Business Process Improvement - 8 Benefits of Looking Outside Your Industry For Business Ideas

When Henry Ford needed an innovative productionsupermarkets.
model in the nascent automotive industry, he got his4. Benchmarking opportunities
ground breaking idea of using an assembly line fromThe practice of benchmarking (comparing your
the meat packing industry. Since that time, manybusiness processes to your industry's best) is a
fortunes have been built by forward thinkingwell-proven strategy for business improvement.
entrepreneurs who brought in ideas from otherHowever, there is increasing evidence that competitor
industries.benchmarking may leak into the strategy development
"Funnel Vision" is what business strategist Jayprocess and inadvertently lead to a lack of
Abraham calls this entrepreneurial ability to pull indifferentiation. Benchmarking to companies in
business ideas from other industries in a way thatalternative industries may be a way to gain the
creates new competitive advantage.benefits of such comparisons while avoiding the
1. Find new approaches to certain problem areasstrategic pitfalls.
Certain intractable problems that are industry-wide5. Development of a learning organization
challenges may be overcome by looking outside yourA learning organization is a more dynamic organization
particular industry. When Henry Ford developed histhat has a greater ability to continually transform itself
assembly line model, he ushered in a new paradigmbecause it facilitates the learning of its individual
that broke the trade off between quality and cost.members. Actively encouraging your employees to
Before Ford, the automotive industry employed onlydevelop "funnel vision" is a great way to build the
expert craftsmen who custom-built cars that only thecompetitive advantages that are inherent to a learning
wealthy could afford.organization.
2. Insight into new or impending challenges6. Avoiding collective organizational blind spots.
In 1997, former Intel CEO Andy Grove heard how U.S.A collective habit of scanning through indirect
Steel lost its dominant position to upstartcompetitors can also act as an early warning system
manufacturers of "rebar" (cheap, concrete-reinforcingthat protects against strategic business risks like a
steel). U.S. steel had originally ceded the low end of themarket convergence. For instance, very few day spas
market to these manufacturers, but those theytoday realize that their allergists and dentists are likely
eventually encroached to compete in higher endto be their most common competitors in a fast
products.converging future.
Grove seized on the metaphor by declaring low end7. Find opportunities for expanding the market.
PC processors to be "Digital Rebar" and guided Intel onLooking outside your industry may help you open new
a preemptive strategy to manufacture Intel Celeronmarkets for your products and services. One of the
processors. This protected Intel from competitormost important soft innovations you can come up with
domination of the lower end of the PC market.any business is the ability to identify new market
3. Improving existing practicesspaces for exploration.
Most businesses and most industries share the same8. Potential for finding new partnerships and alliances.
core processes in common. Whether those processesIn addition to all the benefits above, regularly scanning
are strategy, people, production or budgeting, there isexternal industry spaces can help you identify
always a strong possibility for extracting improvementscompanies to establish partnerships and alliances with.
from other industries. Taiichi Ohno, the foremostStrategic partnerships are some of the most
pioneer of Toyota's famed production system iscost-effective and powerful ways to grow regardless
supposed to have invented the Kanban system afterof the scale of your company.
observing the shelf-stocking procedures at U.S.