Excerpt from Transformative

As I have had the privilege of meeting with and working with management teams from hundreds of organizations, I have come to see that leadership teams almost universally struggle with three fundamental elements of their business. Specifically, how to:
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1. Create a product or service that is uniquely differentiated and valuable to the customer.
2. Define and execute a strategy to reach a market leadership position, including the right goals and actions to achieve it.
3. Cultivate an agile organization that can maintain a long-term advantage through a constantly shifting business environment.

Despite the importance of these foundational elements, the leaders at many organizations don’t put in the effort to answer them. When they try, they often focus on product innovation as the primary source of differentiation and competitive advantage, essentially mistaking product innovation for strategy. This is understandable at the early stages of the company when an organization seeks product-market fit. However, it often results in a continuous focus on innovating features and function without a clear strategy. The result is a product that is different without being differentiated and a failure to create real long-term advantage.

The type of transformative change that organizations seek isn’t accomplished with great innovative technology alone. While product or technical innovation is essential, focusing on it exclusively will not produce the type of change that shakes up market leadership and rebalances the odds in a company’s favor.

I believe that many organizations today face an even more significant leadership challenge than Intel faced: developing the momentum and the strategy for change, even when the need for change isn’t immediately apparent. This is the greatest challenge every organization faces: to walk out the door and come back through again with a fresh perspective on how to change.

Fortunately, most organizational leaders already recognize that change is necessary. A survey of Fortune 500 CEOs found that 94 percent of Fortune 500 CEOs agreed with the statement “My company will change more in the next five years than it has in the last five years.” The question for most organizations is how to develop the momentum to walk back in the front door with a viable and winning innovation plan.

Explore this and other topics in the upcoming book Transformative.