what it means to leaders and their teams
Lead and Disrupt
The well-known ‘Innovator’s Dilemma’ has claimed quite a few famous scalps. Nokia, Blackberry, Kodak and Blockbuster all floundered under the pressure of trying to lead in their existing markets, while simultaneously disrupting their way into new ones. Lead and Disrupt reveals how other firms – IBM, Amazon, USA Today, Wal-Mart, and others - successfully beat the odds to do both things well. IBM pivoted into business even as it maintained its hardware business; Amazon shifted to platform services while keeping their leadership in books, USA Today was an early winner in online news and kept a strong print presence. There is discernible pattern to their successes - we call it ‘ambidextrous leadership’ - playing the “Core” game and the “Explore” game side-by-side within the same firm. Lead and Disrupt outlines how leaders and their teams can adopt ambidexterity to enable breakthrough innovation without jeopardizing the current core business.
why are some new businesses so much harder to build than others
Why do firms that are world-famous for innovation - like Nokia – succeed for so long then fail spectacularly when a phenomenon such as smart phones shifts the market? Conventional wisdom says these firms ‘didn’t see it coming.’ Our research suggests that this is most often not the case. Nokia had its own version of a touch-screen smart phone. Polaroid had the world’s most advanced digital camera in the mid-1990s. The potential was clearly there, but was not seized. These companies could not make the high-stakes moves needed to win in the new world around them because there was something fundamentally competence-destroying about change. Lead and Disrupt offers a framework for understanding which innovations have the potential to sink the ship, and how to manage them so that they don’t.
how to build new businesses in established organizations
We compare how IBM, Cisco, and Cypress Semiconductor set up innovation ventures and generated organic growth in fundamentally new areas. Launched in 2000, IBM’s ‘Emerging Business Opportunities,’ for example, came to account for 26% of the company’s revenues by 2008. This is a phenomenal shift; Lead and Disrupt illustrates in detail the mechanisms IBM and others used to select, fund, resource and manage new emerging business programs. We also show how leadership decisions can scuttle even the most strategically sound of new ventures.
creating Ambidextrous Units
We demonstrate how to scale a new innovation into a fully-fledged unit by developing repeatable ‘ambidextrous’ leadership practices for protecting and scaling start-ups. Thisenables the innovation unit to operate under its own rules, separate from the Core business, while also having access to resources from the mother ship. When a senior leadership manages this structure successfully, our research shows that it yields substantially better returns than ‘spinning-out’ the innovation to a separate unit. Using examples from companies like IBM, Ciba Vision, Analog Devices, Amazon and others we share the key ingredients for effectively managing ambidexterity and implementing the changes needed for success.
what CEOs and Senior teams need to do
Leadership is pivotal to Ambidexterity. It’s the senior team that manages the trade-offs between Core and Explore; ensuring new growth has the resources it needs to be successful, without sacrificing today’s cash generation. Devolving responsibility for these trade-offs lower into the organization typically means innovation goes unfunded. We distinguish different strategies that leaders can adopt for engaging senior teams and introduce cases from Misys, BT and USA Today to illustrate how they work in practice.
Making the leap
how to transform to become ambidextrous
Embracing ambidexterity is central to a firm’s long-term survival at key inflection points in its history. Ambidexterity is a mindset, it is a set of disciplines and leadership practices, and it is a series of well-researched practices that have worked and not worked at different firms. Ambidexterity requires tough decisions balancing present and future, resource trade-offs, and leadership dialogues that lead to a fundamental shift. These are transformational moments for many firms, involving a fundamental shift in products, skills, practices and, vitally, culture. IBM, Haier, and Zensar successfully managed the deep waters of renewing their organization at least at one point in their history. Lead and Disruptdetails what they did and how it can be replicated by others.