Possible: A Guide for Innovation

This insight led to the first rule: That way, the founders and investors could specify the precise skills and expertise the CEO would need to scale the business. Techstars, a top-ranked accelerator with 18 programs around the world, also uses simple rules to help start-ups get off the ground. The program in Chicago, for example, insists that portfolio companies can have only five key performance metrics at any point. These measures shift over time as companies develop, but the hard cap on five forces a ruthless prioritization at every step in the process.

Innovation is rarely the product of lone inventors. Communal innovation entails a deep conflict, however. By freely sharing ideas, members of an ecosystem can collectively create more value through innovation.

Use innovation to grow your business

Yet the open exchange of ideas can make it harder to protect intellectual property and potentially dampens incentives to innovate. Consider the case of magicians, for whom secrecy is everything.

• What simple rules are (and aren’t).
• The simple rules of disciplined innovation!
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• Simple rules to select innovations!

Even more worryingly, if the public learns how tricks are performed, the illusion is ruined for the audience. Magicians cannot rely on the law to protect their intellectual property—they would have to reveal the details of a trick to patent or copyright it. Instead, magicians rely on simple rules. The rule prohibiting the use of a trick that has not been widely shared, published, or sold to you protects magicians who want to keep their magic proprietary. Simple rules are common in communities including those of chefs, stand-up comedians, and crowdsourcing that rely on innovation but do not or cannot use the law to protect their intellectual property.

Sometimes innovation requires working with partners, and simple rules can help here too. The production of cement, the critical ingredient in concrete, is the third-largest source of greenhouse carbon dioxide.

After Primekss won a construction-industry innovation award, the founder was approached by over contractors, but he estimated that the company could evaluate, train, and support only a few new relationships every year. To select partners, the company developed a set of simple rules.

Instead of putting new partners into head-to-head competition with existing ones, Primekss decided to select them in geographic markets with no current operations. A second rule was that a potential partner should have a Laser Screed machine, a state-of-the-art concrete-spreading system that signaled technical sophistication and commitment to quality.

Another rule—partners must sell the concrete within three months of signing a contract with Primekss—ensured that the relationship would be a high priority for partners. In the first year after implementing these principles, Primekss doubled its rate of new partnerships that succeeded and quadrupled its licensing exports. Too much constraint can stifle innovation, but too little is just as bad. A blank sheet of paper sounds nice in theory. In practice, pursuing novelty without guidelines can overwhelm people with options, engender waste, and prevent the coordination required for collective innovation.

Simple rules can inject discipline into the process by providing a threshold level of guidance, while leaving ample room for creativity and initiative. McKinsey uses cookies to improve site functionality, provide you with a better browsing experience, and to enable our partners to advertise to you. Detailed information on the use of cookies on this Site, and how you can decline them, is provided in our cookie policy.

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Search Toggle search field. Toggle search field Toggle search field. The simple rules of disciplined innovation. Sidebar Pitfalls to avoid when making rules Dictating rules from the top. Simple rules are most effective when they are created by the people who will use them. Letting the users make the rules helps you draw on their firsthand experience and increases their level of buy-in. The successful exploitation of new ideas is crucial to a business being able to improve its processes, bring new and improved products and services to market, increase its efficiency and, most importantly, improve its profitability.

Marketplaces - whether local, regional, national or global - are becoming highly competitive. Competition has increased as a result of wider access to new technologies and the increased trading and knowledge-sharing opportunities offered by the Internet. This guide explains how you can make innovation a key business process and outlines the different approaches you can take.

It gives you advice on planning for innovation and creating the right business environment to develop your ideas. It also outlines the help and support available to innovative businesses. It is important to be clear about the difference between invention and innovation. Invention is a new idea. Innovation is the commercial application and successful exploitation of the idea. Fundamentally, innovation means introducing something new into your business. Innovation can mean a single major breakthrough — e. However, it can also be a series of small, incremental changes.

Whatever form it takes, innovation is a creative process.

The simple rules of disciplined innovation | McKinsey

The ideas may come from:. Success comes from filtering those ideas, identifying those that the business will focus on and applying resources to exploit them. Innovation in your business can mean introducing new or improved products, services or processes. There's no point considering innovation in a vacuum. To move your business forward, study your marketplace and understand how innovation can add value to your customers.

For more information on analysing your marketplace, see the page in this guide on planning innovation. You can identify opportunities for innovation by adapting your product or service to the way your marketplace is changing. For example, if you're a specialist hamburger manufacturer, you might consider lowering the fat content in your burgers to appeal to the health-conscious consumer. You could also develop your business by identifying a completely new product. For example, you could start producing vegetarian as well as meat burgers.

You could innovate by introducing new technology, techniques or working practices - perhaps using better processes to give a more consistent quality of product. If research shows people have less time to go to the stores, you could overhaul your distribution processes, offering customers a home-delivery service, possibly tied in with online and telephone ordering.

If your main competitor's products have a reputation for being cheap and cheerful, rather than trying to undercut them on price you could innovate by revamping your marketing to emphasise the quality of your merchandise - and consider charging a premium for them. Then work from there. People are always surprised by how much they are able to accomplish in three to four minutes. Just getting things out from the inside doesn't take a lot. An important distinction Schonthal makes, however, is that he believes the best use of brainstorming is to set a general direction or vector for design, not that it will yield the "final" billion-dollar idea right there and then.

Once your team has identified a concept to pursue, it is tempting to devote a lot of time to refining it before showing it to others. But that may not be the most effective course of action, Schonthal says. But will enough face-plants make potential customers wary of your creations?

Change Up Your Brainstorming Sessions

Not necessarily, as long as you are up-front about the fact that you are showing them products in beta. I just want to see your reaction to it,'" Schonthal points out. They slap the word 'beta' right there on the masthead, so you know that you're taking a risk in trying something that's maybe a little bit ahead of its time. If you are launching in beta, you are accepting the fact that you will need to iterate--protoyping, testing, analyzing, and refining your product.

They look at iteration as a very linear progression: But the reality is, it's totally messy.