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Do our innovation investments focus on leveraging our crown jewels, or are we spreading ourselves too thin and failing to achieve genuine competitive separation?
Uncritically following such a course leads inevitably to dilution of differentiation, erosion of competitive advantage, waste of innovation resources on things that don't matter (or more precisely, that don't matter enough), and failure to achieve sufficient competitive separation on the things that do matter.
Groupon's daily deals have achieved escape velocity, but it remains to be seen how sustainable that competitive separation will be.
Microsoft Office had what once was thought to be insurmountable competitive separation, but lately it is getting commoditized by "good enough" alternatives from Google and others, threatening to suck it back into a competitive set.
You must innovate sufficiently to achieve competitive separation.
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