Content area
Full Text
When it comes to innovation and growth, corporate leadership faces a paradox. On the one hand, visionary opportunity identification is essential to the long-term growth of the enterprise. On the other, operational challenges and quarterly revenue objectives mandate a focus on short-term results. To make matters worse, the world of emerging "white spaces" is a big place. How do you even start to identify major growth opportunities?
At Hewlett-Packard, we are finding ways to overcome these critical issues. HP has a long history of introducing technologies and products that revolutionize existing industries or create entirely new markets. Because of this, we have grown-so much that we are on the verge of breaking into the ranks of the largest 10 companies in America. We are well-aware, however, that the compound annual growth rate of the fastest growing Fortune 10 company is only about 4 percent. Faced with the "growth stall" that besets the largest organizations, we are challenged to develop a new model that will enable a $40+ billion organization to achieve uninterrupted, profitable, double-digit growth for decades to come. We are approaching this task by distilling the knowledge that has contributed to our rich history and developing new business processes and methodologies that will help us address our most pressing challenge-how to sustain substantial growth into the future.
Discontinuous Innovation
Like the pursuit of good health, the quest for corporate growth is an everlasting and disciplined exercise. Just as fit individuals must strengthen their bodies through a multitude of activities-cardiovascular, muscular, dietary, and others-corporations must pursue well-rounded growth strategies, from incremental improvements to breakthroughs that create new industries and markets. Although incremental innovations are critical for protecting revenues through growing market share, substantial growth over the long horizon requires discontinuous innovation.
Michael Tushman and Charles O'Reilly suggest that discontinuous innovation involves breaking with the past to create new technologies, processes, and organizational "S-curves" that result in significant leaps in the value delivered to customers. Similarly, Clay Christensen, Gary Hamel and C.K. Prahalad, and James Utterback describe discontinuous innovation as involving "disruptive technologies," "discontinuities," or "radical innovations" that permit entire industries and markets to emerge, transform, or disappear. Hewlett-Packard's inkjet printer platform, for example, represents a discontinuous innovation; this radical technology displaced dotmatrix printing, helped create...