Cross Pollination Drives Innovation
I believe having a deep specialization in business is going to be, if not already the downfall of many businesses.
If you are a very specialized business, meaning you have a very specific thing you do for a very specific customer, your efforts year after year are going to be directed to diving deeper and deeper into that service you are providing. This has always been, and still remains a very effective and popular method of building your business. What we are afraid of is that these businesses might eventually hit a ceiling where you feel you have successfully mastered this service for the specific customer and that you have made it! You have put so much effort into mastering this service that you believe there is no more opportunity for innovation. Let’s bring in the example of taxi companies.
If you owned a taxi company, how great did you feel between 1920 – 2000? You had 80 years of perfecting your business model, figuring out the best cars to use, and probably figuring out how to quadruple profit margins. But then in March 2009, your world crumbled right before you – and you may not have even known it was happening. Some no name entrepreneur, Travis Kalanick, who knew nothing about taxis started a company called Uber. His knowledge? Nothing but his pure anger at not being able to hail down a taxi with his co-founder, Garrett Camp in Paris. They dreamed of being able to simply press a button to have a cab show up for you. The simplicity of the dream was beautiful. Now, Uber is valued at 60 some billion dollars. In San Francisco, Uber has gained nearly 71% market share. How’s that for a shift?
Uber represents what it takes to be successful today. You no longer need a vast specialization in an area to succeed. First, what you need is an understanding of real problems people are facing on an everyday basis. Beyond that, I argue that a man or woman with a diverse understanding of different kinds of business models, service offerings, technology, etc. are in a better position to innovate and disrupt old industries.
This opportunity becomes even more relevant now. We are on the verge of the Internet of Things. Like it or not, our whole world will be integrated and tied into the internet in some shape or form. Industries whom haven’t seen any use of the internet will now be forced to do so. You will see 100 year old businesses collapse because they aren’t willing to jump on the movement, innovate, and adopt practices that other industries are using and have succeeded with.
I wrote this post for two reasons:
I continually meet business owners who are comfortable with where they are, believe they have found the secret sauce for their industry, and are unwilling to adopt current trends. To anyone like this, I am writing this to light the fire within you. Things are changing every day and it’s very possible these days that a high school student could recognize an opportunity in your industry before you do. Start innovating by looking at other industries. What’s working? What’s not? Mesh business models. Do something! Things are about to change, so you need to as well.
I am a HUGE believer in self-education. I believe, however, that if you are only educating yourself on certain topics/industries, you are setting yourself up to be the next taxi company. Invest yourself in multiple topics. Read something that you see no relevance to. It may seem like no value to you, until it is. Cross pollination of knowledge breeds innovation.
I am excited for the next 20 years in business. The integration of internet into literally everything is going to be an exciting, up and down journey. It’s going to take a diverse knowledge and the motivation to innovate in order to last through these changing times. Are you in?