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Innovate or Die

April 16, 2014

Be killed by disruption or be the disruptor. The choice is yours.
The classic Business Intelligence disciplines as we know them -- namely, reporting and dashboards -- are not exactly the tools people think of when we talk about innovation. And for most people and organizations out there, I agree.

The TARGIT Decision Suite, when used at its best, fosters continued advancement in the decision process as you continuously improve your KPIs by adjusting your processes and products. That's the theory that we've sold for years, and that's why our customers will continue to use our product for years to come. That's all good, and if we do our job right we have a long range of customers becoming increasingly more effective at performing their operations. But the question is: Will they survive?

The Need for Disruptive Innovation

When the talk turns to innovation, most people think of radical or disruptive innovation. It's something that changes the marketplace and puts competitors under the gun, or even makes their products obsolete. The technological advances we see today are a real catalyst for innovation and are best exemplified by multi-billion dollar buy-ups of small startups. The giants in the technology industry are facing new products and services created by small companies every day. They attract users and threaten their market position.

Fortunately, they have deep pockets, so they can buy those companies. But at some point, even that strategy will fail. The rest of us -- those who don't have billions of dollars to spend on buying the competition -- need to do something else. We need to be the disrupter or adjust our organization with increasing speed to stay in business.

Companies Die Young

The business world is moving faster and faster every year. This makes it dangerous to look at nothing but historical data to try to predict the future. Compare the list of Fortune 500 companies from 1955 to today, and you'll only find 67 companies who have held on to that top 500 ranking. That's 85% that no longer exist, are no longer publically noted, or simply fell from the list. Back then, the life expectancy of a firm to remain in the Fortune 500 was about 75 years. Today it's less than 15 years, and the curve continues to plummet.

In a world where the road from B to C is very likely to be very different than the one they used to get from A to B, it's a problem if a large company is slow to adapt. That means big companies need to spot trends in the market even sooner than their smaller competitors and challengers.

The Solution

I don't have the magic solution for Fortune 500 companies to hang on to their position in the next 20 years, but I know where they should look.

Find something new. In addition to using your Business Intelligence solution to look at your internal data and improve your organization a little by little, it's necessary to monitor your marketplace. Watch your customers, see how they react to the changes you and your competitors make in your products and services. Engage with them and weigh their opinions about your product very highly -- you'll only hear from a fraction of them, but there's a good chance that fraction speaks for all of them.

Use data from outside your organization, and match it up against your own. That's where you'll find the movement in your customers' needs. And that's where you'll be able to become the disruptor.

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