Wednesday, April 27, 2011

"Little Bets" Innovation

I just heard author Peter Sims talk on a business news show about his new book "Little Bets." Little bets, he explains, are a low-risk way to explore and develop new ideas. He maintains that most successful people and businesses in vastly different fields use this basic method of making lots of little bets, rather than bet-your-company, big bets. What caught my attention about this interview was that he was describing one of the common factors my research has uncovered in 100 year old companies. To quote from my presentation at the Forbes Business Leadership Forum earlier this month: "These companies ARE innovative, but they do so in a very interesting way: through constant, small experimentation."

These "old" companies are very aware of their changing external environment and are constantly on the outlook for adaptations they may need to make. These companies are tolerant of (and often encourage) activities "on the margin" - experimentation within the boundaries of the firm's cohesive sense of mission and purpose. When large scale innovation and change are needed, they plan and implement it very carefully based on what they have learned from the "little bets."

Sims says in these "uncertain and rapidly changing times .... little bets must become a way to see what's around the corner, or we risk stagnating." Companies that have survived over 100 years have discovered this is the way to survive throughout the times.

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