The likelihood is that you would love to find the next disruptive innovation that changes your market and your business fortunes. But spending all of your spare time and creative resource on this endeavour isn’t the smartest business move.
The fact is that small steps are far more likely to generate your business success. However, that doesn’t mean you shouldn’t spend any idea time on the holy grail. A good rule of thumb is the 70:20:10 principle.
The origin of this method originated from learning and development. Not from innovation. The principle outlines that 70% of learning comes from job related experiences. 20% from interactions with colleagues and social learning. And 10% of learning comes from formal education such as classes.
But the 70:20:10 principle can be applied to innovation too. Eric Schmidt, former CEO of Google, provides a well used example. Whilst CEO he implemented the theory.
Small ideas versus big ideas
Core innovation is crucial to continuously stay ahead. The big disruptive ideas are few and far between. Focusing the majority of your time on core innovation and ideas means investing in improvements in your day to day business. This may be small incremental improvements in your product/service or processes, but will make the difference.
Apple spend most of their time and money (around 70%) on making improvements to their current products, rather than releasing entirely new ones.
According to Harvard Business Review, companies that follow the general principle of 70:20:10 outperform peers and have a higher price-earnings ratio.
Disruptive ideas, when successful, really do bring big returns. But if this is all you focus on, the likelihood is you’ll be out of business before you find the right one. The smartest play is to balance your innovation across core, adjacent and disruptive. This gives you the ability to thrive whilst you look for that big idea.
Going beyond the organisation
And this 70:20:10 principle isn’t just something you should implement at an organisational level. Rather, you should try and encourage individuals to implement it too. If employees spend 70% of their time on their core role and daily tasks, 20% on looking for new opportunities within what they do and 10% out of the box thinking about projects that will improve overall performance, you’ll start to see a marked difference in your business growth and productivity.
If you’d like more information and guidance on how to start implementing the 70:20:10 principle, get in touch, at Idarc we’re full of ideas!