The document discusses the cost of not innovating for businesses. It notes that failure to innovate can lead to a business being overtaken by more innovative competitors and becoming obsolete. It provides examples of companies like Yell, Borders, and Blockbuster that failed to innovate and were disrupted. Additionally, it finds that of the Fortune 500 companies in 1955, only 13% remained on the 2011 list, meaning 87% failed due to issues like not innovating.

1. The Cost of NOT Innovating
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The Cost of NOT Innovating
Facilitated by
Daniel Feiman, MBA, CMC®

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What is the Cost of Not Innovating? Unnovation
Unnovation is the refusal to identify, create, embrace,
explore, develop or adopt new ideas, opportunities,
products, processes or ways of doing business that
results in the unnecessary and un-timely end to a
business because it is eventually overtaken by market-
savvy competitors.

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Who failed to innovate?
• Yell was disrupted by Google;
• Borders by Amazon;
• Blockbuster Video by Netflix
• And…

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Note

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• Fifty years ago, “milking the cash cow” could go on
for many decades. Today, globalization and the shift
in power in the marketplace from buyer to seller is
dramatically shortening the life expectancy of firms
that are merely milking their cash cows. 50 years
ago, the life expectancy of a firm in the Fortune 500
was approximately 75 years. In today’s world it’s
less than 15 years and declining even further.

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Fortune 500 Firms in 1955 vs. 2011; 87% Are
Gone
What do the companies in these three groups have in
common?
Group A. American Motors, Studebaker, Detroit Steel, Maytag
and National Sugar Refining.
Group B. Boeing, Campbell Soup, Deere, IBM and Whirlpool.
Group C. Cisco, eBay, McDonald's, Microsoft and Yahoo.

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Comparing the Fortune 500 companies in 1955 and
2011, there are only 67 companies that appear in both
lists. In other words, only 13.4% of the Fortune 500
companies in 1955 were still on the list 56 years later
in 2011, and almost 87% of the companies have either
gone bankrupt, merged, gone private, or still exist but
have fallen from the top Fortune 500 companies
(ranked by gross revenue).

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10. The Cost of NOT Innovating
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Which means…?

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Pre-active vs. proactive vs. reactive
Swim Sink

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They saw it…

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If you are not moving ahead…you
are falling behind!

15. The Cost of NOT Innovating
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Contacting us:
Daniel Feiman, MBA, CMC®,
Managing Director
Build It Backwards(TM)
Transforming organizations by Turning Roadblocks into
Roadmaps(SM)
Office: 310.540.6717 Cell: 818.522.2892
Consulting & Training in:
Strategy* Finance * Process
DanielFeiman@BuildItBackwards.com
www.BuildItBackwards.com