Reimagining Everything.

Almost every CEO that you listen to whether they are in Davos (WEF), Barcelona (MWC) or in Falund (CEO Summit) they all talk about how Internet of Things, Digitalization, and Cloud will enable smart and connected products to be come the future of profitability for their companies.

This means that they will be empowering their innovators to start Reimagining Everything. Reflecting on Clay Christensen book “The Innovator's Solution”. As the re-imagination journey to create new market for new product and services starts, innovators need to answer one very critical question in order to get the scope of the business right:

“Which activities should a new growth area do internally in order to be as successful as possible as fast as possible and which should be outsourced?”

The standard answer that you will get from most organizations is; “If it fits our core competence we should do it and if its not and other firms are doing it better then we should outsource it.” Right?

Here is the dilemma with the core competency view. In a world that every thing can be re-imagined and shape of the business that you are in will change to something new what is not core today may well have to be your core tomorrow, as the new core will drive profit.

We have all heard the IBM story. Their decision to outsource its PC business to Intel for microprocessors and to Microsoft for its OS, as they believed back then that their core business was in mainframe and PC market didn’t had market potentials.

When a company is re-imagining a product, like Tesla dose with Electric Cars or Nest with Thermostat, instead of asking what their company dose best today, they ask “what do we need to master today and what do we need to master in the future” in order to solve our customers problem.

As you are re-imagining a product, it means that no one has done it before they way that you are going to do it and therefore your approach to its development, deployment and operation needs to be done as a “full stack” and end-to-end or as Clay Christensen describes it in his book an “Interdependent Architecture” approach to optimize performance, in terms of functionality and reliability as well as freedom in design and customer experience.