Rita Gunther McGrath - Columbia Business School professor, strategy expert and author of The End of Competitive Advantage - argues that success in today's volatile business environment will be about "capturing opportunities fast, exploiting them decisively, and moving on even before they are exhausted."
In other words, time to let go of the notion of a sustained competitive advantage and embrace the idea of one that can only be transient.
Winning in the age of transient advantage, according the Gunther McGrath, demands a different approach to innovation than what most organizations practice; one that is continuous, ongoing and systematic. Not something that people already working long hours do in their "spare time."
Moreover, what many companies don't realize is that crucial aspects of the innovation system require real expertise that needs to be built up over years. Trend analysis, market sizing, options analysis and valuation, designing prototypes, creating discovery-driven plans, running pilots, leveraging opportunities, and making the transition to a scalable business are all activities that take time, effort and experience to get good at. In most companies, there is simply no career path that consistently helps people to develop these skills.12 And in most companies, even if someone were to try to develop these skills, there are few rewards for doing so.
In the 2009 Harvard Business Review article that Gunther McGrath references above (Create Three Distinct Career Paths for Innovators) Rensselaer Polytechnic Institute associate professors Gina Colarelli O’Connor and Andrew Corbett, along with consultant Ron Pierantozzi, present their case that companies fundamentally mismanage their innovation talent. To help remedy that problem the authors define the three phases, each with their own skill set and career path, that underly breakthrough innovation:
Phase 1 - Discovery: Create and identify opportunities in the marketplace. Explore fit between technological capabilities and marketplace needs.
Entry level skills include: (1) scientific and technical acumen, and (2) systems thinking.
Mid level skills include the ability to: (1) make connections across opportunities, and (2) broaden opportunities through imaginative thinking combined with deep knowledge of emerging product market domain.
Senior level skills include the ability to: (1) lead conversations about strategic intent, and (2) collaborate with technical leaders outside the company.
Phase 2 - Incubation: Experiment in order to create a new business that delivers breakthrough value to customers and to the firm.
Entry level skills include: (1) comfortable managing ambiguity, and (2) ability to assimilate new information and change direction.
Mid level skills include the ability to: (1) experience managing small projects, and (2) interpersonal coaching skills.
Senior level skills include the ability to: (1) evaluate the relative economic, market and strategic promise of opportunities, and (2) manage cross portfolio synergies and dissonance.
Phase 3 - Acceleration: Nurture the business until it can stand on its own.
Entry level skills include: (1) traditional functional skills, and (2) ability to be both agile and disciplined.
Mid level skills include: (1) traditional leadership skills for a specific function (analytical, sales oversight, decision making, strategic).
Senior level skills include the ability to: (1) act as a general manager for a high-growth business.
Is Gunther McGrather right? Are we systematically overlooking and underappreciating the skills and attributes necessary to build a genuine innovation proficiency in our organizations? Given her finding that this is a distinguishing trait of organizations who have been able to thrive and grow while surfing the wave of transient advantage, it's worth considering.
And the template that O'Connor, Corbett and Pierantozzi present in their HBR article (of which I've only highlighted parts here out of respect for their content) provides us with a handy beginning template against which to do our own audits of innovator roles design, career paths and total rewards.
Is there an asset more critical to building innovation proficiency than people? Time to get the roles and rewards of innovation right!
Ann Bares is the Founder and Editor of the Compensation Café, Author of Compensation Force and Managing Partner of Altura Consulting Group LLC, where she provides compensation consulting to a range of client organizations. Ann serves as President of the Twin Cities Compensation Network (the most awesome local reward network on the planet) and is a member of the Advisory Board of the Compensation & Benefits Review, the leading journal for those who design, implement, evaluate and communicate total rewards. She earned her M.B.A. at Northwestern University’s Kellogg School, is a foodie and bookhound in her spare time (now finishing Rita Gunther McGrath's "The End of Competitive Advantage"). Follow her on Twitter at @annbares.
Creative Commons image "Ideas Never Run Out" by adihrespati
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