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Leadership & Business Wisdom

Test of Innovation

Measure innovations by what they contribute to market and customer.

The test of an innovation is whether it creates value. Innovation means the creation of new value and new satisfaction for the customer. A novelty only creates amusement. Yet, again and again, managements decide to innovate for no other reason than that they are bored with doing the same thing or making the same product day in and day out. The test of an innovation, as well as the test of “quality,” is not “Do we like it?” It is “Do customers want it and will they pay for it?”

Organizations measure innovations not by their scientific or technological importance but by what they contribute to market and customer. They consider social innovation to be as important as technological innovation. Installment selling may have had a greater impact on economies and markets than most of the great scientific advances in this century.

ACTION POINT: Identify innovations in your organization that are novelties versus those that are creating value. Did you launch the novelties because you were bored with doing the same thing? If so, make sure your next new product or service meets your customers’ needs.

Knowledge External to the Enterprise

The technologies that are likely to have the greatest impact on a company and an industry are technologies outside its own field.

Many changes that have transformed enterprises have originated outside the specific industry of that enterprise. Here are three notable examples. The zipper was originally invented to close bales of heavy goods, such as grain, particularly in seaports. Nobody thought of using it for clothing. The clothing industry did not think it could replace buttons. And the inventor never dreamed it would be successful in the clothing industry.

Commercial paper (that is, short-term notes originated by nonbank financial institutions) did not originate with banks, but had a tremendous negative impact on them. Under U.S. law, commercial paper is considered a security, which means that commercial banks cannot deal in it. Because financial services companies, such as Goldman Sachs, Merrill Lynch, GE Capital, and so on, discovered this, they have largely replaced commercial banks as the world’s most important and leading financial institutions. Fiberglass cable, the invention that has revolutionized the telephone industry, did not come out of the great telephone research labs in the U.S., Japan, or Germany. It came, rather, from a glass company, Corning.

ACTION POINT: Identify at least one change that has originated outside your industry that either has transformed or has the potential to transform your enterprise. Look for ideas in other industries that can be used profitably in your industry.

“Under the guise of being nice guys, the central bankers have done to the people what no army in history has been evil enough to do.”

Jarod Kintz,

“If you owe your bank a hundred pounds, you have a problem. But if you owe a million, it has.”

John Maynard Keynes

“What is robbing a bank compared to founding one?”

Bertolt Brecht


“By this means the government may secretly and unobserved, confiscate the wealth of the people, and not one man in a million will detect the theft.”

John Maynard Keynes

“When you need to borrow money the Mob seems like a better deal I think. ‘You don’t pay me back I break both yer legs.’ Is that all? You won’t take my house or wreck my credit rating? Fine where do I sign. Legs? Fine. You don’t even have to sign anything. ”

Craig Ferguson

“Suckers think that you cure greed with money, addiction with substances, expert problems with experts, banking with bankers, economics with economists, and debt crises with debt spending”

Nassim Nicholas Taleb,

“I own nothing, but at least nothing owns me. Well, besides the bank.”

Jarod Kintz

“all loans, in the eyes of honest borrowers, must eventually he repaid. All credit is debt. Proposals for an increased volume of credit, therefore, are merely another name for proposals for an increased burden of debt. They would seem considerably less inviting if they were habitually referred to by the second name instead of by the first.”

Henry Hazlitt

“New Golden Rule of Fractional Reserve Banking: He who creates the “fool’s gold” controls the fools.”

Orrin Woodward

“I would call myself Scot Chtape, but my name would probably stick to the roof of my mouth. And that’s bad for business, just like fractional reserve banking.”

Jarod Kintz

“Your comfort zone is a place where you keep yourself in a self-illusion and nothing can grow there but your potentiality can grow only when you can think and grow out of that zone.”

Rashedur Ryan Rahman

“A leader should always be open to criticism, not silencing dissent. Any leader who does not tolerate criticism from the public is afraid of their dirty hands to be revealed under heavy light. And such a leader is dangerous, because they only feel secure in the darkness. Only a leader who is free from corruption welcomes scrutiny; for scrutiny allows a good leader to be an even greater leader.”

Suzy Kassem

“Not even ten additional years of slavery could have done so much to throttle the thrift of the freedmen as the mismanagement and bankruptcy of the series of savings banks chartered by the Nation for their especial aid.”

W.E.B. Du Bois

“Banks do not create money for the public good. They are businesses owned by private shareholders. Their purpose is to make a profit.”

John Rogers

“Pick a leader who will make their citizens proud. One who will stir the hearts of the people, so that the sons and daughters of a given nation strive to emulate their leader’s greatness. Only then will a nation be truly great, when a leader inspires and produces citizens worthy of becoming future leaders, honorable decision makers and peacemakers. And in these times, a great leader must be extremely brave. Their leadership must be steered only by their conscience, not a bribe.”

Suzy Kassem

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