Innovation is a strange beast. Most people say innovation is about new technology or bringing new things to the market. Some might think of better processes.
Schumpeter went further and defined it as “The introduction of new goods (…), new methods of production (…), the opening of new markets (…), the conquest of new sources of supply (…) and the carrying out of a new organization of any industry”. (Source: Innovation Zen)
Innovation is about being different
However, what most of the time is missing, is that innovation has something to do about being positively different from your competitors. When every body in your industry is bringing out new products like in the TV set industry or in the PC industry, then this is no innovation. It is just daily business. You have to do it to survive. It’s a rat race.
However, successful innovation is different. Successful innovation is about being different.
Innovation is when you just offer one telephone handset when your competitor offers 118 devices. Innovation is when you update your one phone only once a year a bit and a major overhaul comes every second year while your competitors bring new devices to the market every months. Innovation is when you see your “telephone” not as a device but as an access gate to whole new world. That’s Apple vs. Nokia. By the way Apple spent only a ninth on R&D than Nokia Continue reading Innovation is about being different
Particularly on the web, we see a lot of copies of successful business models. How many clones are there of Groupon? How many competitors and incumbents wanted to copy Amazon in the late 1990s and failed? The core question is: Is it possible to copy a business model? In this post, I will elaborate on this topic.
During a recent interview for a bachelor thesis, I was asked: Under which circumstances is the transfer of a business model e.g. from a different country or from a competitor a useful strategy?
I must admit, I am skeptical about the outright transfer of business models from one firm to another. The reason is very simple. A business model is more than its technical components like your value chain, revenue model, your product etc. The business model also includes soft factors like the value proposition, your values and corporate culture or your core competencies. Remember the definition of core competency: core competencies have to be rare, difficult to copy and valuable.
Many strategists, VCs and purely analytical people think that it is easy to copy a business model. What they forget is that a business model is not just a technocratic combination of components, in fact, humans are involved with their values, cultures and hidden assumptions. You can copy the hard components, but the human aspect of a business model –values, culture, tacit knowledge – is difficult to copy.
Business Model transfer from Start-ups to Start-ups