Transformational Innovations

blog | philmckinney | November 29, 2007 at 7:51 pm

Me, Myself and I

The ultimate objective of any innovation is to transform business and transform lives.  How do you know if your innovation is of that transformational kind?  Here are my definitions that I use for the different stages/types of business:

  • If you charge for undifferentiated stuff, then you are in the commodity business.
  • If you charge for distinctive/differentiated tangible things, then you are in the goods business.
  • If you charge for the activities you perform, then you are in the service business.
  • If you charge for the time customers spend with you, then and only then are you in the experience business.
  • If you charge for the benefit customers (or "guests") receive as a result of spending that time, you are in the transformation business.

I would argue that to win in the market, you need to aim your innovation efforts towards creating a transformational business.

So …

  1. Which business type are you operating under?
  2. What innovations would you need to create to re-define your business?

 

2 Comments

  1. Michael Zerman says:
    December 2, 2007 at 11:12 pm

    Hi there,
    I’ve published a brief (900 words) piece on Innovation & Incubation that may be of interest, at:
    http://www.zerman.net/content.html#InnovationIncubation122007
    Regards,
    Michael Zerman
    Adelaide, AUSTRALIA

  2. Boon says:
    December 28, 2007 at 5:09 am

    You struck a chord on this post – it does provide insight into what comes after the “experience economy”.
    Hope you don’t mind I referenced your article on my blog.
    Also, I found a Harvard Business Review article that described the commodities to experience ramp in 1998. I thought that was interesting.