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What's behind every industry-shaking innovation? Countless, but crucial, "mini-innovations," as Joe Fox calls them. Along with his brother, Avi, Fox has founded two companies -- in entirely different industries -- that aimed to challenge the traditional business models. But in an interview with MIT Sloan Management Review, Fox explains that these large-scale innovations don't dawn on him all at once. Instead they arrive in fragments, some of which are conceived by his management team of original thinkers. The Fox brothers set the group to work after they've spotted a broader opportunity, which happens when they aren't looking for one. Their first business, an online brokerage called Web Street, grew out of their own experience trading equities. And they constructed the framework for BuySide Realty, an online real estate brokerage -- which they currently operate, along with a subsidiary called Iggys House -- when prowling around for a vacation home. After the initial inkling, Fox's market research consists not only of asking potential customers, but also of actually paying attention to their answers. What he's looking for is not their opinion of whether an idea can possibly be executed; he just wants to know if they would pay for such a service, assuming he could bring it into existence. Not that he's had an easy time bringing a notion to fruition. He's never been able to strike a deal with any institutional investors, although Web Street did successfully go public during the dot-com boom in 1999. He had hoped to repeat that feat with his current venture last year, but opted to wait for Wall Street's appetite to improve. In the meantime, Fox is counting on a steady supply of "mini-innovations" to keep the business ahead -- by a half-step, at least -- of its megacompetitors. Can he do it? Clearly, he thinks he knows how.

Group brainstorming excels at generating both very good and very bad ideas.

Researchers hope a new Web-based platform will enable better deliberation on complex problems.

Despite the general understanding that leaders learn from experience, only a few organizations, such as Toyota, Boeing and General Electric, have truly taken it to heart by putting programs into place specifically to take advantage of experiential learning. Most companies stay within a narrow comfort zone. They certainly encourage aspiring and emerging leaders to "get experience," to take on "stretch" assignments and to take risks. But they provide precious little guidance on how to learn from experience -- how to mine it for insight about leading and adapting to change over the course of one's life. Organizations generally don't look outside their industry, or business itself, for new approaches. Instead, a banking model of learning predominates -- a semi-industrial process in which cost per unit is the key performance measure and knowledge is something deposited in aspiring leaders' heads for later use. That is unfortunate, because organizations are missing the opportunity to develop leaders by integrating their life and work experiences, especially those experiences the authors call "crucibles." Crucible experiences can be thought of as a kind of superconcentrated form of leadership development. Surprisingly, the best examples of organizations that deliberately employ such alchemy do not come from the business world. The authors draw on lessons from The Church of Jesus Christ of Latter-day Saints, better known as the Mormons, and the Hells Angels Motorcycle Club to develop four lessons for helping to develop managers. First, both the Mormons and the Hells Angels demonstrate how it is possible to craft or convert core activities to serve as practice fields for leaders. Second, they engage in elaborate preparation before sending would-be leaders out into the field. Third, they provide a supporting infrastructure while members are in the midst of a crucible. Finally, they recognize the need for renewal in individuals and the organization.

Thanks to a variety of online social applications -- including blogs, social networking sites like MySpace, user-generated content sites like YouTube and countless communities across the Web -- people are increasingly connecting with and drawing power from one other. In fact, customers are now beginning to define their own perspective on companies and brands, a view that's often at odds with the image a business wants to project. But organizations need not be on the defensive. Indeed, some savvy executives have already been turning this groundswell of customer power to their advantage. To investigate how, the authors interviewed managers and employees at more than 100 companies that were rolling out social applications. From this research, they developed a strategic framework that businesses can use to implement social applications in a number of departments, including research and development, marketing, sales, customer support and operations. The potential benefits are numerous: Social applications can generate research insights, extend the reach of marketing, energize sales efforts, cut support costs and stoke the innovation process. (And for companies that tap into employee groundswells, the result can be increased opportunities for collaboration across departments and geographical locations, as well as greater productivity and decreased inefficiencies.) But the greatest benefit might be cultural, because social applications help weave two-way customer communications into the fabric of an organization. But anything that changes culture tends to face resistance, and this is especially true of social applications, because they require managers to embrace an unknown communications channel, one that responds poorly to attempts to control it. Based on an analysis of companies that succeeded or failed in deploying social applications, the authors have derived a number of key managerial recommendations for any organization attempting to harness the power of the groundswell.

Asia, Latin America and Eastern Europe are delivering strong revenue and profit growth.

It has become accepted wisdom in the corporate world that at one time or another every business will be forced to make radical changes. In fact, there is a blossoming industry of consultants and advisors who are equipped to help companies execute and survive these inevitable upheavals. But the authors propose that there is a better way to ensure that your company doesn't get ripped apart by radical change: Make sure it never needs it. What CEOs don't realize, say the authors, is that they could prevent their businesses from confronting the risks of wholesale change if they knew enough to identify and make smaller changes before too much friction builds up inside the company. Leaders and their management teams must be alert to -- and willing to confront -- early signs that the company's internal culture is not consistent with how it used to be, or how the leadership thinks of it. Making preemptive moves is never easy, because the signs are subtle and do not show up in traditional financial metrics. Shoring up a company's sagging identity is almost never a financial priority on par with, say, buying a new piece of equipment. The authors explain which indicators CEOs should monitor and take seriously (turnover rates, for example, or changes in the profile of new hires) so that they can make rational decisions as they are warranted, rather than waiting until panic sets in and countless changes are unavoidable. Such incremental shifting poses its own challenges: It's hard to convince others to join the movement when the culture in question looks healthy, but doing so will spare the company from the tough task in the future of having to reinvent itself. Given the choice, wouldn't most leaders prefer a low-level struggle with change rather than a fierce smackdown?

Competing in China is the only option for multinationals that want to build or preserve their global position.