What are the reasons why the Incumbents are unable to innovate and regain sales success?
.
One of the reasons is the existence, within them, of an Immune System that prevents them from innovating. <see also Why the big companies cannot innovate within them [1] >
.
Keep in mind that this Immune System does not operate against the Company (preventing it from creating attractive products for the new market) due to an accident, but it was set up in this way precisely to protect the Company.
The problem with this system is that it was born to work in other times, in which it performed an effective job.
It is as if in a phase of the life of a living organism (for example a baby of a few months) there was a defense system set up to protect the organism in that specific phase of life (in the case of the newborn, to bring it to refuse food that it is not yet able to digest). And then this approach continued to operate in adulthood: it would be a disaster for the life of the adult, forced to eat baby food for life.
.
The Immune System in question allowed the Companies to earn a lot of money in the Market phase of linear product evolution. A phase in which, to be successful, it was necessary to focus on sales. And in which any activity other than the development of sales strategies were actually dangerous distractions (which risked the Company failing).
.
The Immune System was not set up in a fully conscious way: it is the result of the continuous action of the Managers, who in creating the organizational structures, in setting the company Mindset (choice of people, training) have always tried to do in so that everyone always kept the focus on sales strategies (and did not “waste time” in developing ideas for improvement, which are always expensive, long to put into practice, and results that are not at all safe).
The result of this action was, in fact, perfectly functional to the health of the Company (in the market phases preceding the current one).
.
The problem created today by this Immune System is obvious: assuming that in the Company there is a person capable of developing new winning products, the top Managers do not have the same quality, and therefore they will never have the intention to support it. This is the idea of a radically new product: how it is possible that the Manager – trained for years to see only sales methods that do not deal with the actual capacity of the product to satisfy real Customer needs – is able to distinguish, between the many ideas that come to him, which are failures and which are winners?
The unique thought of non-disrutpive-innovation
The problem is exacerbated by the fact that it is a widespread Immune System (Salim Ismail rightly defines the collective Immune System: https://medium.com/@salimismail/overcome-internal-resistance- to-exponential-growth-30167ea12426)
That is, the big companies live in a sort of single thought typical of ideologies (that is, when there is a condition in which ideas are pursued that are not tied to actual reality). It is therefore in a mindset in which “everyone thinks like me”: Managers, Consultants, Professors, Journalists. And so it feels safe.
Furthermore, there are cases in which “the Intellectuals”, to please the Incumbents, begin to denigrate disruptive innovation with forms of negativity and twisted reasoning developed on an emotional level.
One of the most significant cases of this culture is the article “The Disruption Machine” (NewYorker, June 23, 2014) by Jill Lepore, in which the author identifies Disruptive innovation with “the rhetoric of disruption – a language of panic, fear, asymmetry, and disorder “; and as “competitive strategy for an age seized by terror.” <see on my Article “The basic misunderstanding on Real (Disruptive) Innovation“>
.
.
To develop a real disruptive innovation it would be necessary to radically change the structure and mindset of a company.
But this is not possible for a Big Company: any element of innovation brought within the Company (new people, change of the organization, etc.) would be attacked, and neutralized, by its Immune System.
.
Keep in mind that it would still be a matter of operating in a practically impossible condition: the usual problem of “changing a wheel while the car is moving” .
That is, the big Company should still continue – while making a radical change to it – to make profits with the traditional business (and in addition a Big Company must also account for the strategies to the shareholders who reason in terms of immediate revenue).
.
