By: W. Chan Kim, Renée Mauborgne, Mi Ji
06/16/2022
This is a challenging time for many companies. On the one hand, supply chain disruption, labor shortage, and raw material and energy price hikes are driving up business costs. On the other, demand is slack due to consumers’ reduced purchasing power and an uncertain global economic outlook. Together, these conditions squeeze companies’ profits and cast a shadow on their growth prospects. Executives everywhere in the world find it more urgent than ever to sharpen their organizations’ innovation strategy to create new markets for growth.
Economics has long taught us that R&D and technology advances, as measured by R&D spending and numbers of patents, are the central drivers of innovation and growth. But market creation for growth isn’t inevitably about technological innovation.
Consider how Comic Relief, a major and distinctive charity based in the United Kingdom, created a new market in the deep red ocean of the charity industry where competition was intense and growing, costs were up, and donations were down. It did so by redefining the industry problem and engaging everyone to do something funny for charitable giving.