Each day is different, and yet the same. Change is frequent, but typically occurs within a familiar world. Sometimes more radical, and other times it’s incremental. The result is a constant stream of opportunities, requiring organizations to build on the past and create the future.
Evidence suggests that the rate of change is accelerating in the contemporary world, driven by resource scarcity, environmental impacts, population growth, especially in cities, plus major discoveries in science and technology. The scope of change and opportunity continues to expand. For all these reasons, innovation is more important than ever. On the one hand, we need to find solutions for urgent global problems; and on the other hand, there are new opportunities to create value for customers and society.
Surprisingly, this also implies greater attention to the past. Because even the most radical innovation builds upon what already exists. Innovation always imitates to some degree, enhancing and expanding on prior knowledge. Nothing is ever completely new. It therefore follows that extreme innovation requires extreme imitation, that is, a deep and strategic understanding of existing products and services, and how they meet or miss the needs and wants of customers.
Organizations struggle to master these contrasting capabilities. They must be thoroughly grounded in the present, assessing current solutions, able to imitate and copy strategically; while at the same time exploring the future, looking for ways to innovate beyond the present, potentially disrupting existing markets and solutions.
This is the dilemma of innovation: how to exploit the present while exploring the future, integrating both complementary activities. Few organizations do this well. Most become captive to the here and now, exploiting rather than exploring. But some get it right. They learn how to leverage imitation for innovation, and how to optimize existing knowledge and resources for future value creation.
In contrast, some organizations separate innovation from the existing business, turning the past and future into opposites or opponents. A clear benefit of the alternative approach is that it exploits the value and insight of existing knowledge and resources. It does not relegate exploitative skills and capabilities to second class. People can feel proud and empowered to bring imitative ideas into the mix. They help to connect the past, present and future. As a first step, leaders should recognize the power of strategic imitation within the process of innovation, and build teams and systems which allow this to happen.
Peter is the Assistant Professor of Entrepreneurship at the Madrid based IE Business School. He writes about innovation, and his work has been featured in leading academic journals and international publications including the Harvard Business Review and The Economist. Previously, Peter held executive positions in the airline, banking, software start-up, consulting and venture capital industries.