization that the opportunities given to customers are infinite. Meaning that people are no longer taken hostage by stringent products and strict processes, but can solve their job and reach their goal they way that is best fit for them.
It liberates customers but overloads the oiled machineries designed for efficiency and promotion of standardization.
So companies get to work to fix the problem. Unfortunately the current tools for redesigning engines has some obvious blind spots, hampering companies’ ability to become a part of the future. Blind spots so hard coded into employees through rigorous training in how the world works that it becomes difficult to break from them. This is where the current system of innovation fails and becomes a disease more than a solution.
«Innovation becomes a disease more than a solution»
This is the core of the problem: Customer driven changes aren’t skin deep. They are fundamental on the part of the customer. But so fundamental that they shake the core mechanics of what the current product and services are built on, a depth in which few companies dare to wade when they are investing in potential futures.
And in all this digital has not become the solution but a part of the problem.
«Are companies using digital to recapture their hostages instead of joining the liberation?»
What seems to happen is the failure to admit to the gravity of importance the customer is as a fuel to the engine. And that the change is not about competitors getting faster or simpler, but customers given new choices changing the architecture of how they do things. It’s not that pre-digital products become to complicated or to slow, they become irrelevant.
«Digital is not about old products or services becoming to complicated or to slow, they become irrelevant»
Paraphrasing Jeff Jarvis at TNW 2016 – The old media companies completely fail to see what the big four (Facebook, Amazon, Apple and Google) are doing. They are not oiling their machineries to become faster and simpler, they are moving from mass to building personal services companies (or rather, they did the move a decade ago).
In the next part of this article I will get into the three core mechanics that, in my experience, are the most important and most overlooked when it comes to innovation. To be continued…