7 Steps to Become a Destructive Innovator (Part 4)-Learn with Dr. Shunpeita How to Start a Destructive New Business (Shunpeita Tamada's Column-Part 7)

In the previous columns, in order to bring about disruptive innovation, we (1) set a strategy for what type of innovation to bring, and (2) gather members with diverse knowledge and experience in the planning team. I learned that it is better to (3) look for a customer's "non-consumption situation" or "oversatisfaction situation" and (4) create a solution to that situation by doing "correct" brainstorming (see Figure 1). ).

Figure 1 Seven steps to bring about disruptive innovation

This time, let's learn how to choose the right idea for your company from the many ideas that brainstormed.

"Choose" is the strategy

It is neither possible nor wise in terms of management resources to commercialize all the huge number of boulder mixed ideas created by brainstorming. So, "choosing" the "right" idea from hundreds of ideas is a crucial process.

One of the words I learned from Professor Michael Porter while studying at Harvard University is “Strategy is a choice”. "Since management resources are limited, corporate strategy is to decide which option to allocate management resources to (or which one to" decide not to do ")." Organizations that can't do this, no matter how good an idea comes up in a brainstorming session, can't allocate enough resources to it and end up in a "treasure stalemate" or target a seemingly attractive big market. Choose a lasting idea and get lost in the rival Red Ocean and fight a bloody battle.

Is the idea "for whom" destructive?

Destructive innovation for a company is a new product that is said to be a toy because the performance that the good customer emphasizes is too low even if it is shown to the good customer of the company. It was a new service. And that "certain company" can be a rival company or an in-house company. Therefore, innovation can be categorized into four types: (1) disruptive or sustainable for rivals, and (2) disruptive or sustainable for the company (see Figure 2).

Figure 2 Who is that innovation destructive?

Choose ideas that are "sustainable for your company" but "destructive for other companies"!

Let's classify the ideas created by brainstorming into the four types shown in Figure 2. Of these four types of innovation, the one that should be considered with the highest priority is the idea that is "sustainable for the company" but "destructive for other companies" in the upper left of Fig. 2. Such ideas are highly compatible with your company's value standards and business processes, so they are likely to be a high priority within your company and make decisions about investing management resources. And, from the perspective of other companies, it is ideally in the form of disruptive innovation that cannot be easily dealt with.

Some readers may wonder if there is such a convenient innovation, but for example, there is a product called "Meiji The Chocolate" in the Meiji era. It is a product that is sold at convenience stores at about twice the price of other chocolates. In fact, this is a product that can be said to be the culmination of the Meiji era's continued production of chocolate for nearly 100 years. For the Meiji era, "sustainable innovation" has reached the royal road of its own business, which was finally reached by improving the technology together at the cacao farm just below the equator and repeating research and tasting day and night to finely adjust the taste and texture. It is a product of. And its quality has been evaluated to the extent that it won the Awards in the overseas tablet category by the French chocolate lovers club "CCC".

But what if you look at this from famous overseas manufacturers such as Godiva and Linz? The chocolates of these brands, which have shops in high-end department stores and are sold by hiring many clerk, do not cost 500 yen even for simple chocolate bars. Since manufacturing equipment, advertising costs, store rent, and labor costs for clerk have already been incurred, it will be difficult to reduce the cost so easily to compete with "Meiji The Chocolate".

In other words, "Meiji The Chocolate" is an idea that is "sustainable for Meiji (our company)" but "destructive for other companies".

We can find many such "sustainable for our company" but "destructive for other companies" cases around us, such as conveyor belt sushi, book off, my French, and QB House.

For ideas that are "sustainable for your company" and "sustainable for other companies," if your company is larger than your rivals, challenge the competition!

Then, what should we do if the idea is "sustainable for our company" but also "sustainable for other companies" in the lower left of Fig. 2?

The answer is, "If your company is bigger than your rivals, let's challenge the competition!"

As such a case, consider the "high-performance electric vehicle market" that Tesla was ahead of. High-performance electric vehicles were initially thought of as a niche market for the wealthy, eco-conscious, but as global warming is gaining more attention, it is the highest value many customers demand from their vehicles. In addition to speed, acceleration performance, and cruising range, we have begun to emphasize "not emitting carbon dioxide."

Therefore, high-performance sports car makers such as Mercedes-Benz, Audi, Porsche, and Jaguar have launched new electric vehicles one after another in the high-performance electric vehicle market of the 10 million yen to 15 million yen class, and fierce competition has begun. increase. Unlike Tesla, these manufacturers have the manufacturing technology and quality assurance capabilities cultivated over many years of automobile manufacturing, many sales networks and maintenance bases, connections with existing customers, and brand value. Surviving this fierce competition will be large companies that have more management resources and can freely devote them to research and development, design, manufacturing, marketing, and so on.

If this type of innovation idea comes up and your company is bigger than your rivals, it's a good idea to challenge the competition between sustainable innovations.

For ideas that are "destructive to your company" but "sustainable to other companies" ... Wrap your tail and run away!

So what if the brainstorming idea is in the lower right corner of Figure 2, that is, "destructive to your company" but "sustainable to other companies"? In that case, I would recommend, "Reject such an idea. If a rival notices the idea, wrap it around and move to a higher market or think about providing other value to the customer." That is.

For example, let's say you are the owner of Japan Airlines and a low-cost carrier (LCC) has entered the route you are flying on. Japan Airlines, a full-service airline, possesses a variety of aircraft, pilots and maintenance staff who can operate them, and a large number of repair parts for each aircraft, and also provides generous service in business class and first class. Therefore, even if you stand up against the LCC, you will not be able to compete with the cost.

If so, the only way left for Japan Airlines itself is to retain customers with values ​​other than air transportation such as mileage services, or to further enhance various services for business customers and move to higher markets. prize.

Other possible financial means would be to launch a low-cost carrier on its own or buy a low-cost carrier as such by ANA.

How was it?

From the next time onward, I will explain firmly how to realize the last type of four types of innovation, which is "destructive for our company" but "destructive for other companies". ..

looking forward to.

If you would like to study further, please pick up my book "Japanese Innovation Dilemma 2nd Edition: 7 Steps to Become a Destructive Innovator" at a bookstore near you.

⇒ Click here if you want to read the 6th column of Shunpeita Tamada's column "How to start a destructive new business with Dr. Shunpeita".

⇒ Click here if you want to read more about Shunpeita Tamada's column "How to start a destructive new business with Dr. Shunpeita".

⇒To the top of the celebrity column "Ichimitsu Ichizumi" who is active on the front lines of each field

PROFILE

Shunpeita Tamada

Dean, Graduate School of Business Strategy, Institute of Business and Accounting, Kansai Gakuin University, Ph.D. (Academic) (University of Tokyo)

Born in Tokyo in 1966. After graduating from the University of Tokyo, he joined the Ministry of International Trade and Industry (currently the Ministry of Economy, Trade and Industry). He belongs to Professor Michael Porter's seminar at Harvard University Graduate School, where he studies the relationship between competitiveness and strategy, and receives guidance from Professor Clayton Christensen on the management of disruptive innovation. He is a full-time lecturer at the University of Tsukuba and a fellow at the Research Institute of Economy, Trade and Industry before assuming his current position. He has been translated into books such as "Japan's Innovation Dilemma 2nd Edition: 7 Steps to Become a Destructive Innovator" (Shoeisha) and "Industry-Academia Collaboration Innovation-Empirical Analysis by Japanese Patent Data" (Kansai Gakuin University Press). There are long-selling "Innovation Dilemma" (Shoeisha) and "Solutions to Innovation" (Shoeisha).

* This content is the opinion of an independent author who is not directly related to our company. * Please note that the information posted may differ from the latest products, laws, tax systems, etc.