We have seen in the previous post “From Submarines to Flywheels” how traditional companies and corporations are usually working in a “Tide Model”, margin going up and down and innovation working under the surface in a submarine mode. A model that has satisfied many companies for decades! Then came the Disruption Tsunami, and then the era of sustainable innovation. That's why, Intranove created the IMAGINE Mindset model for sustainable innovation, described Here.

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The Disruptive Innovation

Disruption often results from flywheel business models that enable exponential growth. For those unfamiliar with the concept, a flywheel is a mechanical device designed to store rotational energy in an efficient way. It can be difficult to spin at first, but once momentum is built, the flywheel can perpetuate its own motion and spin by itself. Flywheel business model has become a critical component of growth.

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These concepts has been existing for years, they are not so new but they were difficult to put in place in the standard economy. The digital economy has enable an easy implementation that amplify even more this spinning effect. We have all been taken in a flywheel by either Amazon, Uber, Epic Games, Etsy, Wordpress or many others.

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Here Below, few examples showing how the concept works.

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Very soon after the first successes were understood and analyzed, entrepreneurs realized the potential of this concept in the digital economy, leading to the emergence of disruptive companies. Marketplaces, for example, are well-known applications of the flywheel principle.

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The Business Lifespan Impact

This phenomenon has been so significant that in the last two decades, most S&P 500 companies were removed from the index, reflecting a significant reduction in their average lifespan.

These business models are challenging to establish and grow slowly at first until they reach a critical size. Detecting the exponential growth of competitor's business is difficult, as their initial phase remains flat. When the growth trajectory starts resembling a hockey stick, it's often too late for the incumbent to react due to its own inertia.

Such situations may be avoided, if the company has developed an appropriate Continuous Foresight processes however, it's still not enough.

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This situation is leading to an ‘anti Flywheel’ that I will call the "Boring-Wheel," a process that contrasts with the self-excitement of a flywheel, and it's akin to a boring machine that drills the ground of your company's grave.

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While a flywheel stores and maintains rotational energy to provide inertia and smooth out variations in speed, a boring machine consumes energy to perform work by cutting into a material, removing material, and creating a hole or tunnel. In this sense, a boring machine contrasts with a flywheel as it actively consumes energy and performs work, rather than storing and maintaining energy.

In PART 3 of this series, “The Innovation Boring-Wheel Paradox” we are going to dig in the 3 mechanisms that are self-exciting themself in a mortal destiny. 

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First Aid

If you are not sure, whether your company works in a Boring-Wheel Model or you do recognize it, but you do not know how to change it: Just book a free 15 min call HERE and we will help you in your next step.

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This blog post is part of the series “IMAGINE: I for Identify”

PART 0: The IMAGINE Innovation Mindset
‍PART 1 : From Submarines to Flywheels.
PART 2 : The Disruptive Innovation: From Flywheels to Boring-Wheels.
PART 3 : The Innovation Boring-Wheel Paradox.
PART 4 : Breaking free from Boring-wheels… USE CASE.

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