the Problem Solver
Bias for Action
- Companies must initiate new ventures to stay ahead
- “Goldilocks” design allows for rapid innovation
- The organization is part of the design challenge
Innovation is Accelerating; Companies Must Too
The term “bias for action” captures the essence of an organizational culture that prioritizes progress over process. This principle is relevant for companies at the forefront of R&D where a once stable world of sustainable advantage is being transformed into a world of “transient advantage," where the window for experimentation and market exploitation is getting tighter.
To succeed in a world of dynamic and unpredictable competition, companies must continually initiate new ventures that can establish and exploit new advantages. Though individually temporary, a portfolio of new advantages can help companies stay in the lead over the long run.
Companies can no longer expect to find and defend a sustainable advantage that allows them to maintain an unoccupied position on the competitive map. Rather, they must manage a complex, rapidly shifting and multi-dimensional melee where anyone can be disrupted at any time from any direction.
Potential competitors have become increasingly difficult to identify, as they no longer necessarily look like the business we’re working to scale and protect. Who would have guessed that Amazon, a retailer, would take market share from server companies by launching Amazon Web Services? Or that the iconic New York City Yellow Cab—and other taxi companies around the world—would get squeezed by digital apps that connect freelance drivers with passengers. Or that an entire category of point-and-shoot cameras would be decimated by the smartphone?
Companies need to innovate constantly, using new tools and technologies to refresh their existing products, while also launching new products to drive revenue growth. This can be a challenge for businesses that are structured to manage the lifecycle of their existing products to optimize revenue, rather than exploring entirely new technologies and market opportunities and developing them into net-new businesses.
Traditional approaches to innovation and development that are rigid and sequential are of limited value in today’s landscape. R&D organizations need to short-circuit the product development process to get ideas to market faster and drive continuous iterations based on empirical feedback. To avoid getting mired in long deliberations with low amounts of information, venture design prioritizes making rapid and roughly-right decisions in order to reinforce a bias for action. Rather than adhering to a formal, regimented process, they need to be on the lookout for opportunities to move farther, faster.
Activate the Organization
Venture design is a fluid process that requires an equally fluid and organic organizational structure. The two must be compatible and evolve together, as a change in strategy, talent, process or structure will have a ripple effect on the organization.
As a new product is conceived and developed, the management team must simultaneously anticipate the new organization it can become in the process.
As we reflect on how organizations can prioritize progress over process when launching new ventures, it is critical to organize people and processes in a way that fulfills the promise of a strategy. In this way, the organization becomes part of the design challenge. We call this organizational activation.
The organization is a living breathing system and it is important to recognize that a change in one area will impact other areas. Thoughtful, strategic leaders realize that coordination and orchestration are not only critical but must be consistent and continuous. No longer can a powerful department or leader execute singularly on the strategic promise. They must bring the entire organization along—not just to manage change but to participate in co-creating the future together.
Organizations often attempt one of two approaches to drive growth and innovation: either they start by launching something new or becoming something new. Often, neither of these approaches are successful. Rather, companies need to do both at the same time: launch something new, while simultaneously anticipating the new organization the company needs to become in the process. This requires the core design sensibilities of empathy, curiosity, iteration, co-creation and collaboration to pull insights from the customer, as well as to look inward to the employees and the organizational design.
There is no cookie-cutter solution to gaining or maintaining a competitive edge in today’s rapidly changing markets. Instead, companies must design and organize around the changes they wish to see in the products they develop and the organization that will make the products successful.