London Business School recognises real innovation
Remarkable business people who have been doing some truly remarkable things attended the prestigious London Business School Real Innovation Awards virtually.
Every year, two winners are chosen for each category – the People’s Choice (voted by public ballot) and the Judges’ Choice (selected by an expert judging panel). In 2020, the first-ever virtual ceremony was on the Innovation in Adversity theme, a current topic that many of us are facing today. This year also saw the introduction of a new category with the same name to recognise the efforts of the people and organisations who have launched or continued to run their businesses and services in the face of a crisis like the current global pandemic.
Accidental discovery
Named after the man who accidentally discovered penicillin, the Alexander Fleming Serendipity Award recognises an individual or organisation whose business is based on an idea that originated in the most surprising way. The People’s Choice award went to Swiss Vault Systems for its modular data-storage system that enables hospitals to achieve an 80% reduction in electricity consumption and a 90% reduction in space.
The Judges’ Choice in this category was Instabug, an ingenious tool developed by ex-Cairo University students Omar Gabr and Moataz Soliman that enables app developers to get direct feedback from users, greatly reducing the time taken to fix software bugs. The reason it got the judges’ vote was the entirely accidental discovery of its real utility. The original business concept was an app-testing website that used crowdsourcing to get feedback from users – but, as Omar himself said, “People really hated it!”, and it was only when the founders pivoted to develop the instant-feedback feature that the app took off. It was crucial for them that they didn’t get too attached to the initial product and acted on user feedback. When asked about his thoughts on how one should think about innovation in these particular times of crisis, Omar mentioned that since the future of work is different, it is important that founders focus on the new trends, new habits and the new normal, anticipating the future to build products that would cater for this.
Disrupting for the greater good
The Best Beats First award pretty much does what it says on the tin, recognising a company whose superior business model enabled it to outdo the incumbents. The People’s Choice here was Trinidad and Tobago-based Term Finance Holdings (TFH). Founded by Oliver Sagba in 2015 with just one other employee, TFH now disburses over 1,000 loans every month and manages around £7 million a year – staggering figures for a company that has never had a single face-to-face meeting with a customer.
The Judges’ Choice award went to language-learning app Duolingo for the sheer self-belief of founders Luis von Ahn and Severin Hacker and their innovative online business model, which has seen the company become market leader in just six years by completely disrupting the industry. Duolingo UK General Manager Colin Watkins said: “We started with a desktop version, but Duolingo only really took off when we launched the mobile app. The principle is to make language learning more broadly accessible. It can be used anywhere – the product is free and always will be.”
Rachel Bell, one of this year’s judge said: “Duolingo demonstrated that a superior product and an innovative business model could displace then market leader Rosetta Stone in an already crowded and mature marketplace. The mass-market product captured the market for both B2B and then pivoted to B2C. In 2019, valued at one $1.5 billion, this unicorn now dwarfs its nearest competitors."
Perseverance till the end
Named after the Irish playwright who memorably said: “The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself [so] all progress depends on the unreasonable man”, the George Bernard Shaw Unreasonable Person award recognises someone who has made it against all odds and expectations. The 2020 People’s Choice was Abbas Dayekh, founder of Nigerian home delivery company OyaNow. Abbas eventually secured funding from a Swiss investor to get off the ground, but had to overcome many barriers in the shape of talent scarcity, technical problems and customer cultural resistance just to get to launch stage – a true tale of tenacity in the face of adversity.
Tomilola Adejana, CEO and Co-Founder of Bankly, took the Judges’ Choice for unreasonableness – but in her case the unreasonableness was external, rather than within. Tomilola experienced great cynicism and no little misogyny from the banks, regulators, telecoms companies and investors she needed to get on board to launch her digital financial services platform for Nigeria’s ‘unbanked’ small businesses and casual workers. But she refused to accept rejection and eventually took Bankly live in July 2019 – making her a worthy winner of an award named after someone who was a noted advocate of women's rights.
“Tomilola saw a huge problem for the 58 million unbanked in Nigeria – as they save, they often have money taken in fees or fraud. This problem was only part of her challenge; she faced a culture where often only men are taken seriously, and venture capitalists thought she had no chance against the circling telecom giants. Now live and in its second year, Bankly is award-winning, growing fast and proof that being reasonable is much overrated.” said judge Charlie Dawson.
A different perspective
The popular vote in the Harnessing the Winds of Change category went to Avataar.me for its augmented reality technology that converts photos and videos into 3D product-discovery experiences, while Lemonade Insurance won the judges’ vote. The expert panel was taken by the innovative business model, which disrupts the traditional insurance model by allowing customers to pool insurance premiums with other customers and donate any ‘excess’ to charities of their choosing, allied to the way in which Israeli entrepreneurs Shai Wininger and Daniel Schreiber conceived a way to ally insurance with a social good.
The key to this innovation was that the founders knew nothing about insurance. As Yael Wissner-Levy, Vice President of Communications at Lemonade puts it: “Sometimes when you know too much of a certain subject it actually confines your thinking and when you look at it from a different perspective you suddenly think of things that no one else within could have thought of or could have thought that was possible.” And that is exactly what happened at Lemonade.
Judge Sarah Wren said: “Lemonade has adroitly harnessed consumers’ demand for a slick, digital experience, alongside a socially impactful model. A great example of harnessing the winds of change: innovation that is improving customer experience, generating sustainable margins, and doing good.”
Learning from failures
Field Intelligence took the popular vote in the If At First You Don’t Succeed category for the pharm-tech platform Shelf Life that enables provision of quality medicines and micro-credit to almost half a million patients in Nigeria. The Judges’ Choice winner was Arth, a project run by a team of students from the Indian Institute of Technology in Delhi who developed clean-energy biomass ‘logs’ made primarily of cow-dung for use in cremations to help tackle India’s huge problems of deforestation and air pollution. Awards ceremony co-host and Professor of Strategy and Entrepreneurship Julian Birkinshaw said: “Arth deserve this award in so many ways. In three years’ time, their logs will have saved 2.3 million tonnes of carbon dioxide and 4,500 tonnes of methane, and will have generated around £4 million in wages for the local economy. They will also have significantly impacted water pollution by disposing of cow dung more hygienically and efficiently.”
Innovating in a crisis
The 2020 ceremony featured a new award, for Innovation in Adversity. It was no surprise to see the team from Warrington and Halton Teaching Hospitals NHS Trust who invented the ‘Black Box’ to treat Covid-19 garner both the people’s and the judges’ vote in the new category. A modification of an existing machine used to treat sleep disorders; the invention performed so well that the hospital region has the lowest Covid-19 mortality rate in the north-west of England. Implementing this innovation required cross departmental collaboration where teams of doctors, nurses, physiotherapists and allied health professionals from the Intensive Care unit, High Care Respiratory ward and the Cardiorespiratory team worked together for a common goal: overcoming the crisis.
Jeff Skinner, Executive Director of the Institute of Innovation and Entrepreneurship said: “The innovation at Warrington and Halton Teaching Hospitals was remarkable on three levels. First, the original innovation, which was developed at speed by consultants in two different areas who came together ‘bottom-up’ to create an entirely new pathway for treatment of Covid-19 patients, resulting in far fewer being put on ventilators and leading to significantly improved outcomes. Second, there was a remarkable ‘top-down’ management innovation within the hospital, clearing a way through the normal administrative and financial burdens and providing the freedom and ‘air cover’ for clinicians to do what they knew was right. Third, the speed with which technical specialists and engineers came together to adapt the CPAP (continuous positive airway pressure) equipment – at scale – to be used in a different way. This is innovation at its best: an organisation overcoming deeply ingrained behaviours overnight, reconfiguring itself and reallocating resources to address an impending crisis.”
The judges added: “In the teeth of the Covid-19 crisis in a regional hospital on its way to being overwhelmed ... was definitely adversity. The response was practical, smart and fast. [The team] described it modestly as ‘just doing our job’. The results were way beyond such understatement.”
Faculty Insights
The ceremony also featured LBS faculty sharing their thoughts on why adversity seems so often to be the wellspring of innovation. Rajesh Chandy, Professor of Marketing and Co-Academic Director of the Wheeler Institute for Business and Development, said: “Some of the most inspiring new ‘inventions’ I have seen come from the grassroots. It’s not really about a new invention so much as user-generated, bottom-up modifications to an existing design. It’s really adoption of innovation rather than a substantial new invention – and often in sectors and places that have not seen much change in decades or even in centuries.”
Associate Professor of Strategy and Entrepreneurship Garry Dushnitsky had a thought-provoking response to the same question: “When thinking about how adversity stimulates innovation, you need to be very mindful of the role of uncertainty. When were you most impacted by uncertainty? Was it the day before you learned of the Covid pandemic, or the day after? Uncertainty looms high prior to disruption, and what you really want to be mindful of is how to prepare for that uncertainty.” He suggested the use of scenario planning to prepare for the future.
Luisa Alemany, Associate Professor of Management Practice in Strategy and Entrepreneurship, had this insight: “Adversity makes all of us a bit scared initially. Our first reaction is not positive – we want to stay at home and protect ourselves. Then we ask ourselves, ‘Do we want to stay like this, or do we want to do something about it?’ It’s then that we try to make the situation better.”
Michael G. Jacobides, the Sir Donald Gordon Chair of Entrepreneurship and Innovation and Professor of Strategy and Entrepreneurship, said companies needed to be mindful of the “3Rs”. He advised: “You need to recalibrate growth opportunities, reconfigure the business model and – most important of all – reallocate capital coldly and boldly. Firms today are understandably focused on cash flow and survival but, when everyone else is busy cutting costs, laying the foundation for a new competitive position with a few bold and well-targeted investments can generate a significant post-Covid rebound. You need to rigorously re-evaluate your capital spend in a way that balances short-term viability against longer-term prosperity.”
Summing up the awards, Julian Birkinshaw said: “Every year, the Real Innovation Awards seem to reveal another facet of the human spirit. In the ‘year of Covid’, they have shown us how sheer necessity is often the mother to invention – and how local innovation can make a huge difference to people’s lives. Real innovation is not just about visionary leadership or amazing new products. Yes, it’s about ingenuity, know-how and creativity. But it’s also about basic human qualities such as resilience, bravery and determination. And, particularly in times of crisis, it’s about empathy, sense of community and our shared humanity, and everyone at London Business School feels privileged to witness the efforts of so many entrepreneurs to make the world a better place for us all.”
To see a full recording of the Real Innovation Awards 2020, the interview with Omar Gabr, Founder of Instabug, Faculty Insights and further resources including Michael G. Jacobides’ research piece and presentation of his framework ‘Rethink, reconfigure, reallocate’ click here.
