Management Innovation is at the Top of the Innovation Stack

Note: This article is updated at Management Innovation is at the Top of the Stack.

Management Innovation is at the top of the Innovation Stack.

The Innovation Stack includes the following layers:

  1. Management Innovation
  2. Strategic Innovation
  3. Product Innovation
  4. Operational Innovation

While there is value in all of the layers, some layers of the Innovation Stack are more valuable than others in terms of overall impact.  I wrote a post that walks through each of the layers in the Innovation Stack.

I think it’s often a surprise for people that Product or Service Innovation is not at the top of the stack.   Many people assume that if you figure out the ultimate product, then victory is yours.

History shows that’s not the case, and that Management Innovation is actually where you create a breeding ground for ideas and people to flourish.

Management Innovation is all about new ways of mobilizing talent, allocating resources, and building strategies.

If you want to build an extremely competitive advantage, then build a Management Innovation advantage.  Management Innovation advantages are tough to copy or replicate.

If you’ve followed my blog, you know that I’m a fan of extreme effectiveness.   When it comes to innovation, I’ve had the privilege and pleasure of playing a role in lots of types of innovation over the years at Microsoft.   If I look back, the most significant impact has always been in the area of Management Innovation.

It’s the trump card.

Comments (3)
  1. John Hunter says:

    I agree with what I think is the premise – that better management is critical for the ability for an organization to successfully innovate.  And that bad management can kill otherwise excellent innovation in the other domains you list.

    I think calling it management innovation however is misleading.  It is true management at very valuable companies (and less valuable ones) needs a great deal of improvement.  But it is mainly adopting good management practices people like Deming, Ackoff and Drucker talked about many decades ago.

  2. J.D. Meier says:

    @ John — I know what you mean.  

    I originally thought it was just good management practices, too, but Gary Hamel makes a pretty deep and compelling case on how it's innovation in action.  He does so by contrasting emerging management practices with early management principles and philosophy, and how they've evolved.  I think we are so used to "better management" now that we take it for granted.

    I think a drill down into innovation within the management arena could yield some interesting opportunities still yet to be exploited to bring out the best in people.   And I wonder how automation will change what great management looks like as more people find ways to combine their strengths and talents with insights and machines.

  3. John Hunter says:

    "I think we are so used to "better management" now that we take it for granted."

    You are much luckier than I (both as an employee and customer).  I find very few companies show evidence of practicing what Deming, Drucker, Ackoff etc. talked about many decades ago.  Better management is still a distant hope for most organizations in my opinion.

    I do think Hamel talks about lots of good stuff.  I admit my study of his is not extensive, but from what I remember he does tend to (as do nearly all these people trying to sell their ideas) make more of what he is saying than is merited.

    It reminds me of college when about 50% of my professors in the first lecture had some version of: In [this class] we are studying the true core of knowledge, everything else is just a different take on what we will study here.  If it was physics then chemistry, biology… are really sub-disciplines of physics.  If it was philosophy everything else was a sub-discipline of philosophy.  I thought it was pretty funny.  And that passion likely made them great professors, even if I think they lost perspective on reality.

    I think even many fairly good management thinkers get hung up on the wonderfulness of their thoughts and how critical their details are.  I do still I do like Hamel but I think he is too caught up with his ideas and thinking what he has been looking at is more important than it really is.

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