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Emerald Group Publishing Limited
Copyright © 2012, Emerald Group Publishing Limited
Article Type: Editor’s letter From: Strategy & Leadership, Volume 40, Issue 2
This issue has two themes: one is revisiting the theory and practical advice of the seminal strategist Michael Porter, and the other is exploring the collaborative approaches that foster effective innovation initiatives – external sourcing of ideas and capabilities, co-creating with customers, design thinking and using digital technologies to create new business models designed for continuous customer interaction. And to link the two themes, Prof. Porter explains why it’s crucial that such innovation serves a corporation’s strategic purpose.
Joan Magretta is uniquely qualified to be our guide to the work of Prof. Porter. Over two decades she has worked closely with him on many publications, starting when she was the strategy editor at Harvard Business Review. Magretta, who gained front-line experience as a consultant at Bain, believes that “too many managers get their Porter second hand and what they usually end up getting is both inadequate and inaccurate.” She shared her insights about Porter in a conversation with two veteran S&L contributing editors, Robert J. Allio and Liam Fahey, that ranges from the theoretical to the nuts and bolts of daily decision making.
Anyone who has ever had the pleasure of listening to Prof. Porter expound to an audience on the art of strategy has likely mulled questions about their business they would like to ask him. Here’s your chance to “listen in” while he answers the questions frequently asked by practitioners who solicit his advice. In her new book, Understanding Michael Porter: The Essential Guide to Competition and Strategy (2011), Magretta, a senior associate at the Institute for Strategy and Competitiveness at Harvard Business School, conducts a lengthy exchange with Professor Porter, which is adapted here for Strategy & Leadership readers.
To deliver our second theme, four articles offer how-to advice on managing collaborative innovation initiatives:
“Digital transformation: opportunities to create new business models” by Saul J. Berman describes how leading companies are learning to transform themselves to compete in the new digital marketplace by rethinking what customers value most and designing operating models to serve them. This internationally-known IBM consultant believes that to create successful new business models, companies need a cohesive plan for integrating the digital and physical components of operations, one focused on two complementary activities: reshaping customer value propositions and using digital technologies for greater customer interaction and collaboration.
“Collaborative innovation as the new imperative – design thinking, value co-creation and the power of ‘pull’” by Professor Brian Leavy offers corporate executives a “masterclass” on how to adopt the revolutionary thinking and practices required to identify and propel the innovation that remains latent in and outside most organizations. More and more, stakeholders of every type – customers, employees, suppliers and strategic allies – seem willing and able to play more active roles in the value creation process, if managers can effectively learn to use the new tools of collaborative engagement: design thinking, value co-creation and the power of “pull.”
“Applying open innovation where your company needs it most” by Strategos consultants Amy Muller, Nate Hutchins and Miguel Cardoso Pinto set out a step-by-step guide for getting started with open innovation that can be customized to match the needs of a specific firm. Their practical approach is to evaluate the output of a company’s current innovation process at each stage of development to consider which open innovation methods will best serve its growth objectives.
“Better growth decisions: early mover, fast follower or late follower?” by innovation guru Stephen Wunker provides insights for companies seeking growth by capturing new markets via innovation. Each of these options requires a different competitive strategy. To evaluate its choices, a business should first reconsider what business it wants to be in. Then it can determine the advantages and drawbacks associated with entering the industry at different times and with the strategic resources it has at its disposal.
Robert M. RandallEditor