Why are retailers struggling to reinvent themselves and their industry when the existential threat seems so clear? If the battle cry truly is “innovate or die,” why are so many retailers choosing death?

Photo: CGTN
Reason 1: Iteration — not Innovation
Iteration is the repetition of a process. Innovation is the invention of a process. Unfortunately, retail leaders are mistaking their initiatives as “innovative,” when in actuality they are iterative.
Of course, iteration is safe, while innovation carries inherent risk — a reasonable thing for executives to fear.
But if executives want radical ideas, they need to create an organizational definition of “innovation” and embrace it.
Reason 2: Fear of Failure
If you’re innovating, you’re failing, and if you’re not comfortable with failure, you’re not going to be innovative.
The most innovative organisations treat success and failure equally.
What matters is whether the effort moved the organization forward in its understanding. The only punishable offence is the unwillingness to take risks.
Reason 3: Vertical Benchmarking
Dressmakers compare themselves to other dressmakers. Juice bars compare themselves to other juice bars.
The problem with this is that consumers don’t think this way. Instead, they think, “why can’t my clothes shopping experience be as easy as placing a Starbucks mobile order?”
The tendency for companies to measure their success relative to competitors within the same vertical creates gaping blind spots that leave the door open to disruptors.
Reason 4: Leadership Culture
Leadership culture, particularly in the Western world, is built around executive certainty and the ability to hone in on problem solving. This breeds an organizational culture of convergent thinking, which seeks to solve problems only in a systemic way.
Instead, company executives should cultivate innovation. These kinds of leaders are not afraid to embrace uncertainty. Rather than focusing on solving problems, they are open to possibility and have an intense curiosity, causing them to question accepted norms. Why is this type of leader desirable? She promotes divergent thinking that creates opportunities.
In addition, leaders are becoming increasingly more data-driven in their decision-making. However, innovative leaders are not afraid to make decisions in the absence of data. After all, if something has never been done before, there is no data — until you create it.
Reason 5: Creativity Misunderstood
Most companies need to deepen their creative bench. How does one do this?
Unfortunately, studies indicate that creativity is beaten out of most by the time they’re adults. Thus, companies need to be intentional about hiring creativity.
Begin by hiring demonstrably creative and divergent thinkers. Next, test your current employees for their creative capacity.
In conclusion, when change happens, it happens fast. The time between Kitty Hawk and Apollo 11 was only 66 years. Today, over three billion people fly through the air each year. Eight different companies are promising space tourism by as early as 2019. What’s the point of bringing these tidbits up? One innovation at Kitty Hawk created an avalanche of change, that redefined the bounds of space and time — literally.
The time to innovate is now.
It’s encouraging to see legacy players such as LVMH and others building innovation incubators and accelerators. Fledging brands, such as Everlane and Farfetch are changing the way consumers shop.
If there is one thing to take away from this, it is this: someone will eventually reinvent what you do. What you need to determine is: will that someone be you?
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