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MINDJET PERSPECTIVES
Cultivating Innovation
for Smarter Business

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It seems like everywhere you look, there’s yet another article covering the perks and perils of
innovation. It’s been written about in publications from the New York Times to the Huffington
Post, making it seem like the next big thing is the only thing on the mind of most companies.
All this attention is well-deserved -- innovation isn’t just a core business concept; it’s a race for
competitive advantage. The pace of production has turned the rush to market from a marathon
to a 15-yard dash, and of course, this is not without its drawbacks.
Innovation is closely tied to disruption, full-value thinking, and agile business strategy. Agile is
an attempt to bring process back in balance and restore the priority of innovation to our work,
and companies that do this well know that the best way to facilitate innovation is to remain
steady to the agile process. Agile naturally supports ingenuity through the practice of short
sprints, where testing, learning and iteration -- with a relatively quick turnaround — are so key.
What follows is our collective take on the overall subject: Why disruption can save your business;
why companies sometimes fail to innovate; tips, tricks, traps and pitfalls; and in the end, how
you can inspire innovation and give your business the power to thrive.
Jascha Kaykas-Wolff
Chief Marketing Officer, Mindjet
JASCHA
KAYKAS-WOLFF
Intro

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Right up until the second it’s too late, it’s easy to believe that fighting disruption is a viable
business strategy — especially if you’re the bigger player in the equation. But today’s winner’s
circle doesn’t discriminate when it comes to size or position. We’ve seen disruptive innovations
out-maneuver businesses of every type, completely obliterate entire industries and generate
exorbitant amounts of revenue at breakneck rates.
It’s an intimidating fate for any organization, but nonetheless sealed: take action now, or someone
will do it for you.
The Speedy S-Curve
Every business is familiar with the s-curve cycle. It essentially assumes that after a start-up
phase, a rapid increase in revenue occurs, and is then followed by an eventual decline. Best-
case scenario, successive curves will follow to continue the growth of the business in an upward
direction. History tells us that these cycles take a considerable amount of time to complete, but
like most other areas of business, today’s fast-paced and collaborative world has altered the
norm considerably.
Let’s take cars for example. In 2000, Zipcar’s debut was a pretty radical move in the American
transportation industry. By appealing to native travelers rather than out-of-towners, they
managed to offer a more convenient and cost-effective option than traditional rental agencies. In
2010, RelayRides went a step further with peer-to-peer car sharing, allowing individual owners
to rent out their vehicles on their own pricing terms. What an environmentally friendly solution for
getting someone else to pay off your car.
Plan for Disruption, Save Your Business

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Then again, it’s not all about saving money. Consider how Uber, a 2011 venture-funded start-up,
rattled the longstanding taxicab industry — a service that can be traced back to carriages for
hire in 1640 — by connecting consumers to luxury cars via mobile application. Uber’s prices are
currently twice what conventional cabs charge, and yet the demand is so high that the company
plans to add 25 cities (all outside of the U.S.) to its service list by the close of this year.
While the future of the car industry could always change, one thing is for certain: each offering
decreased the legacy companies’ consumer bases, and instead of seeing successive s-curves, they
are more likely to find themselves at a dead end.
No Exception to the Rule
If you think you might be exempt from this shift, think again. Between 2000 and 2005 the music
industry went from a global marketplace of $40 billion, to $28 billion and digital sales went from
zero to $700 million. That’s major disruption in an enormous marketplace.
Or how about Kodak, Polaroid and Borders, which, despite their popularity, were also nonetheless
affected by digitization. Instead of embracing the movement they attempted to maintain their
normal ways of operating, and in the end completely lost control of distribution, pricing and
marketing. Eventually, each company relegated itself to a specialized and dwindling niche, if not a
complete shuttering.
Wanting to hold tight to what made you successful from the start is understandable, but not
practical and, as you can see, potentially fatal.
Forgiveness is Achievable
TThe good news is that disruption doesn’t have to be one-shot type of deal. Should the path you
choose lead you astray, there’s a good chance you can course correct in time.
When Netflix inflated its pricing model to reflect the switch from discs to streaming, their stock
dropped 20 percent and they lost a whopping 800,000 U.S. subscribers in Q3, 2011. When the
company realized they’d made a mistake, they released the following statement:
Plan for
Disruption,
Save Your
Business
The last few months…have been difficult for shareholders, employees, and most
unfortunately, many members of Netflix. While we dramatically improved our
$7.99 unlimited streaming service by embracing new platforms, simplifying our
user-interface, and more than doubling domestic spending on streaming content
over 2010, we greatly upset many domestic Netflix members with our significant
DVD-related pricing changes, and to a lesser degree, with the proposed-and-now-
cancelled rebranding of our DVD service. In doing so, we’ve hurt our hard-earned
reputation, and stalled our domestic growth. But our long-term streaming opportunity
is as compelling as ever and we are moving forward as quickly as we can to repair
our reputation and return to growth.

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Netflix’s stock, which traded as low as U.S. $63.85 in 2011, rose 80% at the beginning of 2012,
and they currently hold a record number of subscribers. It’s not a complete recovery, and it’s hard to
say how the looming competition (Redbox, Hulu, etc.) will ultimately affect business, but it’s clear
that their apology has been accepted.
Disrupt When You’re Ahead
In light of companies that have been disrupted, failed at disrupting and ultimately been forgiven
for disrupting badly, it makes sense to say the best time to take action is when you’re ahead. With
that mindset, perhaps car rental agencies would have thought of Zipcar’s idea, or Yellow Cab
would have thought of adding luxury and mobile functionality like Uber. Maybe Kodak would have
survived, and maybe Blockbuster wouldn’t have been ousted by Netflix.
CEOs must seek out opportunities for healthy risk taking, but all employees of the 21st century
could benefit from this mentality. A good dose of paranoia goes a long way by keeping us on our
toes, thinking differently and prepared to pivot when need be. It’s this kind of momentum that truly
allows course correction as well as successful business agility.
Plan for
Disruption,
Save Your
Business

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Innovation is a hot topic in business these days — between uproar from industry influencers
claiming it’s dead and speculation that the nature of the word itself is changing, squeezing out the
Next Big Idea is at the top of many a company checklist. Organizations are striving to stay ahead
of industry changes while keeping the creative ball rolling, but navigating the quagmire that is
today’s agile business landscape can leave some companies in a veritable ingenuity vacuum.
Below are 5 ways that companies fail at innovation – we don’t recommend them.
1. They don’t teach managers to ask questions (at least not the right ones)
Natural leaders tend to be tenacious problem-solvers — it’s part of what makes them good at
managing. But there’s a downside to all of that incessant resourcefulness: managers often spend
so much time answering questions that they forget to ask them, or when they do, it’s frequently on
behalf of others. Leaders have a unique opportunity to push innovation through empowering their
teams with food for thought: “ask not what your team can get done, but what your team thinks
should get done.” Or something like that.
2. They like to talk about embracing disruption — someday
Agile business means adaptable business, and that’s not a philosophy that can be employed
piecemeal. Changing up the business model is becoming a necessity, and while most CEOs have
never had to deal with it, disruptive technology is absolutely everywhere — attempting to outrun it
is risky at best.
5 Ways Companies Fail at Innovation

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5 Ways
Companies Fail
at Innovation
3. They can’t get over the honeymoon
Vijay Govindarajan, co-author of The Other Side of Innovation, says “successful companies tend
to fall into three traps that make the glory days fleeting.” One of those is psychological, wherein
companies become so attached to their initial successes that they don’t notice when something
new — or more effective — dislodges their early triumphs. Despite the fact that industry giants
like Dell and Microsoft are guilty of it, fixating on new market impact is a rookie mistake.
4. They cut corners through outsourcing
The practice of outsourcing is likely the business move most hated by in-house employees and
consumers alike, yet the most widely practiced by companies trying to squeeze every last drop out
of their profit margins. In terms of innovation, outsourcing is disastrous: new initiatives can only
be successfully rolled out when independently operated vendors agree on a shared course of action.
Innovation simply can’t survive that kind of roadblock.
5. They don’t think beyond tomorrow (but they pay for it today)
Typically, companies don’t become even marginally successful without some type of long-term
plan, which unfolds alongside initial market testing efforts that support proof of concept.
But in the face of today’s constantly fluctuating technological development, it’s less about
being perpetual and more about being sustainable. Giving away free support and access to
infrastructures, though integral, must be built in to comprehensive financial strategies, lest the
true market cost of conceiving and manufacturing come back to bite you squarely in the bank.

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Innovation is important to business — and increasingly so as market needs have become more
demanding in light of advancements in social, mobile and cloud-based environments. Even the
Enterprise 2.0 Conference, a leading event on all things enterprise-y, this year changed its name
to E2 Innovate in order to reflect these shifts.
But as the need for innovation accelerates, so does a general misunderstanding of how to apply
it. Indeed, “innovation” is becoming a buzzword, and as anyone who’s been hanging out in the
tech industry for just about any amount of time can tell you, that equals foggy misuse and, even
worse, overindulgence.
Innovation Only = Boom Splat
While being ahead of the competition is definitely something you want, focusing all of your
energy on that one ambition risks allowing innovation to be the news itself.
Bruce Levinson, VP of brand strategy at Anthem Worldwide, named a couple of examples in a
recent Fast Company article, including Listerine PocketPaks breath strips. To Listerine’s credit,
it’s true the strips reinvigorated the brand, spread much-needed awareness and birthed a slew
of copycat products; but, with the honeymoon phase long gone, annual sales have dropped from
the initial $175 million to roughly $25 million. What was once a trendy and seemingly promising
product is now considered by many as turn-of-the-century nostalgia.
If Innovation is Your Only Card, Don’t Play It

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Copycat Innovation = Splat Splat
Before we treat copying innovation as a viable business model, let’s consider the sad tale of
Hipstamatic. Sure, Instagram essentially mimicked the digital photography app by providing
various vintage-y filters and immediate gratification, but its creators also managed to leap-frog
the product by tacking on what Hipstamatic had left out: a social element and a much friendlier
price tag. By the time Hipstamatic realized it had to “catch up” it was already too late. Though
they tried, they couldn’t provide anything consumers didn’t already have.
Fast Company recently published a three-part series on the downfall of Hipstamatic (No Filter:
How Hipstamatic Pivoted Into a Flat Spin), but what it boils down to is quite simple.
“For a startup that prides itself on the originality and creativity of its users, Hipstamatic spent
much of 2012 chasing many other companies’ ideas,” writes Austin Carr, before plugging the
following quote from Hipstamatic founder, Lucas Buick: “I can honestly say that there was a lot of
talk about Instagram, Path, and social. Ultimately, that’s what shifted our focus away from who
we really are.”
No Innovation! (But why?)
Clay Christensen, Professor of Business Administration at the Harvard Business School (HBS) and
author of The Innovator’s Dilemma, spoke at 2012’s BoxWorks conference in San Francisco. In his
talk, Christensen dismissed innovation, labeling it a job-killer and even putting the future of HBS
into question. Instead, he argued for the importance of creating a product or service by way of
understanding the job that customers are trying to accomplish.
Christensen used IKEA as an example of a company that by now probably should’ve been
disrupted — except there’s no cost-effective way to copy or improve upon their model. He went
on to explain that this is simply because IKEA entered the scene with a true understanding of the
job their customers want to do: furnish their place that same day. They then optimized their entire
store flow and shopping experience around that one want.
So, what can we learn from all of this? Companies have certainly got to roll with the punches,
and part of that is strategically innovating and changing at a continuous pace. But to Clay’s
point, staying afloat is about keeping tabs on the other basic fundamentals of business: customer
needs, a strong team, a clear vision, etc.
As eBay CEO John Donahue says in this interview with ZDNet,” “The balance of those two things is
what makes it fun and what makes it interesting.”
If Innovation is
Your Only Card,
Don’t Play It
Listerine Pocketpaks were so closely associated with a product form, rather than a
brand equity, that it lacked the authority to sustain a category leadership position.
The brand may have been more successful had it pinned its brand proposition on, say,
Listerine freshness to-go or intimate togetherness or anything other than the product
form itself, which was quickly copied... It’s always best to build equity that elevates
the conversation to emotional benefits, values, and beliefs, rather than a purely
functional one. That’s much harder to copy.

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Innovation isn’t anything new, but the way we embrace and ignite it is. Because agile business
means adaptable business, old-hat approaches have to be put aside in favor of disruptive
techniques, and innovation must be built in to strategic plans tangibly rather than just
conceptually.
At Mindjet, we talk a lot about “working inspired,” which in terms of innovation, means we focus
on the process of translating our creativity into growth. We believe that industry leaders succeed
because they not only come up with great ideas, but are laser-focused on using those sparks of
genius to generate great plans that drive business forward with killer execution.
One such organization is Ekso Bionics, a company dedicated to utilizing cutting-edge technology
and engineering to help people rethink physical limitations. In their mission to do the remarkable,
Ekso uses Mindjet to map business plans, execute strategies, and collaborate with the many
brilliant teams involved in their effort to reimagine exoskeleton technology. We’re honored to be a
part of their mission – check out this video to see how Mindjet and Ekso Bionics teamed up to help
change lives.
In a world where agile is king, innovation is like the royal guard – the last line of defense between
your company’s relinquishing the keys to the castle, or its exponential expansion to the four corners
of the industry. Don’t get left behind.
Want to know more?
After you’ve assembled a stellar team and gotten the innovation process
underway, adding the right technology can help you capture your brilliant
ideas and build on them with your team. There are plenty of options to choose
from, but Mindjet’s software allows you to brainstorm on a global scale,
enabling your team to capture and continually build on creative sessions by
connecting the ideas that spark innovation.
To find out more about how Mindjet can help you turn innovation into action,
visit Conspire, Mindjet’s company blog.

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