Harvard Business Publishing

About two months ago, a colleague convinced me to sign up for Verified Identity Pass' Clear service. I dutifully filled in the forms, had the company capture my fingerprints and take pictures of my iris, forked over a couple hundred bucks, and received my Clear pass in the mail. I wouldn't quite say the Clear card changed my life, but the next couple months of travel (at airports that had special Clear lines) were a breeze. I made at least one flight because of Clear. I started recommending the service to my colleagues. Then, last week, a sad email arrived in my inbox: "At 11:00 p.m. PST today, Clear will cease operations. Clear's parent company, Verified Identity Pass, Inc. has been unable to negotiate an agreement with its senior creditor to continue operations." I'm honestly not all that surprised at this outcome. Clear was a beautiful technological solution. The... Keep Reading »

Over the past decade, Google has inspired envy in trench-dwelling managers around the world. It's not just the unparalleled benefits. It's the way Google approaches innovation. Engineers are encouraged to dream up pet projects in their spare time. Teams self form around the best ideas. Market-based principles ensure that the best ideas receive funding. It sounds chaotic, democratic...and intoxicating. "Why can't we do that?" countless managers wonder. "Instead, we have to deal with crushing bureaucracy that favors our leaders' personal whims over the most game-changing ideas." Management guru Gary Hamel praised Google in his book The Future of Management, positing that more and more companies would adopt the company's market-based system. There is indeed much to admire about Google's approach, and much to learn from it. The system ensures that interesting ideas — even those that aren't obvious fits for Google's capabilities or core business model — receive some degree... Keep Reading »

Companies that fall prey to disruptive attacks aren't stupid. They aren't lazy. They aren't bad operators. In fact, the root of the innovator's dilemma is deep competency. Smart executives fine-tune their approaches to wring out as much profit as possible. But, this optimization process blinds them to strategic shifts that take place at the fringes of the market. Typically, a small upstart begins the strategic shift. But today's pharmaceutical industry features a $40-billion company driving a striking strategy shift instead. For decades, large pharmaceutical companies have focused on a single question: how do we come up with drugs that target the most prevalent conditions? Mergers and acquisitions have created corporate behemoths that require these "blockbuster" drugs to move the needle — drugs that address common conditions like cancer, high blood pressure, Alzheimer's and so on. But Novartis is inverting this strategy. Instead of trying to create drugs that target the... Keep Reading »

A central tenet in The Silver Lining is that the tough times today are actually a hidden boon for innovation — scarcity will drive discipline, forcing innovators to focus on critical assumptions and make quick decisions. One organization that is trying to live these principles is Y Combinator. For those who haven't heard about it, the company was founded in 2005 by Paul Graham, who sold a startup venture to Yahoo in 1998 for about $50 million. In just a few years, Y Combinator has funded 150 different software and Web services startups. Well known Web 2.0 companies Scribd, Xobni, and Loopt are Y Combinator alums, and me-too funds are springing up across the United States. Sequoia Capital invested $2 million in the business earlier this year. Y Combinator's basic approach is to give promising ideas a small amount of seed capital (the average investment is less than $25,000), then... Keep Reading »

It's tough out there, but companies that think their choice is to innovate or to survive are missing the point. Innovation is a corporate necessity, not a nicety. There's little doubt that innovation is going to become harder as resources become tighter and competition becomes fiercer. But, those companies that continue to focus on innovation have a rare chance to create substantial space between themselves and their competitors — those that don't will fall further and further behind. The Silver Lining: An Innovation Playbook for Uncertain Times makes the case that today's turbulent times make mastering innovation a competitive necessity. The book aims to provide corporate innovators and entrepreneurs with practical guidance to seize the ample opportunities that still exist in today's markets. The following 10-point checklist synthesizes The Silver Lining's key messages and provides practical guidance for leaders looking to realize opportunities in their markets. Each item links to... Keep Reading »

This article is the final installment of a 10-part series highlighting what companies need to do to transform uncertainty into opportunity. The full list will be posted on HarvardBusiness.org and SilverLiningPlaybook.com. The Silver Lining is available now. 10. Does your organization have a plan to help leaders transform themselves? Einstein once defined insanity as doing the same thing and expecting different results. Managers hoping to transform their businesses have to start by transforming themselves. They have to build the capability to confidently confront the paradoxes they will increasingly encounter. Unfortunately, most research shows that few leaders have developed the capability to deal with paradox. Why? Historically, success hasn't required it. Fortunately, management can follow a range of strategies to begin to drive the personal reinvention that must precede corporate reinvention. For example, a manager at a Fortune 100 company who heads up new business development activities launched an online business... Keep Reading »

This article is part of a 10-part series highlighting what companies need to do to transform uncertainty into opportunity. The full list will be posted on HarvardBusiness.org and SilverLiningPlaybook.com. The Silver Lining is available now. 9. Does your organization have systems and structures to make innovation repeatable? There is a long held view that innovation is random. Because innovation is unpredictable, the best a company can do is to identify important innovations early and react appropriately. But decades of research and applied work has brought great clarity to the world of innovation. While we're still far from perfect predictability, companies that manage innovation like a process can sharply boost the returns on their investment in innovation. One example of a company that has built an "innovation factory" is Procter & Gamble. The company follows a very structured approach to innovation. At the heart of its effort is an obsessive focus... Keep Reading »

This article is part of a 10-part series highlighting what companies need to do to transform uncertainty into opportunity. The full list will be posted on HarvardBusiness.org and SilverLiningPlaybook.com. The Silver Lining is available now. 8. Does your organization have a plan to "love the low end" in existing and emerging markets? Customers in established markets are becoming increasingly value conscious. Competitors are growing increasingly fierce. Eighty percent of the world's population and 40 percent of the world's economy (adjusting for purchasing power parity) constitutes just 10 percent of revenues for S&P 500 companies. Companies around the world have to figure out ways to love the low end, or they will fail to deflect looming threats and miss promising growth opportunities. Loving the low-end requires doing more than stripping out features and costs. It requires that companies build business models that deliver what low-end customers value. Start by identifying market... Keep Reading »

While it is far too early to say that the skies have parted, it at least feels like the ground isn't shaking as much as it was in late 2008. Companies are generally turning from asking, "What surprise is coming next?" to "What do we need to do differently to thrive in today's tough times?" One thing that almost all large, established companies need to do differently is compete in emerging markets. Want proof? Eighty percent of the world's population and 40 percent of the world's economy (adjusting for purchasing power parity) constitutes just 10 percent of revenues for S&P 500 companies. University of Michigan Professor C.K. Prahalad has long urged companies to tap into the fortune at the bottom of the world's economy pyramid. What once was a strategic nicety is increasingly a competitive necessity. Companies that don't find ways to love low-income markets will struggle to meet growth... Keep Reading »

This article is part of a 10-part series highlighting what companies need to do to transform uncertainty into opportunity. The full list will be posted on HarvardBusiness.org and SilverLiningPlaybook.com. The Silver Lining launches June 1. 7. Does your organization constantly seek to share the innovation load to de-risk innovation? In the early 1980s, Bob Reiss had an insight: if he moved quickly, he could capture an opportunity in the then-emerging trivia game market. He invested $50,000 of his own money, and formed relationships with a range of individuals and companies. A friend invented the game for him. TV Guide helped to create trivia questions and brand the game. Swiss Colony helped with warehousing. A specialist helped ensure Reiss collected from slow-paying retailers. In the end, Reiss parlayed his $50,000 investment into a cool $2 million — and all of his partners profited nicely as well. People often think of entrepreneurs... Keep Reading »