Innovation Through Renovation

Here is this month’s piece from Brand Velocity, an Atlanta-based consulting firm that is putting Peter Drucker’s ideas into practice at major corporations.

Peter Drucker placed a high priority on innovation as an essential source—if not the essential source—of organizational sustainability. Yet many of today’s innovators use concepts such as “thinking outside the box” and “beginning with a clean sheet of paper” as proxies for being truly innovative.

Recently, in a discussion with the president of a large financial services company, the subject of innovation came up. “Over the years, I’ve been to a lot of offsite sessions, where we have gone through the very inspirational exercises of starting from a clean sheet,” he told me. “Here’s the problem. We aren’t starting over. We have a legacy of customers and relationships that have been built over the many decades. Every established company needs to innovate. But no established company can start over.”

During this discussion, I thought that I might be listening to Drucker—without the charming Viennese accent.

Our company has had the privilege of working with major companies on large reinvention projects for many years. In our experience, Drucker’s wisdom has come through time and time again: Most successful corporations that we’ve worked with have addressed innovation through renovation, not building from scratch.

Drucker made innovation, as he so often did with complex subjects, deceptively simple. In his own way, he observed that we must answer three questions simultaneously: First, what do we need to stop doing? This is the “trimming the tree” so that it can grow fuller. Second, what are we doing successfully that we can build upon? Drucker was all about building upon your strengths—whether as an individual or as an organization. And third, what should we start doing that we are currently not?

This third question is where most innovation consultants start—and stop. This question is the most fun to tackle. Yet it is typically the least practical part of innovating in established companies. It’s important, but only in conjunction with stopping those things that are not working and building upon what already is.

That’s why the most innovative companies I know have continually focused on evolution to achieve revolution over time.

— Jack Bergstrand