How Successful Companies Keep Innovating | Art Of Innovation
Do you ever wonder how successful companies like Google and Amazon keep inventing new things? What is the art of innovation Or How innovation in technology sector mostly comes from particular places like silicon valley? What is the secret behind this?
Innovation At Google
Google is probably the world’s most successful company. So, would you believe if I tell you most of the Google products are developed from the personal projects done by the Google employees? Let’s find out how big companies like Google are able to create such a creative environment.
Google allows it’s employee’s to spend 20 percent of their time on the projects of personal interest. Something like a pet project or a side project. Many of the great products of Google are developed from these personal projects of employees. For example, google news, a guy from India named Krishna Bharat developed it from his pet project. Let us explore more about the working culture of innovative organizations like Google.
Innovation at Successful Companies
Successful companies have a simple motto Bring the inventors together and do not come in their way. Companies try to build a Creative Environment. Do you ever notice how some places are so artistic and innovative? How a particular innovation in art or in technology comes from a few selected locations. For example the development of arts and literature in Florence at the beginning of the fifteenth century, Development of poetry and literature in Bloomsbury of London, Development of computers and tech startups in Silicon Valley of California. Software development in Bengaluru of India. These are the few examples of many. This shows us that innovation is most likely to happen when creative people come together and get enough help and resources either from the government or from the organization they are working for.
Innovative Companies do not interrupt or discourage their employees when they try to do something new. For Example, when your employees are trying to create something new and in that process, if they commit some mistakes you should not behave harshly with them. If you scold employees for committing mistakes, they will not dare to do anything new.
Innovation Happens in the Chaos
Great inventors believe that innovation happens in the chaos means innovation happens where there is no discipline at all. For example, if you read the facebook effect a book on how Mark Zuckerburg started facebook and how he built facebook? You will find out, in the early days of facebook there was no discipline at all at the company. Engineers used to code day and night at any time they want, sit anywhere they want. But when companies grow bigger they have more responsibilities. At that time they need to organize their working culture. Therefore, companies hire managers to organize the working culture.
The Innovation Process at the companies
Creativity in chaos then the managers and then things get in order. That is how successful companies keep their working culture balanced where creativity and responsibility both have equal importance.
The second thing is companies design a basic structure of process inside the respective departments of companies for the innovation in their product, service, and process. They always have six goals. Let us see them one by one
- Product innovation – It refers to introducing a new product. For example, Amazon Echo, Amazon’s fire tv stick and Amazon’s kindle.
- Product improvement – It aims to enhance the performance and reduce the cost of products. Here is an amazing example of product improvement –
Example Innovation at Boeing
The Boeing 737 is the bestselling commercial jet of the modern world with more than 7400 Boeing delivered to the customers. Now see these photos on your left that model is from the 1970s on your right this the current model.
The look of Boeing 737 has hardly changed yet Boeing has been improving it in terms of fuel consumption, pollution control, noise level reduction, and many other things. More than 3.5 lakh components were involved in building a first Boeing 737 and in last 40 years. Boeing has replaced almost all of those components with the new advanced components. We do not notice these improvements yet these improvements outperform the old models in every aspect.
- The service innovation – It includes introducing new services to your customers like the invention of atm machines by banks. Google maps by google.
Now imagine, once upon a time insurance companies largely sold face to face but now you can buy insurance online. So, see the approach has largely been changed and successful companies always keep up with it.
- The service improvement- the first atm machine was installed in 1967 in north London. Now atm machines are everywhere you can even deposit money through these new atm machines so that is what we call service improvement.
- Process innovation – It aims to find a new effective way to develop your product in order to reduce the cost and time.
- Process improvement is often related to reducing cost, improving performance and at the same time Increasing the volume of production.
There was a time when a small team of people used to make the entire car but now modern factories use both automation and humans. Car companies need humans when they want to invent or introduce a new model of the car once the first model of the new car is designed then most of the process is done via automation. After designing the first model of a car, companies use automation for Mass production.
Business Model of Successful Companies
Business models of successful companies are always a good combination of product, service, and process. They build a great ecosystem around these three.
For Example, Amazon has invested a great deal in designing an ecosystem for buying books.
- They have amazon dot com where you can buy books and they manufacture amazon kindle as well. An eBook reader where you can read those books and it is the most preferred device for reading books so far.
- Then Amazon bought Goodreads, a social catalog of books that allows you to search the whole database of books, review those books and also it lets you create your digital bookshelf.
- Then amazon precisely connected all these things with one another. They made a great ecosystem of buying selling reviewing and finding the books and now they don’t have any competition in that market.
Users buy books on amazon they read it on kindle then they review that book as well as find new books on good reads. Isn’t that amazing model amazon have?
Companies cannot always invent everything.
There will always be some bright engineers in the world, who prefer working independently rather than working for companies like amazon or google. So then, these companies use the other way and that is acquiring new companies.
- For example, In the case of Amazon’s ecosystem of book, amazon was not the one who founded good reads amazon acquired it and integrated into their own ecosystem.
- In another case, Google has been very keen to develop artificial intelligence. That is why Google has their own department working on artificial intelligence as well as the acquisition department which keeps an eye on startups related to artificial intelligence and If those startups can contribute to google’s service google acquires them at any cost.
keeping your company innovative is a great deal.
On the one hand, The rival companies fight for existing customers in the existing market. On the other hand, someone could be working to introduce a completely new technology or a product, which could disrupt your industry and eventually replace you in the near future. Just like how once google replaced yahoo and now electric cars are disrupting automobile industry. The battles between rival companies are important but companies also need to keep watch on new disruptive inventions.
Therefore, big companies always try to hire smart engineers from around the world as well as they try to acquire new innovative startups but when you are at the beginning of building your own startup you need a great amount of knowledge and knowledge comes from books. So check out the amazing range of books mentioned in the description of my videos.