Out-Innovate the Competition with Uncertainty and Surprise

Most leaders are taught to avoid uncertainty.  Big visions, carefully crafted strategies, and thoughtful plans are signs of great innovators.

Surprise is the enemy.

Or, is it?

Could we be overlooking – even resisting – one of the most essential catalysts of personal and business breakthroughs? Could we be ignoring the most fundamental tool that anyone can use to create disruptive innovation and change?

Here’s the problem.  Creating game changers – whether products, services, or new business models – requires leaders, teams, and organizations to live with uncertainty, embrace ambiguity, and respond to both good and bad surprises along the way.

Some companies and leaders have experienced the inherent value of uncertainty and surprise, and actually use it to out-innovate the competition:

Intuit’s flagship product was Quicken, the leading software program for managing home finances.  But early on, CEO Scott Cook and his leadership team kept hearing that small businesses were using the product.  Quicken was designed for balancing checkbooks, not for the type of debit accounting needed to run a business.  Cook dismissed his own market data for over a year.  But when a survey came back indicating about 50 percent of Quicken’s customers were small businesses, Cook decided to look into the cause.  What he realized surprised him – twice!  He first discovered that the vast majority of small business owners didn’t know how to do debit accounting, and didn’t want to learn it, which was precisely why they were using the wrong product – because Quicken was simple and easy to use.  This initial surprise led to an even bigger one:  the market for small-business-accounting software was ripe for the taking.  Cook and his team went to work and created QuickBooks.  Three months after launching the small-business-accounting program, Intuit captured almost 70 percent of the market.  The product remains one of the company’s biggest and most profitable businesses today.

Of course, not all surprises are good ones. When bad things happen unexpectedly, it’s natural to resist them. Sometimes, however, it’s possible to transform the negative into a positive. During OpenTable’s early days, the online restaurant reservation service received a big blow to its business model. Danny Meyer, famed New York restaurateur, told OpenTable’s CEO, “Look, I don’t need more business. We’re full every night.” Meyer represented the most prestigious customer in one of the most important food cities in the world, and he didn’t need the service. This surprise led to a big shift for OpenTable: In addition to restaurant reservations, the company developed a “guest management” platform to also capture and provide detailed data on the restaurants’ diners themselves. By flipping the negative into a positive, OpenTable capitalized on two complementary needs and became the leader in the market.

When unexpected events or experiences occur, rather than fight them, there can be value in looking into the heart of the surprise to uncover what it may be telling us.  A surprise is a surprise because it forces us to revisit assumptions.  The stronger our reaction – either positive or negative – the stronger our assumptions are likely challenged or reinforced by the surprise.

Charting new territory involves using uncertainty as a tool to discover direction. The real missing ingredient for breakthroughs that leapfrog mindsets and markets lies in how we uncover, interpret and respond to the single most predictable aspect of real innovation – the inevitable surprises that will come our way.

Author note: This article is based on the book Leapfrogging:  Harness the Power of Surprise for Business Breakthroughs with direct excerpts used from the recently published ChangeThis Manifesto by 800-CEO-Read.

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Soren Kaplan is the author of Leapfrogging and a Managing Principal at InnovationPoint LLC where he advises start-ups and also consults to Cisco, Colgate, Disney, Medtronic, Visa, and others larger firms. He led the internal strategy group at HP and is an Adjunct Professor within the Imagineering Academy at NHTV Breda University of Applied Sciences in The Netherlands. To learn about the book Leapfrogging or contact Soren visit www.leapfrogging.com