The Game-Changer by A.G. Lafley And Ram Charan Is The Most Important Book On Innovation Out There.

Go buy The Game-Changer: How You Can Drive Revenue And Profit Growth With Innovation by A.G. Lafley immediately. Lafley, the remarkable CEO of Procter & Gamble, gives us the state-of-the-art in innovation. It tells you exactly what the best practices are in the one non-techie company that has embraced innovation as a total corporate strategy and as an organizational culture.

Lafley and Charan trade off chapters and sections but I admit to seeking out Lafley’s insights much more as I turned the pages. We’re kind of heard about Nokia and Lego. And Lafley gives us interesting detail for P&G.

Lafley gets to the heart of innovation today—consumer culture. He argues that, yeah, all companies, and especially companies such as P&G have always been focussed on the consumer. But NOT ENOUGH. Today, companies must be consumer-centric, consumer-driven and consumer created. To do that, managers must be one with the consumer culture. They must be anthropologists and sociologiest and deeply understand the myriad of consumer cultures around them. P&G has a Living It program where people live with their consumers for a time. It also has a Working It program where P&Gers get into shops and sell to consumers. Both immerse company people in the lives of their consumers.

Now here's another Big Thought. We are creating new consumer cultures at a tremendous rate together, thanks to social media. Each is different and each requires P&G and every other company to understand it. Thanks to technology, companies now have access to villages and cultures and languages all over the world--and they need to understand those "old" cultures.

Thanks to technology, new "villages" are created every day by like-minded people linking up to talk and do things. Mommies with blond twins in Nevada--or anything. Companies have to understand these "new" cultures.

And here's a final--and second Big Thought. The US used to be the center of the world. It didn't need to understand other cultures. It exported its culture to the rest of the globe. Other people in Asia, Europe, Latin America, the Middle East, Africa needed to understand American culture to succeed.

That's all over. For many reasons, economic, financial and geopolitical, the imperium has ended. The euro is equal to the dollar. Asia is rising. Power is distributed, not centralized. Growth is faster outside the US. Whatever.

So global corporations that are US-based, must now learn the cultures of the world, as well as the cultures of the internet.

This is why innovation is growing in importance today. It provides the tools to deal with this changing world.