A Wide-Lens Approach is Key to Successful Innovation
Why were Apple’s iPod and Amazon’s Kindle so successful when companies like Sony had come before them with e-readers and MP3 players? According to Frederick E. Allen of Forbes, “It’s All in the Ecosystem.” The ecosystem is the totality of the marketplace. Not just buyers and sellers, but also those with indirect product involvement who cannot be overlooked.
Ron Adler, professor of strategy at the Tuck Business School at Darmouth, took on the importance of the ecosystem in his book, The Wide Lens: A New Strategy for Innovation. He points to examples of brilliant innovation that failed because ignored the larger ecosystem and finds innovations that succeeded, spawning further innovation, because they took a wide lens approach.
In the 1990s, Hollywood attempted to make a move to digital projection with the release of Star Wars Episode I – The Phantom Menace. What they didn’t take into account was the cost of nearly $70,000 per screen for theaters to convert to the innovation. Seven years later, only 5% of theaters had converted to digital projection.
Sony faced a similar fate with the release of its e-reader in 2006. As it had with MP3 players, Sony was among the first to develop this innovation. However, Sony failed to recognize the importance of authors, publishers, and digital rights management. Where Sony failed, Amazon stepped in with great success.
Amazon and Apple are always held up as examples of innovation done right. But there’s a reason for that. According to Forbes, Adler’s book sums up the core of what made Amazon’s Kindle successful despite having a product that in many ways was of lesser quality than Sony’s:
Amazon did not simply bully publishers into supporting the Kindle. Amazon created conditions in the ecosystem that made joining the long-awaited e-book revolution a more attractive proposition for publishers than any previous attempt.
Where Amazon was able to create a more attractive ecosystem for e-Readers, Apple has a “mastery of the ecosystem” that has made them the supreme success story of our time, according to Adler. With an understanding of the MP3 ecosystem, Apple was able to create the iPod, roll out iTunes, expand to PC users, and later launch the iPhone and the iPad.
Click here to learn more about “Why Great Innovations Fail” – and succeed – in Forbes.