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December 30, 2013

How To Speak Global

Posted by Sanjay Dalwani (View Profile | View All Posts) at 9:40 AM

Can you speak Esperanto? [Source: http://www.youtube.com/watch?v=MjB0v87oMD8]

Remember Esperanto? Several decades ago, an assortment of academics and linguists invented a language that would become (they hoped) the world's common language.

It was a flop. But I must say that the intentions behind Esperanto were admirable. If people involved in international business all spoke the same language, wouldn't it be great? Being able to communicate effortlessly across regions and markets would be immensely useful. Well, yes and no. Some other research out of academia finds that enterprises that embrace other cultures, languages, and ways of doing business are at an advantage. You might think that in the age of globalization, these findings would be obvious. But drill down a bit deeper and the reality is that many organizations expand into other countries without giving those new regions and markets much thought.

Such companies would do well to spend a lot of time analyzing how best to adapt to new markets. Any organization can expand by opening new offices overseas. But the successful ones approach each market differently. Of the many things that make me proud to be an Infoscion, is our ability to be very aware of whatever market we enter. Our company's success continues to be predicated in part on our knack for "speaking global."

Our company's recent surveys of digital consumers have been incredibly enlightening from the standpoint of how each market must be approached in a particular way. What flies in Australia might not be the way to do something in, say, South America. Therein lies the both the promise and the complexity of digital commerce. Organizations can reach more people and empower more customers than ever before. But there is no "one-size-fits-all" strategy.

Talk to any of our colleagues who work with consumer packaged goods companies. Being a CPG is a challenge, especially one that hopes to expand in the emerging markets. One of the tried and true marketing strategies of CPGs in the West is having a presence in television and print media. In the emerging markets, having a presence on the mobile devices of the customer base is far more effective. Sometimes enterprises go global with the expectation that what works in their home country will be accepted in other markets, even if it isn't something to which customers in the new country are accustomed. Not true. It's important to consider all perspectives that your regional partners and new markets can have on what might be old hat to your home office.

We've all heard the adage about thinking globally but acting locally. There's a lot to be said about learning from customers in each market all while being part of a larger corporation and the economies of scale that go with it.

Until international commerce and finance develop their own version of Esperanto, we should be focused on learning as many languages and dialects as we can.

December 27, 2013

Brewing Up Business Incubators

Posted by Mohit Joshi (View Profile | View All Posts) at 9:35 AM

Brewbound Session 2013 - Boston - Innovation Strategies with Jim Koch of Sam Adams [Source: http://www.youtube.com/watch?v=_SINQgYUDpo]

One of my favorite lighthearted quotations comes from Benjamin Franklin: "Beer is proof that God loves us and wants us to be happy."

Nobody ever said that profitably producing all that beer was an easy, stress-free process, however. Jim Koch should know. He's the founder of the Boston Beer Company, which produces the upscale Samuel Adams Lager. Before his beer became a runaway success and pretty much created the craft-brew market, Koch faced the struggles and challenges common to many owners of small businesses.

Besides being an aficionado of crafting beer on a relatively small scale, Koch is an advocate of providing small-scale loans to budding entrepreneurs. Koch says that he wishes he knew everything he knows now when he was starting his brewery some 30 years ago. In that spirit, he lends out anywhere between $500 and $25,000 to entrepreneurs in the hospitality sector.

To be sure, Muhammad Yunus has been a proponent of micro-lending for years now. The chairman of the Indonesia-based Grameen Bank won a Nobel Peace Prize for advancing the practice of loans in developing countries. The practice has shown itself to be very successful: When people get enough money to get their businesses started, they're more likely to develop the skills required to sustain those businesses, take care of themselves, and think about how they can help their neighbors become self-sufficient as well.

Of course, eradicating Third World poverty through micro-lending is a bit different from a Boston or Philadelphia businessman wanting to open a hip restaurant. Nevertheless, the Boston Beer Company's Koch knows his market. He also offers free business counseling services to would-be restaurateurs and the like. His reasoning is that although someone might have a recipe for success with a hotel, that person doesn't necessarily know how to tackle vital business processes. Why is Koch seemingly generous with his time and money? Isn't he concerned that he might help create the beer brand that disrupts the craft brew market and puts him out of business? I suspect it's because entrepreneurs know that competition is a healthy thing; there's always room in any market for more innovation.

I don't watch much television, but when I do, I enjoy "Shark Tank." The premise is that rising entrepreneurs get a couple minutes to present their ideas to a panel of eminently successful businessmen. When the business shows promise, the fun is seeing the rich men and women compete with each other to get the contestant to choose their offers. Generally, the contestant is left deciding between two options: either to give up a larger stake in the business but with more seed capital or allowing a smaller stake with less of an initial cash infusion from the mogul.

How the entrepreneur makes the decision says a lot about how innovative the product or idea is. If it's a groundbreaking item, then he can confidently assume that he'll make enough money on it someday such that he wouldn't mind the tycoon having a larger stake in the business. Getting it to market quickly is more important. But perhaps the innovation is a slow-and-steady proposition that requires less of an initial cash infusion. He'll want to own more of the company in the long term.

Of course, today's marketplace requires a lot more engineering rigor and is less tolerant of people who come equipped solely with big, sweeping ideas.

That's why when Jim Koch offers insights toward starting businesses, it's an economically healthy move. When entrepreneurs can openly operate and thrive in the marketplace, everyone tends to enjoy the fruits of their activities.

December 24, 2013

Technology Moves Management At Light Speed

Posted by Ravi Kumar S. (View Profile | View All Posts) at 9:04 AM

Kodak: From Blue Chip to Bankrupt [Source: http://www.youtube.com/watch?v=wwfwr8eYP50]

We all have strategy maxims we cherish. So it's not easy for me to challenge the well loved musings of the greatest business thinkers of our time. I'm not the only one, however. Several strategists, for instance, have been questioning the notion that enterprises must focus primarily on building up long-term competitive advantages.

Yet it seems technology has created markets and enterprises that come and go like the wind. If we concentrate on parsing Big Data and focusing on the market-related issues of the moment, it more often than not seems that there is also a need to build 'transient competitive advantage'. This idea is one of several that have come from an ingenious essay by a well-respected business strategist.

One of the most striking things he reveals is that that every two weeks a new company replaces an old one on the Standard & Poor's 500. Plus, in recent decades the average lifespan of a company has declined sharply to 20 years from 60 years. If your organization does build up a solid competitive advantage over your rivals, chances are that advantage won't last very long - whereas in the old days it would sustain the enterprise for years against all newcomers.

Another change is something that's no less amazing: the transformation of the economy to being one that relies on information rather than knowledge. What's the difference? Well, consider the fact that the Centers of Disease Control in the U.S. was accustomed to charting out where outbreaks of the flu would be each year. Not surprisingly, the effort would take some time. Crunching all that data is a big job. Then Google came along and said "Let's look at Web searches for things like "symptoms of the flu" and see where most of them originated. In the matters of hours, the company was able to plot out patterns of where the virus was appearing.

The challenge is also to rethink the whole notion of who your competitors are. Today's most formidable companies don't allow themselves to get pigeonholed into one or two sectors. They view themselves as multi-faceted and disruptive. Doing so allows them to dominate their markets but also create new ones.

The next time you have a planning session - and many of you will because it's the end of the year - try thinking about what your department does in terms of innovating. Try coming up with ways to apply existing technologies to entirely new industries. When the bookseller Amazon had to build an enormous computer to facilitate its retail network, they realized they could rent space on that computer to other organizations. The late Steve Jobs excelled at doing this. He came to the conclusion that not only could his company sell music players; they could dominate the space of the creative content on those players.

Along those same lines, the essay I recently read speaks of the fact that Google looked at its algorithms and began thinking that besides helping people search for things on the Web, that same computer power could make a care drive without a person steering it. Pretty innovative, right?

In the same vein of end-of-the-year predictions and planning, I urge everyone, while thinking about making game plans for the long-term, to also think of what their enterprise will be doing one week or one month from now. That long term competitive advantage is certainly important, though not always good enough to win opportunities on the turns and gain powerful advantage in the short term.

In today's automated world, chances are you won't even know what will be happening in the next week or month. So why act like it's 1955 and come up with ultra-traditional strategic planning documents? Time to start running our strategic missions like we belong in the here and now.

December 23, 2013

Making Christmas Merrier

Posted by Paddy Rao (View Profile | View All Posts) at 6:22 AM

Retailers Go High-tech With Online Shopping [Source: http://www.youtube.com/watch?v=OsxkzlMapFI]

Nobody is suggesting you not wait for a jolly old elf to leave you presents this holiday season. But if you're really hedging your bets, perhaps you should get to know some applications that help you shop online.

Long gone are the days when a handful of sites offered a limited supply of books and CDs. Today the selection of wares you can find online is dizzying - and so is the number of retail sites. I like to use the analogy of trudging through the rain to go to a store only to find that its shelves are bare and the sales associates are rude. You probably wish you'd found a different store before setting out on your time-consuming journey. It's no different with shopping online.

Digital consumers are a very aggressive bunch. They want their devices not only to guide them through the throes of shopping but also to view and act on suggestions based on their buying habits. Credit Big Data and the sophisticated analytics that go with it.

We've heard a lot about Cyber Monday over the last few years. It's the Monday that follows the American holiday of Thanksgiving in late November. The day was an unofficial start of the holiday shopping season in earnest. But a funny thing about technological progress: Pretty much every day in December has become its own version of Cyber Monday. No longer do we set aside one day to do our online shopping. To do so would be very late 1990s, wouldn't it? A consumer firm discovered that one-quarter of all working Americans spend four hours or more shopping online for holiday gifts during their work hours on Cyber Monday. Little do many of them know that with the right app, they can shop when they're not nearly as busy with their jobs and when their supervisors aren't looking disapprovingly at their screens!

Shopping apps leverage metadata to chart your shopping trip for you before you've even turned on your search engine. Such apps can use retail competition to your advantage; that is, allow stores to bid on you as a customer. Talk about being empowered in the digital age. It used to be that you bid against other consumers as the price of a product went skyward.

There's yet another aspect of the hifalutin auction that has turned itself on its head because of digital commerce: Only the wealthiest of consumers used to be able to order of bid on "bespoke" products. Now retailers use data to customize every solutions, service, and product to every consumer who expresses interest in an item. The advantage to the retailer is that the consumer perceives this action as going well beyond the call of service.

Little do they know that because of data analytics, digitally enabled stores are now as speedy and as keen as a big holiday elf.

December 20, 2013

Why Customer-Centricity Has Come Full Circle

Posted by Sanjay Dalwani (View Profile | View All Posts) at 9:24 AM

Customer Centric Innovation: Vittorino Filippas at TEDxUniTn [Source: http://www.youtube.com/watch?v=kFh3Q2eOZ1U]

One of my favorite stories about fast food innovation dates back some 35 years ago. That's when the manager of a McDonald's started putting a poached egg, a slice of cheese, and Canadian bacon in between two toaster muffins and selling it as the Egg McMuffin. That one breakfast sandwich allowed him to extend his franchise's hours. But it did something else: It gathered the attention of the company's top brass. Although McDonald's was and is a massive corporation, it organized itself so that an innovation could come from anywhere - even off the grille of a store manager in some obscure small town.

Today we're seeing a variation on this theme and it's all thanks to the rise of the digital consumer. In certain cases, customers around the world are becoming as powerful as R&D squads at major enterprises. Consider what's brewing at Starbucks. There are reports that the latest fad - adding a bit of fizz to their traditional hot and iced coffees - is something the corporate chiefs at Starbucks are watching with intense interest. Rather than discourage the practice, the company is quietly telling its Baristas to give in to the growing numbers of orders for carbonized drinks. Starbucks could have easily squashed the fizz movement. But maybe an upstart competitor, looking to find a new market and disrupt an established player, would have jumped on the carbonation bandwagon. Its first-mover advantage could have knocked the wind out of Starbucks' sails (and, more importantly, sales).

Even Howard Schultz, the company's hard-driving CEO, is referring to fizzy drinks as a new segment for the company. That's huge. Traditionally a consumer products organization tells its customers what they will want year after year. They use a savvy mix of marketing tools and overt advertising to start consumer trends. So it's noteworthy that Starbucks is doing quite the opposite by allowing customers to dictate what the company's newest segment will be.

In the old days - I'm talking 10 years ago - people didn't have the extensive social networking capabilities they have now. Word of mouth actually took some measurable amounts of time. Nowadays a trend can become such in the matter of an afternoon. It's why customer-centricity has returned to our vocabulary. I say return because in a bygone era, the "customer was always right." But after mass production created more of a take-it-or-leave-it mentality among retailers, customers learned the hard way that they had less influence than they'd thought.

Being responsive to customers is a must in today's global marketplace. Ask the people at Krispy Kreme, the quaint donut chain. They know that to grow and to grow big, they must expand in India. But many Indian consumers (especially Hindus) would want nothing to do with donuts made with animal-based products. So the company ingeniously has invented a recipe for vegan donuts that it claims retains the same decadent taste of its age-old donut recipe.

What's even more interesting about customer-fueled innovations is that new businesses tend to grow up around those innovations. So it's a chain reaction and where it stops, nobody knows. What we do know is that customers are exercising their options more than ever before.

December 16, 2013

Variety Is the Spice of Global Finance

Posted by Rajashekara V. Maiya (View Profile | View All Posts) at 4:32 AM

BBC NEWS Is Bitcoin the future of currency? [Source: http://www.youtube.com/watch?v=VMuN4QTp_oo]

One of the more interesting debates in the realm of digital finance is whether Bitcoin is the way of the future or a flash in the pan. To supporters, the world needs an online currency that falls out of the purview of central bankers. Their reasoning goes that if politicized central banks don't have the ability to print more paper money every time their country's economy takes a tumble, the currency will more closely resemble an inflation-proof entity more closely aligned with gold. That's because there are a pre-determined number of them and additional units cannot be minted.

Detractors say many things, not the least of which is that without central bank oversight and an existence solely in the virtual sphere, Bitcoin isn't immune from cyber-thieves who could conceivably hack into the stash on your hard drive. In fact, one of the appeals of precious metals like gold is their physical existence. Of course, if you count existence as a file on your computer, then you might have a better time accepting the basic idea behind Internet currencies.

Despite the fact that we don't know how the so-called crypto-currency fad will play out, it can be valuable to investigate, as it were, both sides of the coin. What I mean is that Bitcoin isn't immune to the forces of market disruption. Far from creating its own market, Bitcoin is simply one of a handful of financial innovations that might take the global economy by storm in the next few years.

One would-be currency to watch is Litecoin. Its value proposition revolves round its status as an opensource currency that has the potential of being more accessible than Bitcoin. That's because Litecoin reportedly uses an algorithm that allows it to be "mined" by standard computers. I'm also fascinated by Peercoin, which the press states ranks fourth in market capitalization of all the alternative digital currencies. Peercoin brings new security measures that focus on preventing "group mining" - a cause for concern among some of its rival crypto-currencies.

Then there's Novacoin, which also tries to protect its owners form group-mining schemes. It tops out at 2 billion units, which is about 20 times more than most fo the other currencies. The idea here is that inflation - a little, at least - isn't necessarily a bad thing. Another entrant to the space is Namecoin, which, I think, could have asked their marketing department to work harder on a name. In any case, Namecoin brings something interesting to the game: its own DNS protocol. That allows it to operate outside the part of the Internet governed by the Internet Corporation for Assigned Names and Numbers (ICANN).

I think Quarkcoin is a currency to watch if only for its reported nine rounds of encryption using six algorithms. It's a new entrant into the space that takes the crypto part of crypto-currency to new levels.

No doubt about it: If a new cyber currency suddenly skyrockets to over $1,000 per unit, it's likely to draw plenty of other players to the space. Many of them share basic programming fundamentals and use similar Internet protocols, which is why it's anyone's guess as to which currency will come to dominate the space. When a technology is largely the same, it's a test of entrepreneurs to focus on other parts of the value chain.

Could the current computer masterminds behind crypto-currencies be budding marketers as well? They probably don't think of themselves as such. People who excel in developing algorithms seldom think of that side of the business. But in the world of digital finance, with many entrants striving to break away from the pack, perhaps it's the cyber-marketers who will dominate the currencies of the future.

December 13, 2013

Reach The Next Billion - Accelerate Profitable Growth In The Emerging Markets

Posted by Sanjay Purohit (View Profile | View All Posts) at 8:56 AM

Emerging markets are a veritable gold mine for global consumer brands that face slowing growth in the developed markets. Mining that gold profitably, however, is no walk in the park. These markets present significant challenges to brands.

Emerging markets are a complex maze of traditional retail structure dominated by millions of small retailers (India alone has 12 million). Due to the high costs and logistical nightmare involved in reaching these retailers, brands depend on thousands of independent distributors to connect them with retailers and customers. They also provide local market intelligence to complement sales and marketing efforts of the brand. However most of these distributors are not technology enabled, have no standard way of maintaining sales and demand data and, more often than not, fail to share vital information with brands. Due to this lack of visibility brands don't know what is selling, where it is sold, what customers are buying, whether product quality is being maintained, and how much inventory is present and at what locations. This drastically reduces their ability to sense and respond to market demand.

Here's where Infosys has stepped in with TradeEdge - introduced on December 9, 2013, it helps brands increase market visibility, expand customer reach and lower costs. It is already helping 10 global brands increase sales by up to eight percent, expand reach in over 70 countries, and gain visibility into sales exceeding USD 20Billion.

Watch these videos or visit the website to know more about how global brands can grow profitably in the emerging markets using Infosys TradeEdge.

December 12, 2013

Why It's Either Rise or Demise For Them

Posted by Puneet Gupta (View Profile | View All Posts) at 8:39 AM

iOS 7 vs Android Jelly Bean vs Windows Phone 8 vs BB10 [Source: http://www.youtube.com/watch?v=xJkB8PFD-eo]

Today, the Android computing platform boasts a 72 percent share of the 1.5 billion smartphones in use on Planet Earth. That's up from 55 percent one year ago. Apple's iOS comes in at an 18 percent share, holding steady from about the same share last year. It helps that Android accounts for 80 percent of the new smartphones hitting the market this quarter. So it's likely that its share of the market will only increase for the foreseeable future. The most interesting aspect of this? Blackberry, which used to command a majority of global market share up until a few years ago. It's once-sizeable lead of some 40 percent market share in 2008 eroded to just 4 percent this year.

True, Apple's iOS remains popular in the United States. But Android is the undisputed smartphone champ when you look at the global market as a whole. In the rapidly growing smartphone markets of China and India, for instance, Android is the platform of choice. Those two markets, along with other large, emerging economies, are where much of the smartphone-and-tablet story will play out in the coming decade.

The quickly evolving market for mobile platforms should serve as a lesson to all of us in the technology sector. You're only as good as your most recent product or service. That particular product or service might be an update to a long-running brand or it might be an entirely new offering. Either way, it pays to keep your enterprise focused on new entrants and how they approach a market in which you hold a comfortable lead. Blackberry continues to be the mobile platform of choice for some large corporations. What we've seen, however, is that consumers have no qualms about using one platform for work and an entirely different one in their personal lives. I would have never predicted that millions of smartphone consumers would pay for the privilege of carrying around two devices. Who welcomes that inconvenience? Apparently lots of people.

Since the dawn of the Industrial Age we've seen numerous organizations go belly up very quickly because of their complacency. There's no other word for the phenomenon. These are companies that often have superior technology, ancillary markets for servicing and spare parts, and - like Blackberry - a lock on a lucrative segment of the market (i.e., the corporate world).

To Blackberry's credit, its parent company announced that it would manufacture new phones that would increasingly run Android-based applications. A generation ago, that's what Microsoft executives referred to as riding the back of the bear (in that case, IBM). If you acknowledged the market presence of a strong competitor by suiting some products to their technology, you could position your enterprise using a "me too" technique. In time, if your products worked well and you chipped away at other parts of your competitor's business, your company would have a "just me" situation on its hands.

In some ways, Android carved out an entirely new market for itself. It outfitted phones that are affordable to many people, not just executives at multinational companies. That the company that once dominated the market through MNCs is now running Android apps is fascinating. A smaller niche with higher margins might not be the end-all.

If history is any guide, the Android franchise should keep one eye open while sleeping at night, if it sleeps at all. Despite the fact that it has won the race for smartphone dominance, it's hard to say if that race will ever be over.

December 9, 2013

Converting First-Timers Into Repeat Customers

Posted by Mohan Kumar Krishnan (View Profile | View All Posts) at 10:04 AM

Changing the Retail Story: Rachel Shechtman at TEDxHollywood [Source: http://www.youtube.com/watch?v=fbnWY-swsK0]

Global newspapers and magazines pride themselves on being arbiters of grammar and usage. I read with delight that certain publications will now accept the spelling of email without a dash as well as the verb "to tweet." However, many still frown upon using modern terms like "friending" and "googling." Regardless of the acceptability of these terms, the influence that social networks and the internet in general has on shopper behavior is something that cannot be disputed.

Getting inside the heads of shoppers is a daunting task. If our enterprises could read minds, businesses would all be eminently successful. They'd know how to tap into the consumer subconscious with surgical precision. Until they are able to read minds, however, the closest thing that organisations have to really knowing their consumers is crossing the digital divide. I call it a divide because even though it's close, it's nevertheless a challenging thing to traverse. The challenge with digital interactions is in capturing the right data as well as in deriving the right insights automatically. This, when compared to how a sales person learns about shopper needs, interests and priorities during a human interaction, is reasonably complex.

The dynamics behind getting "friended" to a retailer or to "google" for a product is key to understanding how a first time shopper can be converted to a loyal, repeat customer. When potential shoppers search, read, rate or communicate about products, invaluable information is made available about how they think. Different companies approach this issue in different ways. Some create their own networks and create enough incentives for shoppers to join them. Others try to get intertwined to mainstream social networks by inviting shoppers to befriend them. Regardless of the method, the objective is to understand affinities and priorities - like affinities to categories or brands and priorities about price or time-to-delivery. The other important aspect that can be learned is the relationships between shoppers - which can be a very useful map.

A similar learning opportunity exists when a retailer engages with shoppers online making special, targeted offers in order to obtain more information about their buying habits. Each side of the transaction offers the other valuable data so that down the line the retailer can sell goods that are more in line with the desires of its customer base. If you think these situations smack of consumer empowerment, you're right. The digital consumer is in a position to communicate specific expectations on which a smart retailer or distributor should act.

But crossing the digital divide also means obtaining first-time customers with the help of careful research and data analysis. Sure, social networks gave rise to "friending" and search engines to "googling", but organizations of all stripes are using those same strategies to build their businesses. No longer does a digital business have to be a separate part of your organization. Equipped with the right tools and solutions, an enterprise seamlessly integrates the digital world into its operations.

So the next time you have an online shopping experience that makes you want to "friend" the store's brand, there's a good chance that the retailer is bridging that digital divide - and turning you into a repeat customer.

December 5, 2013

The Largest Enterprise Can Be the Best Start-Up

Posted by Soundararajan S (View Profile | View All Posts) at 9:53 AM

GE's Innovation Czar On Startup Qualities | Beth Comstock | WSJ Startup of the Year [Source: http://www.youtube.com/watch?v=vJRkSnMy-mQ]

Innovation is driving the marketplace like never before. So many of us have come to the conclusion that to build an effective organization, we must all think and act like a 20-something entrepreneur who works out of his parents' garage.

There's no denying that young innovators who are fresh out of college will deliver plenty of market-changing products in the next decade. But what about the rest of us? The lion's share of the global economy consists of people who work at large enterprises with distinct corporate cultures and well-defined hierarchies. Too often we're led to believe that we have to throw off the trappings of the large organization in order to innovate like a start-up.

It turns out that the opposite is true. That is, the young entrepreneur who's looking to build tomorrow's enterprise from a drafty garage should be taking cues from established organizations. That's because every effective (and, ultimately, successful) start-up is the result of the right mix of messy innovation and defined, disciplined business processes.

One of my favorite management experts is a lecturer at Harvard Business School who has rattled conventional wisdom for many years on what constitutes a start-up. Anyone can start a company. You file papers of incorporation with the appropriate government offices and - voila - you're off to the races. But success comes to those enterprises that can remain on the racetrack and keep ahead of the pack.

Those companies that endure have value propositions that come from hard-nosed strategy formation and the ability to work within financial constraints. One of the reasons the best start-ups come from inside large, global enterprises is that management facilitates the innovation process and allows ideas to incubate properly. Plus, there's nothing quite like an established infrastructure to keep everyone on an innovation journey focused.

One of the reasons I'm such a fan of the aforementioned management expert is that he's an advocate of reminding large enterprises that the best innovations can happen within their walls. In fact, that's one of his five recommendations for building an effective start-up. Look t the resources and talent in your current organization for the best ideas. They're probably closer than you think.

Infoscions know that a distinguishing element of our company is that its employees indeed think and act like a nimble start-up even though we do business around the globe. Part of our lasting success has been to redefine current markets and master the new ones that spring out of them. Our recent surveys on digital consumers and ideal stores validate our recipes for success. When an enterprise opens itself up to the expectations of its customer base, it's more adept at charting paths filled with new and exciting possibilities.

The other recommendations in the management primer to which I previously mentioned are just as illuminating. For starters, entrepreneurship is management. All too often, innovators operate their teams under the assumption that the product and the enterprise are one in the same. The product is vital to their mission, but their enterprise depends on the right management skills. They must hone those skills to the tasks at hand, and because the innovation disrupts the market, so too must their management techniques be framed the right way.

Another important element of a start-up is that before it churns out products or solutions it has to teach the people who founded it how to sustain the business. This might seem obvious, but think back to the dot-com boom of the late 1990s. How many entrepreneurs had great ideas only to grow their start-ups out of existence?

That brings up a related idea: accounting. It's important to measure your team's progress and have financial gauges in place. Innovation isn't just a creative process; it's quantitative. Without a system that analyzes and makes sense of your journey, you're leading your team through an uncharted wilderness. Doing so is prohibitively expensive - your teammates can't afford to be reckless.

Perhaps the most useful piece of thought leadership on innovation is that a start-up should be able to "pivot or persevere." That's another reason start-ups within established enterprises tend to do so well: They have systems and processes in place that instantly detect how customers react to their products and services. Successful entrepreneurship starts with a great idea, but it's sustained by the organization that institutes processes that align those ideas with customers.

Just remember: Even if you're a part of an august Fortune 500 company, you can operate like a nimble start-up. No garage is necessary!

December 3, 2013

Why Centers of Innovation Matter

Posted by Upendra Kohli (View Profile | View All Posts) at 8:50 AM

Masdar City Development Full length [Source: http://www.youtube.com/watch?v=3gapNu7D7xU]

I'm watching the development of Masdar City with great interest. This booming scientific community, just outside of the U.A.E. capital of Abu Dhabi, is on its way to becoming another global innovation hub.

What's different about Masdar's innovation story is that it has occurred pretty much overnight. I exaggerate, of course, but not too long ago this hub was a vast stretch of desert. Now it's an ecologically friendly community where alternative energy is at the top of the innovation list. That's quite remarkable given the Gulf's history of providing the world with oil and natural gas. It goes to show you that being successful in one sector doesn't limit you from creating market-moving changes in another.

There's been a cordial debate for the better part of a decade as to what are the ingredients of a successful technology and innovation hub. One side says it's about "nature": These hubs evolve organically over time. Others say it's more about "nurture." With the right planning, vision, location, and funding, anyone can create a world-class hub.

Masdar City definitely falls into the second category. Its success makes a compelling case that innovation hubs can be the creations of joint government and business efforts. But where Masdar differentiates itself from other government initiatives is that it's dedicated to commercially viable enterprises. If these renewable, clean energy innovations and their start-up companies can't make a market for themselves, they're not coddled by a government agency. It's sink or swim.

It helps that Masdar is focused primarily on one industry. You hear a lot about focus in the realm of operations management these days, especially as it pertains to achieving a track record of innovation. Focus on the two or three pursuits that are likely to bring you results. That's important when you consider how private equity firms are more careful with the kinds of companies they're investing in, post-global economic crisis. They're aware of the heightened degree of accountability they must have with their investors.

As such, the innovation journey is more data-driven than ever. Granted, some of the process must be (as a general rule) messy and unpredictable - the sorts of things that a team learns over time. But there's nothing preventing smart entrepreneurs from using all the data at their disposal to make their moves more efficient and more effective. Conserving capital means there will be more of it to go around should your innovation succeeds its initial test phases.

Whether it's an oil-rich nation's laboratories that develop alternative energies for the next century or a graduate student who comes up with new methods of digital communication, entrepreneurs no longer make their innovations in a bubble. They know that beyond seed funding comes the most important test of all: impressing the ever-growing numbers of digitally savvy consumers around the world.

No innovation journey succeeds without accommodating the fact that mobile computing is now the largest platform for technology. There are 10 billion units on the planet and growing every day. And we're not just talking smartphones. Any portable way people can access the Internet - through wearables and connected automobiles, for instance - is up for grabs.

There are several opportunities for enterprises to tap into the growing desire for mobility - and the resulting need to power that phenomenon. The Internet of Things will ensure that everywhere we go and whatever we're doing will involve even partly being connected to the rest of humanity. Innovation journeys that leverage the mobile vision, no matter where their entrepreneurs begin, will be the most formidable forces of change in the society of tomorrow.

That's why, for example, we're already seeing entrepreneurs and scientists who once only thought about fossil fuels now developing renewable energies on the Arabian Peninsula.

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