Innovation often emerges out of necessity to reach your vision.

It requires insights, pivoting, dread and exhilarating moments of succeeding.

The Innovation Stack: Building an Unbeatable Business One Crazy Idea at a Time by Jim McKelvey is about the journey of building Square, the most successful company in credit card transactions.

Square had an original idea and a very strong driving vision: they wanted to expand the realm of possibilities for those entrepreneurs that were not deemed as acceptable or reliable by the big banks and corporations to handle credit card transactions.

It was a practical problem as one of the founders, Jim McKelvey, lost a sale because he was unable to process the customer’s credit card at his studio.

The original aim of Square then was how to reduce fees and make it more accessible for smaller companies and people to get paid via credit card payments.

So they embarked on a journey that over time built their Innovation Stack.

 

What innovation stack is 

Innovation Stack is not a neatly organised strategic set of options that you choose from; it is not a playbook that explains the steps you need for success.

Innovation Stack emerges from the necessity of solving problems and innovating because you are desperate to reach your goal and vision.

In other words, building an innovation stack happens out of necessity: you innovate, not because it’s your main goal, but because you simply have to:

“The problem solving one problem is that it usually creates a new problem that requires a new solution with its own new problems. This problem-solution-problem chain continues until eventually one of two things happens: either you fail to solve a problem and die, or you succeed in solving all the problems with a collection of both interlocking and independent innovation” (p. 56).

So an Innovation Stack “is not a plan, it is a series of reactions to existential threats” (p. 56).

You innovate because someone else enters the same niche that you thought was yours, offers the same product but with extra features and much cheaper and is set to oust you from the competition and the market.

This almost always happens because if you are highly successful, there are more people willing to copy your idea and brand so they can hit the same market and same customers.

Great work always attracts copycats.

So even established brands are not out of the woods but need to keep developing innovations along the way to survive.

 

You “get” an innovation stack if you leave the city 

Jim McKelvey likens innovation entrepreneurs to the early explorers who left the mainland and sailed off without really knowing what they would find.

He likens the current market to a medieval city with high walls: as long as you are inside the walls and inside the city, there are rules to play by but you also have protection from wolfs that roam the woods and you have certainty.

But innovation entrepreneurs are those who leave the walls of the city and venture out into the woods.

Just because no one has done it before does not mean you can’t but:

“There is always a reason no one has done it, and the reason is rarely that they just aren’t as smart as you. As inventive as you might be, there’s only an infinitesimal chance you are the first person to invent whatever you think you have invented… But that’s fine – clearly, nobody has succeeded, or the problem wouldn’t still exist” (p. 34)

But that also means you are unlikely to find role models or similar companies who are going through similar problems or challenging contexts.

And that means that you just have to innovate and start solving those problems that lead to new problems that lead to new solutions (and new problems).

For Jim, this meant that he had to find mentors and role models from the history, from other industries, from anywhere where people had the hallmark of being inventive and establishing a new market where none existed.

 

Innovation stacks for climate adaptation 

To put it simply, an innovation stack is a series of decisions that build on each other.

It is a continuous play between outcomes and decisions but always challenging the fundamental assumptions how things should be, how a product should look like or behave, or what method you should or can use.

The breakthroughs occur through luck, persistence and courage to keep going.

When you hit a wall, you don’t just stop but either find a way to climb over it or walk along the wall until you find another solution.

In climate change adaptation, we have an opportunity to think in terms of innovation stacks  where we look for something new, and have the courage to be an explorer not always knowing the outcome.

Rather than just stopping at limits, where we think there is nothing more we can do, it is often in those spaces that innovation abounds.

Constraints and setbacks force us to look at the core assumptions of the market, what everyone else is doing, and even copying others who seem to have it figured out.

More of us should embrace “the woods” and work from courage, not fear.

Just because we haven’t done something before does not mean that we can’t.

We just need to be reflexive, pay attention to our series of decisions, and start building a stack of our own.