Posted by Look for the outliers, companies that are so different as to be puzzling. What makes some outliers powerful, and noteworthy to strategic thinkers, is their ability to “punch above their weight”. In other words, these easily dismissed outliers amplify the effects they have across various industries and generate potent, transformative change. Innovative new methods that outliers are currently using for such strategic impact include:
1) Contributor architectures that facilitate unlikely encounters. Startup Nectar incubates new “bio-mimicry” businesses, a field where experts in life sciences like biology together with engineers, architects, computer scientists and corporate managers come together to fit the designs and processes of the natural world into new buildings, products, and services. Recent bio-mimetic innovations have ranged from a new industrial strength Velcro inspired by clams latching onto rocks to pest control through the natural predatory chains by the Brazilian company BUG – chosen as one of the most innovative companies by Fast Company-magazine. Another contributor architecture, GrowVC, connects entrepreneurs and investors in a global marketplace for equity funding. With the slogan “everyone funding startups”, the versatile platform allows anyone to invest in startups with capital or expertise. GrowVC provides an open environment that brings together experts, new customers, partners and even startup team members. The global platform aims to disrupt the venture capitalist-led start-up model and democratize access to capital. To date GrowVC has worked with over 4800 startups worldwide.
2) On-demand design fuelled by additive manufacturing. With the rapid evolution of 3-D printing technology, many companies that would have previously had to rely on expensive, scale-driven factory manufacturing can now take advantage of the “plug-and-play” characteristics of free software applications and digital manufacturing. Shapeways is a 3D printing marketplace and community that hosts over 3000 local businesses and independent designers showcasing their products in a web-based platform just like a storefront. Clients can customize products to their liking and have them manufactured on-demand. Shipping from its New York-based digital factory hub, Shapeways has sold more than one million products while holding no inventory by only producing what the consumer wishes to buy, all with minimal material waste (a nice feature of additive manufacturing), Moreover, the company is exploring the potential of design apps to create complex yet fully personalized design products. A recent curiosity is an app that turns a person’s Facebook social graph into a 3D-printed sculpture.
3) Inviting everyone to meddle is about the blurring of the old boundaries between producers and consumers and “outsourcing” key operational aspects to a wider community. Quirky’s hundreds of thousands of online users vote on the most promising new consumer product designs and then interact with the company’s staff on modifications and improvements to them. This collaborative, out-in-the-open process is both rapid and efficient, with viable new products often coming onto the market in a matter of weeks or even days. Anyone in the world can participate in every phase of the product development, from design to branding or pricing, and Quirky regularly shares up to 30% of its revenue directly with the members who contributed to the final features of launched products. In three years, Quirky has built a product development community of 570 000 people and launches on average three new consumer products each week, sold in a network of 188 retail partners.
4) Cost compression for bio-innovation: Pharmaceutical companies face staggering costs for testing new drugs. Organovo’s “bio-printer” allows them to create cheap, customizable batches of living tissue like hearts, livers and kidneys specifically for use in medical trials such as drug dosage or biocompatibility testing. By directly using the human living tissue, instead of a proxy, the reliability of tests is increased while the development time is reduced. The company’s combination of tissue engineering and 3D printing may yet to revolutionize clinical trials and, eventually, regenerative medicine. In the future it will likely be possible to bioprint more complex tissues and organs, with enormous implications for patients waiting for life-saving implants.
5) Designing generativity into the problem solving is the art of quickly developing many ideas that are “test-driven”. Wikispeed convened an impressive cross-disciplinary team of 12 engineers, researchers, designers, and other highly qualified volunteer-innovators to collaborate remotely on a practical and attractive commuter car. Wikispeed approached car manufacturing as advanced software development to create a road-legal car with a reasonable price that consumed less than 2,4 L per 100 km. In three months, the team solved complex problems of automotive engineering and manufacturing by working in seven-day cycles, iterating and reviewing progress every week, and rapid-testing ideas before committing to a particular design. The vehicle design is extremely modular to enable the quick identification of problems and their rapid resolution – several people are able to work on smaller modular units simultaneously and explore a wide range of solutions. Moreover, radical transparency is fostered: the larger contributor community shares its learning from testing the prototypes, and customers and competitors can join the process and build on Wikispeed’s highly modular intellectual property.
The outlier examples described may sound like science fiction. We can all think of many reasons why these pioneers will not make it. But even if these particular companies will not be resilient, their strategies suggest positive dynamics that reinforce, and hence amplify, change. GrowVC has built a smooth platform for contribution for ideas, capital and expertise (even sweat equity). Organovo targets radical compression of time and cost. Shapeways transforms manufacturing as we know it. Quirky engages hundreds of thousands of people in search of the next great consumer product, eliminating an internal product development function. Wikispeed takes openness and modularity to new extremes.
How to renew our strategic thinking? Study these and other outlier companies that are already delivering transformative change – punching above their weight for strategy amplification.
For a more in-depth discussion, see Välikangas, L. “Amplifying Strategic Thinking Through Outliers”, BoardView 1:10-13, 2013.