Innovating along the Business Pyramid

[MarcoCigaina]

In my previous blog I discussed about networks and how they are crucial for innovation management; today I’d like to discuss about pyramids.

Pyramids have been built by civilizations in different parts of the world and charmed not only scholars, but also by many common people for centuries.

Yet pyramids are not only mighty monumental structures: they are also a way of thinking. What does pyramidal thinking mean? It means to look at complex systems at different levels of abstraction and according to different interconnected layers that conceptually build on each other.

Applying pyramidal thinking to a business context, you get the so called business pyramid: a business can be represented in term of vision, mission, strategy, business model, solution portfolio, organization and processes, technology and competencies.

When I started looking at fundamental perspectives on innovation management for established companies, I considered to look at the business pyramid of those companies as one of such key perspectives.

Each layer of the business pyramid constitutes a scope and context for innovation. For example, incremental solution innovation for automotive delineates requirements on assisted-driving and guides the company’s technology innovation, for example in the area of night vision systems.

What is the conceptual consequence for innovation management?

Each layer directly influences the scope and focus of incremental innovation and indirectly influences the scope and focus of incremental innovation for the levels below.

For example, the need for improving a feature of an existing solution (product and/or service) influences the scope of the underlying technology innovation activities.

On the other hand breakthrough innovation derives from an unconstrained, open exploration, a deep understanding of needs and problem re-framing that have the potential to have feedback mechanism towards the upper layers and ultimately change them.

For example, a profound process innovation can challenge and even ultimately change the company’s business model.

What is the practical consequence for innovation management? You can design innovation along the business pyramid:

• Consider all types of innovation along the pyramid – each layer is a possible innovation scope and focus area.
• For each layer (i.e. type of innovation) consider the current situation in your company – it represents the context of your innovation activities.
• Think through the implications of the other layers of the business pyramid on the layer you are considering - e.g. implications of process innovation for business models, or implications of technology innovation for products and services innovation, etc.

The Enterprise and Strategy dimension of the Innovation Management Framework by Global Services Innovation builds on the notion of business pyramid and applies it to the domain of innovation management. And this is another example of how cognitive patterns can be applied to the domain of innovation management and help to provide a structured, comprehensive and consistent set of concepts and practices to enable and foster innovation in companies.

I’ll tell you about another cognitive pattern and its role in looking at fundamental perspectives on innovation management in the next blog. Stay tuned.

Find more blogs from my team and I in the Innovation for the Enterprise Library