Are radical business concepts the result of luck or foresight?

Are radical business concepts the result of luck or foresight?

Where do radical business concepts come from? Luck or foresight?

New business concepts are always the product of lucky foresight. Not from Big Data, analytics or competitive business analysis. Predictive models, such as Michael Porter’s 5 Forces, are all based on economic theory using data, demographics, your own company’s economic situation, and your competitors’ comparable information.

While these predictive models might give us a sense of security, most real innovation comes from the power of randomness.

Nassim Taleb writes in The Black Swan: The impact of the highly improbable:

It is high time to recognize that we humans are far better at doing than understanding, and better at tinkering than inventing. But we don’t know it. We truly live under the illusion or order believing that planning and forecasting are possible. We are scared of the random, yet we live from its fruits. We are so scared of the random that we create disciplines that try to make sense of the past but we ultimately fail to understand it, just as we fail to see the future.

Random tinkering is the path to success. And fortunately, we are increasingly learning to practice it without knowing it thanks to overconfident entrepreneurs, naive investors, greedy investment bankers, confused scientists and aggressive venture capitalists brought together by the free-market system.

Paradigm shifting innovations such as Post-its, teflon, Viagra, and many others emerged out of experimentation and intuition, not from a strategic innovation process based on a specific plan.

The activities that lead to innovation, experimentation to find ones own insights, scares the heck out of most everyone. So it’s far easier to look at what others are doing and do the same. Specifically, searching for a silver bullet recipe. As Umair Haque says, people are addicted to the BIG IDEA. In most cases, the big idea is the “shortcut to success“:

What’s the secret? Do you know the secret? Is that the secret? “Supermastery?”…“gritsilience?”…is that it…this month?

We live in a medicated culture. And the narcotic of this age isn’t television. It’s the mythology of the Big Idea.

The Shortcut. The Hack. The Formula. The Method. The Program. The ten point plan. The bullet pointed list. The five step ladder. The one-two-three.

Can you tell me? I need to know. What’s the secret? How else will I live the life of my dreams? They do. They must know a secret I don’t.

The silver bullet recipe is bullshit, of course. For example, while most everyone I know toots the horn of the Lean Startup, what nobody really gets is that it leads to incremental ideas. Really, it does. Yet, none of the things we really value were conceived from frameworks, shortcuts, methods, programs, etc..

Bottom line: Essential insight doesn’t come out of any planning process; it comes from some combination of happenstance, desire, curiosity, ambition and need. But at the end of the day, there has to be some degree of foresight. So radical innovation is always one part fortuity and one part clearheaded vision.