The Innovation Dilemma

According to Yahoo! Finance columnist Rick Newman, “Seems everyone talks about innovation, but not everyone knows what it means.”  Today, at the Vistage Executive Summit in Austin (one of 20 events taking place in major cities across the U.S. in 2014), Newman focused on companies he described as “fanatically focused on the future.”  He talked about companies such as Netflix, Google, Apple, and Tesla, just to name a few.  And he also mentioned a few of the companies that got run over like BlackBerry and Kodak.  Citing Clay Christensen’s Innovation Dilemma, Newman said, “The innovators dilemma happens when you stick with what made you successful for too long.”

In some respects defending the companies that suffered such a dilemma, he reminded the audience that tough decisions – the ones that take place in real time (without the benefit of 20/20 hindsight), are not as obvious as they appear after the fact.  Let’s face it, “seeing the future and picking the right course isn’t easy.”   If you remember Brian Solis’ talk about “Kodak moments,” Newman took the opportunity to cut Kodak a break by suggesting that it’s hard to cut the heart out of your revenue stream in favor of an unproven new technology.   Most leaders simply won’t do it.   It’s easy to criticize Kodak now, but imagine being in the shoes of the leadership of this iconic publicly traded company at the time.

Newman also told some terrific stories about the leaders he calls “Rebounders.”  People like Henry Ford, Tim Westergren, and Reed Hastings failed spectacularly early in their careers, only to see failure as a learning opportunity and the reason to try again.

Referencing the movie Apollo 13 and the line, “failure is not an option,” Newman noted that failure is always an option – it can happen.  Successful innovation involves learning from failure and not being afraid of it!

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