When it comes to creating the next new, innovative business, no one can pick winners – not even the geniuses of Silicon Valley. The evidence for this is overwhelming. At any one time, there are more than 20,000 funded startups here in the San Francisco Bay Area. The big successes we get are from lots and lots of smart people trying small improvements until one of them works. Venture funds are organized around the expectation that the majority of their portfolio firms will fail.
When I’m giving a talk and point out that no one can pick winners, inevitably a hand goes up in the audience and someone asks a version of, “Well, what about Steve Jobs? He was always right.” Sigh.
Let’s look more closely at the track record of this gifted genius and his amazing collaborators who have had such a big impact on how billions of people live their lives every day.
What I learned from my research is that even for a genius, innovation:
Creating new business models is hard. Creating an organization that is continuously creating new business models is extremely hard. The closest I’ve seen is organizations running an Agile Product Development (APD) process. APD focuses on creating a culture and processes that support small, semi-autonomous, high performance teams.
Unfortunately, APD isn’t the answer when it comes to business model innovation. The brightest minds in Agile lay this out well even if they don’t say the words “business model innovation” when they talk about where APD has challenges: