Innovation is the driving force that propels organizations forward, but not all innovations are created equal. To effectively drive innovation, organizations can maximize their resources, minimize risks, and increase their chances of success by understanding the art of innovation.
In his book “Great by Choice,” Jim Collins discusses the analogy of bullets and cannonballs. Every organization needs more resources in terms of time, people, and cash flow for funding innovation. This limited resource is akin to “dry powder” or, in our analogy, “gunpowder.” When resources are scarce, organizations have two options: they can use all their resources to build a cannonball and launch it at the target, or they can opt for a more targeted approach by firing bullets as low-cost experiments or initiatives. A business can create small teams that work on good ideas, including moonshot ideas and those grounded in the near term, and use fail-fast approaches to test those ideas. These initial prototypes are like bullets, allowing us to experiment with new technologies, take calculated risks, and iterate quickly.
The sequencing of these bullets eventually leads to the creation of a good product or solution offering. Once this solution is created like a minimum viable product (MVP), we can set revenue targets, develop marketing collateral, and sell it to customers. These MVPs are the equivalent of a cannonball. This requires substantial capital investment from the R&D budget. It involves driving go-to-market strategies to establish them as mainstream solution offerings, with an independent business unit responsible for generating revenue.
The key to practical innovation lies in striking the right balance between cannonballs and bullets. By launching bullets first, organizations can gather valuable insights and data, allowing them to make informed decisions about which innovations are worth the investment required to turn them into cannonballs. This strategic approach maximizes success rates and minimizes resource wastage, ensuring that data and insights guide innovation initiatives.
Innovation is crucial for business growth, and the bullets-and-cannonballs analogy provides a tactical framework to amplify its impact. By finding the optimal balance between agile, small-scale bullets and strategic, expansive cannonballs, organizations can precisely navigate the business landscape, reduce risks, and unlock their full potential for development and differentiation.
