I saw a couple fascinating statistics recently.
First, Fortune Magazine publishes a list every year of the 500 largest public companies. They started publishing the list in 1955. When comparing the 1955 list to the 2014 list, only 61 of the original companies are still on the list. This means that only 12% of the great companies from 1955 are still strong today. American Motors, Collins Radio, Detroit Steel, and Zenith Electronics – all of these companies used to be titans in their industries, and now they’re gone.
Second, a Boston Consulting Group survey showed that innovation is a top-three priority for 77% of companies. Yet other studies show that most innovations fail.
Taken together, these facts show that while innovation is difficult, but it’s also essential. Any company that wants to stay on top must embrace creative destruction. This means that companies need to constantly be thinking about taking apart, reassembling, and improving key aspects of their operations. I remember having a Zenith television when I was a boy. It was great. As a company, Zenith invented the remote control. The Zenith brand still exists today, but it’s owned by LG Electronics. Zenith was an innovator that didn’t innovate enough or on the right things.
When people think about innovation, they may think first about new products. Yes, innovation is about product news. At Berlin, we’re always looking for exciting product news that we can take to our customers. But let me go broader than product innovation. Ask yourself: Are you open to new ideas and suggestions? Do you question the status quo – the way things are done today? Do you proactively uncover new ways to do things? Do you look to other industries for inspiration? Do you embrace and champion change in your team?
These are all ways to think about innovation. Innovation is about improving our processes, our business model, and the tasks we perform every day.