This article was originally published on the Harvard Business Review Blog Network.
If we want more entrepreneurs, stop worrying about jumpstarting innovation. Focus on "minnovation."
In reality, the vast majority of real-life entrepreneurs around the world aren't innovators. They're minnovators — mixing small parts of novelty and creativity with huge helpings of flexibility, scrappiness, and a generous portion of hard-driving execution.
Public officials from Colombia to New Zealand are hoping to create the next Silicon Valley by building modern "innovation centers" for entrepreneurs. But that tactic may unwittingly backfire: overemphasis on innovation as the pillar of entrepreneurship could actually stunt entrepreneurial growth. Some potential entrepreneurs, who think entrepreneurship is only about innovation, don't even bother trying because they know their chances of being the next Bill Gates or Steve Jobs are nil.
You don't need to have a Ph.D., a team of engineers, a wall of patents, or even the proverbial garage. More often than not you need that little twist on an existing idea, the tweak of the business model, the minor product adaptation, or even just the ability to put together and lead a fantastic team that is supremely resourceful in overcoming obstacles and driving the tweaked idea to market.
Here's a great example. Cinemex created hundreds of millions of dollars of shareholder value by transforming the entertainment experience of millions of Mexicans. Founded in 1995 by three recent Harvard MBAs, Cinemex introduced version of the multi-screen cinema concept — an entertainment format well known in other parts of the world — to Mexico City. In the words of co-founder and former Cinemex CEO, Miguel Davila, "The only innovation we introduced was putting lime juice and chili sauce on the popcorn instead of butter."
Davila et al minnovated: the spark of novelty consisted of identifying the right time to introduce a tried and proven business model into a new market. Their success was the result of (a) getting the timing right, (b) bringing in the expertise from the US (in the person of co-founder Matt Heyman, who had experience in the industry), and (c) amazing execution, which was at times unusually creative.
Sandi Cesko is another example of a successful minnovator. Cesko
created Studio Moderna, the leading online, multichannel retailer
in 21 countries in Central and Eastern Europe. When Cesko saw the
large TV shopping companies from the US fail in Eastern Europe, he
took their strategy of outsourcing all of the critical functions —
infomercial creation, call centers, delivery, payment — to third
parties and stood it on its head: Cesko minnovated by insourcing
those functions, bringing them in-house so that he could achieve an
unprecedented level of service, and in doing so, he won Eastern
European consumers' trust in a very untrusting market. Studio
Moderna's sales roared passed EUR 200 million in 2008.
No venture can be less innovative than generic pharmaceuticals. That business starts when the innovative drugs' patents go stale and the drugs have inherently no differentiators; the innovation is officially dead. Does that mean that generics entrepreneurship died too? If it did, Robert Wessman forgot to read the obituaries, because he is one of the generics industry's great minnovators, building Reykjavik-based Actavis in eight years from a standing start to fifth in the industry, and creating over two billion euros in shareholder value. His minnovation was first and foremost conceptual in nature: he realized that to survive as a generics player, Actavis had no choice but to be big, diversified and global, with globally dispersed, large-scale manufacturing coupled with clusters of focused R&D, all serving an increasing number of markets around the world.
When latent entrepreneurs I talk to hear success stories of minnovators, the inevitable email hastens to follow: "I was always afraid to set up my own venture because I don't have any great ideas, but having seen these normal people succeeding, I know I can do it too."
So move over Schumpeter and creative destruction. You had your sound bite — but now it's time for a generation of minnovators to emerge.