Chasing the Rabbit: Official Blog by Author Steven Spear

Thomas Friedman is absolutely correct (”While Detroit Slept,” December 10, 2008).  The particular issues being addressed in any bailout plan are merely symptoms of a more fundamental problem: an institutionalized inability to improve, innovate, and invent as a core capability.  This is characteristic of Detroit specifically; it is also characteristic more generally of institutional failures.  The flipside is that great success goes to those who learn how to create a dynamic of high speed, relentless, broad based innovation.

I base this assertion on research I did, starting in the mid 1990s.  I was studying Toyota, trying to understand how it was able to widen its lead on its competitors, increasing the number of dimensions on which it was competing even though Toyota had been studying so extensively.  What I discovered is that for all the fervor to copy it in the form of ‘lean manufacturing’ tools–value stream maps, pull systems, standard work, etc.– people had missed the fundamental issue that Toyota had learned how to institutionalize innovation in a large complex organization generating surprising agility and responsiveness relative to its competitors.  Consequently, with much less effort it could generate far greater yield, first outstripping the field on quality and production efficiency, later on product diversity, time to market, regionalization of its business, hybrid drive, and so forth.  

As Friedman has so often pointed out, innovation is what distinguishes success from failure for economies, military campaigns, or corporations.  When I extended my research from Toyota specifically, I found it goes one step beyond that.  Other organizations that were able to institutionalize innovation as well.  

For instance, my book, “Chasing the Rabbit: How Market Leaders Outdistance the Competition” lays out examples as diverse as product and process design, heavy industry and high-tech, products and services, and dot.com. The US Navy’s experience developing nuclear propulsion in the late ’40s and early ’50s

Perhaps the most immediately compelling examples are in health care, where some providers have learned to provide nearly double the care at half the cost as has been accepted as the norm.  Were others to do on a national level what the pioneers have tried and accomplished, health care would disappear as a problem demanding we either spend more or accept less. 

Related posts:

1. Toyoda to Run Toyota–Stoking the Innovation Engine
2. Chasing the Rabbit wins prize and great review for how-to of systematizing innovation
3. Innovation and Workforce Engagement in a High-Velocity World
4. Toyota Trims Sails in Tough Economic Seas: No one thrown overboard
5. Why Bailout Chrysler/Cerberus? The Times Gets it Right