Friday, April 1, 2011

What Coffee, Bleach, And Bondi Blue Teach Us About Innovation

Do you believe silicon chips are superior to potato chips? That Amazon and Gilt Groupe are inherently more entrepreneurial than Wal-Mart or Tesco? That McDonald's or Pret a Manger is less open to disruptive innovation than El Bulli? If you believe any, or all, of those things, then you're not a business sophisticate, you're an innovation snob. For shame. Be warned: uppity attitudes undermine companies and careers.

Airy — dare I say arrogant? — dismissal of perfectly profitable innovations because they're not digital, technological, or fashionable reveals more about elitist snobbery than market substance. It's a bit like declaring college dropouts — you know, like Bill Gates, Larry Ellison, Michael Dell and Mark Zuckerberg — entrepreneurially inferior to Harvard MBAs. Not even Harvard believes that (anymore).

My concern over innovation condescension was provoked by surprising comments on a previous post. Apparently, many respondents don't believe that a new bleach was innovative enough to merit more than a dismissive shrug of cynical shoulders. Big deal. After all, it's just bleach, you know? There's nothing innovative about bleach. Sodium hypochlorite is sodium hypochlorite.

I'm gobsmacked and appalled. Tell it to Howard Schultz. After all, Starbucks just sells coffee, you know? Oh, and now Starbucks sells instant coffee. What could be less innovative? How trite and trivial. Instant coffee is unworthy of the innovation appellation. The entrepreneurial Schultz should be ashamed of himself. That fast-growing Via extends Starbucks into customers' homes shouldn't obscure the reality that instant coffee is about as innovative as better bleach.

But why stop with mocking Howard's brew? McDonalds' McCafe plunge into premium coffees (both iced and hot) isn't innovative either. To heck with the sourcing, the scaling, the packaging, the testing, the training, and the promotion required to compete head-on with Starbucks — and do well. That's mere imitation. For Mickey D's, a new line of coffees is pure line extension. Nothing new or novel here. It's just coffee. Does it successfully generate traffic and revenue? Sure. But it's still a "Me, too" or even a "Me, three" offering.

Consider one of coffee's most successful innovation spinoffs. You'll find one (or two or more) in your car. What genre of breakthrough innovation do automobile cup holders represent? They're literally holes in doors and dashboards or molded interior mounts. Are they "real" innovations or gimmicks? Auto interior designers loathed them. While automobiles embody many of the most sophisticated technologies around, innovative cup holders influence mindshare. One of America's most sophisticated design and engineering critics observed that: "I have repeatedly heard articulate people say that their family's latest automobile purchase hinged on which cup holders worked best for them."

How vulgar and crass. How dare the commercial fate of a $40,000 vehicle depend on the depth, style and number of cup holders. Shouldn't prospective purchasers be more concerned about gas mileage, sustainability and safety ratings? People are innovation idiots. Top Gear doesn't do cup holders.

Abandon these low-brow innovation ignoramuses. Apple and Steve Jobs surely offer a safe haven for innovation elites. After all, Apple has branded itself as the "think different" innovator for snobs of all ages (yes, this is being written on a Mac Book Pro). Alas, history makes Jobs out to be less an innovation snob than a man of the masses who grokked that stylish, low-cost imitation could be very innovative if you sell it right. Most digerati know that much of the original Apple Lisa and Macintosh hardware and software were knockoffs of the Xerox Palo Alto Research Center Alto computer. No snobbish "Not Invented Here" theatrics from Jobs. This was more "Good artists copy, great artists steal" innovation epiphany.

Instead, the computational cognoscenti condescended to Jobs back in the mid-90s when his Apple came out with its iMac line of personal computers. These machines featured immaculate industrial design (courtesy of a young Jonathan Ive) with colors like Bondi Blue, but featured digital technologies that failed to impress the Palo Alto crowd. They thought the machine a beautiful toy. Oh, the humiliation! No matter. The iMacs sold extremely well and helped save the company. Design innovation mattered more than technical innovation. Somehow, Jobs managed to overcome the Silicon Valley snobs.

Innovation snobbery is a market signal. Pay attention. The moment that everyone agrees innovation has vanished from "ordinary" products, processes or services — or simply doesn't matter — is the moment when real entrepreneurs and innovators are best-positioned to disrupt. Credible competitive threats can, and do, come from the most ordinary of sources. Listen to channels, partners and competitors who wave the backs of their hands and treat seemingly incremental innovations as nothing special. Then listen to what customers and clients say.

Andrew Grove declared "Only the paranoid survive" for good reason. Paranoids make poor innovation snobs. The next time you — or a colleague — smirk at an innovation offering, please ask yourself: Does that sense of superiority come from what you think significant or what customers might think important?

I still don't know that what Clorox did to P&G was ethical or appropriate, but I'm positive that Clorox took its rival seriously. The strategic issue with innovation snobs is that (too) often they don't recognize either disruptions or revolutions until it's too late.

Michael Schrage, a research fellow at MIT Sloan School's Center for Digital Business, is the author of Serious Play and the forthcoming Getting Beyond Ideas.

Thanks to Blogs HBR

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