Organizational renewal

• All businesses have two tasks: 1. deliver today's profits and 2. create tomorrow's offerings - renewal.
• Delivery means efficient execution, renewal requires innovation.
• Competing on cost, quality and service = majoring on delivery.
• Fast changing markets require constant renewal through innovation.

You don't have to run an old fashioned factory to overlook organizational renewal.

• Process innovation leads to better delivery, not renewal.
• Product or service innovation gives birth to future product generations - this is renewal.
• Increasing the efficiency of delivery is like an older person getting in better shape.
• Genuine renewal replaces an older generation of products with a younger generation.
• Business process re-engineering improves efficiency but delays the harder task of genuine renewal.
• This buys time in the short term and makes executives feel that they are doing something.
• High volume, low cost businesses are locked in an efficiency race.
• Renewal through new products is the only way off this treadmill.
• But high efficiency cultures with their "right first time' slogans are not conducive to risk taking.
• Organizations that excel in renewing themselves are much more entrepreneurial.