Using Business Model Innovation to Reinvent the Core

Using Business Model Innovation to Reinvent the Core

          
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Using Business Model Innovation to Reinvent the Core

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    Be Prepared for Resistance

    Armed with these solutions, companies should find it easier to navigate around the common pitfalls that stand in the way of core growth. Understanding the solutions, however, is only the beginning of a longer journey. To drive meaningful impact, these ideas must take root within the organization, receive sufficient funding, and be given the runway needed to achieve scale.

    BMI can take years to fully show results. It entails greater risks as well as longer-term payback than more incremental moves, and there is often organizational resistance to change. Indeed, implementation challenges are the largest obstacle many companies face when innovating their business models. The following are a handful of best practices to help companies manage resistance:

    • Have the CEO set a bold ambition for growth from the outset. It may seem counterintuitive, but it often works best if he or she provides few details on how to achieve the target. The gap between current state and aspiration can be a powerful motivator for change.
    • Bring in experts who have successfully implemented new business models in the past. Shy away from those in nearby sectors; the key is to find people with fundamentally different perspectives.
    • Secure alignment up front—before the innovation effort even begins—to ensure a sufficient runway for the new model to succeed. This often requires engagement at the highest levels, including the board.
    • Ensure that the working team includes both champions and naysayers. And engage with the latter early and often to address concerns well before the go-no-go decision.
    • Commit to a small scale up front. It is important to succeed somewhere first before implementing the new business model more broadly.
    • Finally, plan for managing the new model as a separate business or division. A new organization, with separate talent, processes, and metrics, is often required to bring the new capabilities that are needed to run the business.