Many companies choose to innovate based on their analysis of motivation to innovate vs. their ability to sustain this process. Outside factors, such as government regulations, industry norms, and cultural values, can have a profound influence on these motivations and abilities. A company’s motivation is often determined by the size of the market, the competitive dynamics and forces within this market, and the economics of opportunities available. Ability is often determined by a company’s resource availability, standards, access to markets, and industry development. (Christensen, Anthony &Roth, 2004).
Companies fall on a scale of varying motivation and ability. In Seeing What’s Next, the authors name four categories to describe this balance: hotbed innovations, innovations with barriers but possibilities, innovations which are simply looking for money, and a lack of innovation. Entrepreneurs must analyze their company’s position, in combination with its motivations and abilities, to decide if an innovation is worth pursuing.
“Hotbed” innovations are typically found within emerging industries with lots of room for growth. They are characterized by high motivation in conjunction with high ability. Take the following fictional example: John Rice Partners, an established law firm in Anywhere, USA, is thinking of developing an online legal program, providing service to clients across the country. Their strong desire to expand the reach of their business (motivation), coupled with their trusted expertise, well-integrated technological systems, and lack of competitors (ability), make this a strong venture, likely to succeed.
Innovations with “barriers but possibilities” are characterized by a strong motivation, with external barriers that can impede a company’s ability to execute. Creative innovators can circumvent barriers to increase their company’s ability, in turn increasing the viability of the venture. A fictional example: Little City Cycles, the largest retailer of bicycles in a large urban area, has decided to add guided bike tours to their business offerings. They are highly motivated to add this service, but are limited by local laws which heavily restrict the use of bicycles for commercial purposes (a barrier). The company approaches local city legislators with their business plan, providing a summary of how their plan would increase tourism and thereby increase city revenue. Considering this potential increase in revenue, and the presence of multiple bike shops who may also develop similar businesses in the area, the local government passes legislation lifting many of the legal barriers to this innovation. Ability is now increased.
Companies that are “just looking for money” possess a high ability, and low motivation to innovate. These innovations are primarily deemed revenue-builders, but their success is limited by a lack of motivation within a company. Innovators must examine the business, and the lack of motivation, and either find ways to improve the motivation, or abandon the project altogether. Here’s another fictional example: Wall of Art is an established and successful art gallery in a bustling art district of a medium-sized town. Recently, many galleries converted their unused spaces into classroom space, designed specifically for “pop-up” art classes (an emerging fad). What began as a promising innovation has proven unsuccessful for many galleries, due to a surprising lack of community interest. While Wall of Art is certainly equipped to adopt a similar innovation (high ability), they lack the motivation to do so based on the lack of interest they have witnessed in their community at large. It would be very hard to increase Wall of Art’s motivation without re-designing the idea to reach a broader population, or marketing the service to a different demographic, though these are possible solutions for improving motivation. If Wall of Art felt there was no way to re-work this idea to become more profitable, they would likely abandon the innovation altogether.
The final scenario the authors describe is “complete Lack of innovation”. It goes without saying that if a company lacks motivation or the ability to innovate, it will not become a successful innovator. Clearly, a business example is not needed to illustrate this case. It is important to remember that motivation can be inspired by examining the gaps in a certain industry and developing ways to bridge these gaps through innovations. Capable innovative leaders can identify untapped or overshot customers within a market, and use analysis of emerging trends to determine where innovations have strong potential for growth. They can then use this information to support and inspire motivation for the innovation.
While the “hotbed” scenario is the most likely to succeed in the long run, innovations that experience barriers, but retain possibility, also have a good chance of success with the right creative solutions and innovative thinking. It is worth noting that, at times, it may be easier to work around a lack of ability than a lack of motivation. The low motivation scenarios are, perhaps, two of the most perilous scenarios. Innovators must determine if there is a way to inspire or increase motivation by removing barriers, or if the idea is futile and should be abandoned entirely. To avoid this conundrum, innovators should focus on ideas their organizations will feel motivated to pursue and have some ability to sustain.
Source: Christensen, C.M., Anthony, S.D., & Roth, E.A. (2004). Seeing What’s Next: Using the Theories of Innovation to Predict Industry Change. Boston, MA: Harvard Business School Publishing Company