Strategy & Innovation

Jeff Dyer & Nathan Furr in their HBR blog To Make Money with Digital, Be an Innovator – Not a Strategist mention how Innovation works and strategy does always in the digital world. They give an three types of situations where the strategy has failed and innovation worked.

  1. Replicating what you did before
  2. Build it they will come
  3. Thinking the Sale is a Finish Line

I think as of today a big differentiator between digital and non-digital companies is the legacy and past experience. Even if both these types of companies are in same business the enterprise-customer relationship in the digital world are still evolving. As I mention in my book The Mouse Charmers – Digital Pioneers of India, the new age businesses are being co-created with the customers. Customers are yet to develop tastes and preferences for the digital world. They are also experiencing the new ways of getting products and services at their fingertips for the first time. To begin with they do not know if they would like it or not – it is only after using do they start developing additional needs and requirements. This required companies to work very closely with them – to interact with them. Companies need to do some macro experiments and then fine tune the successful ones at a micro level. So the role of strategy is almost negligible here. What takes centre stage is the experimentation and the ability to be persistent and patient with them.

On the second point I totally agree with the authors. I have come across many startups who are so much in love with their idea that they forget that the business can exist only is someone other than themselves falls in love with their idea, and for that you have to be in touch with this someone and build your product and service for them. You have to constantly ask them if they like what you are building, you have to ask them to test it for you, you have to ask for the staunchest criticism. On the third point, again agree that in the day and age of big data that is yet to be used successfully in a big way, sale is just the beginning of your relationship with your customers. You need to keep them engaged and happy because online it is far easier to loose the customer – the click away is as easy as the click in.

Strategy has an angle of history that does not exist for most digital enterprises – at least not as of now.

Anuradha Goyal