Iteration vs Innovation: Which Matters More in Business?
But the main point Wardle makes about iteration is that you intentionally aren’t inventing something new. You’re finding something that already exists and choosing to make it better.
To iterate or to innovate?
What, actually, is the difference?
I wasn’t sure myself until a few months ago, when I had the opportunity to listen to, and learn from, a genius named Duncan Wardle.
Wardle’s creative credentials are as bona fide as you can get. And he articulates the concepts of iteration and innovation better than anyone else I’ve encountered.
Here’s my highlight reel from Duncan Wardle’s talk—and what I’ve learned about the importance of iteration AND innovation in business.
Iterating and Innovating
First, let’s talk iteration. Our firm is no stranger to iteration. We’ve called this technique an entrepreneur’s best friend.
In a nutshell, iteration takes something already being done (by you or someone else) and makes it incrementally better. Over time, you can achieve significant improvements through iteration—and great success.
But the main point Wardle makes about iteration is that you intentionally aren’t inventing something new. You’re finding something that already exists and choosing to make it better.
Next, you have innovation. Often confused for iteration, innovation is an entirely different animal.
You innovate when you solve a problem the world doesn’t even know exists.
You can also innovate when you solve a known problem with an unknown solution.
Innovation is creating something from new, starting from scratch. It often comes from asking questions when you don’t yet know the answers.
A couple of examples to help differentiate:
Iteration: creating a more fuel-efficient car
Innovation: creating an electric car that dispenses with fuel altogether
Iteration: Dunkin’ - starting as a coffee shop that continues to iterate on the food and drink they sell
Innovation: Starbucks - building an environment (the third place) that also happens to sell coffee
When to Use Innovation vs Iteration
Most of the time, most companies are using an iterative mindset to address and solve their problems.
Yes, iteration is less sexy. But it’s also practical, less costly, and often the right tool for getting the job done.
Not all companies are meant to be Apple or Google.* And even Apple and Google use plenty of iteration in their product development.
When appropriate, though, your business should be willing to innovate instead of iterate. Why? Because although innovation is far riskier, the potential payoff is much greater. Instead of being best in class, innovation offers the opportunity to be in a class of one.
If you want to innovate, you have to start asking the big questions. The “what if” questions that you have to grapple with for days, weeks, even years to answer. The kind that require long, meandering discussions to think through.
*You can , however, take a page from these kinds of companies by swiping their goal-setting method. Check out our webinar on OKRs for more information.
Innovation in Practice
I mentioned Duncan Wardle has the best creative credentials around.* So you might be able to guess where he spent most of his career…
That’s right. Working for The Mouse. Wardle is the former Head of Innovation and Creativity at The Walt Disney Company.
Part of what makes Disney the gold standard in innovation is that they have entire departments dedicated to thinking about this stuff all day long.
They also generate and analyze a tremendous amount of data. But instead of a straightforward analysis of the data (say, on guest preferences and satisfaction), they think creatively about how to interpret the data, how to mine it for the deeper stories.
Suppose their data says that the 35-39 demographic loves riding Space Mountain. Taking an iterative approach, you might assume that the best thing Disney could do is build another roller coaster similar to Space Mountain—or even make updates to Space Mountain itself.
But what if that’s not why 35-39 year olds like Space Mountain at all?
What if they love the attraction because it reminds them of that feeling they got when they were 9 years old and finally tall enough to ride the coaster for the very first time?
If you’re Disney, you want to bottle that feeling of being 9 years old. And a new roller coaster might not be the best way to do it.
If you want to explore Wardle’s approach to innovation, I highly recommend checking out his ID8 workshops.
Replacing Can’t with Can
If you take anything away from this piece, I hope it’s this:
Sometimes, in business, it feels like there are a million reasons why you can’t do something. Financial pressure, customer expectations, industry practices, lack of resources.
Those constraints are real and shouldn’t be ignored.
But it’s important, every now and then, to push beyond the constraints and ask, “But what if we can?”
P.S. What’s one thing you’d like to innovate in your business or your industry? Let me know.
