Derivative or innovative?

In my 20 years in business, I’ve met a lot of entrepreneurs. They tend to fall into one of two categories; derivative or innovative.

The first type is looking for a quick win with derivative stuff, because they think they’ll do a better job copying another’s work and using that as a basis to improve on. Oddly, they tend to think of their work as “standing on the shoulders of giants”. Many of these fail, if you’re copying another start-up, by definition those people are ahead of you and generally understand the space better because they were there first.

On the other hand, innovators run on passion – learned the hard way and, usually, with a fair dose of blood on the T-shirt. True, it’s a harder road, but the love for what’s being achieved in ground-breaking steps more than makes up for the rougher road. That’s not to say a derivative business cannot improve on the innovator, but the challenge for the less visionary is to keep up with the innovators.

The difference is largely down to the executive function. Derivative businesses depend on nailing the operational cornerstone to achieve their success. Without good operations, customer service and efficiency a derivative business will struggle, yet it will not seem clear why. In the innovative business, you’re much more dependent on the vision of the CEO and her or his ability to drive that vision home.

Sadly, many CEOs think the role is a result of investment or seniority and as a result we see poor CEOs (think Steve Ballmer) who reach wholly undeserved heady heights and end up being the cause of the demise. So, ask yourself are you working for a visionary and innovative CEO … if you are not then you’re destined to a life of operational process.

This post was inspired by Microsoft’s lost decade and the recent decision to get rid of Steve Bullmer.

By Martin Dower