Proactive innovation in the music business: A manifesto

By: Cherie Hu

Published: 2024-07-17

In an era of rapid technological change, the traditional music industry often finds itself in a reactive stance, scrambling to adjust to external shifts.

But what if we could flip the script? What if, instead of merely adapting to change, we became the architects of innovation ourselves?

This is the essence of proactive innovation — not just responding to change, but intentionally propelling it forward. It’s also the core engine of Water & Music’s mission:

… to empower music professionals with the knowledge, insights, and connections they need — not only to navigate innovation, but also to become active participants in advancing the industry forward.

In this guide, we’ll demystify the concept of proactive innovation as we embody it at Water & Music, and provide a practical framework for implementing it in your day-to-day work, regardless of your role in the music ecosystem.

Reactive vs. proactive innovation: Understanding the difference

To grasp proactive innovation, we first need to understand its counterpart: Reactive innovation.

Reactive innovation is the adjustment we make out of necessity when external forces compel us to change.

The music industry has seen many examples of this short-term, defensive posture:

While these reactive measures sometimes lead to positive outcomes and necessary adaptations, they often result in short-term solutions that may not be sustainable or optimal in the long run.

Proactive innovation, on the other hand, involves anticipating future needs and trends — and developing new approaches and solutions as a strategic imperative, even before they become urgent necessities.

It's about asking "What if?" and "Why not?", instead of "What now?"

The practice of proactive innovation requires a persistent critique of the status quo, questioning what needs to improve and what tools are available to drive that improvement. It also requires a certain appetite for risk.

The building blocks of proactive innovation

At Water & Music, we believe proactive innovation comprises three key elements:

I. Knowledge: Mapping markets and systems

You can't innovate in a space you don't understand. The first step in active innovation is developing a deep, systems-level understanding of the music industry and any other landscape you’re operating in.

This can involve:

For the last five years, a core focus of our work at Water & Music has been on building market maps of critical areas and trends in music tech, including:

II. Connections: Facilitating interdisciplinary knowledge exchange

Innovation rarely happens in isolation. Some of the most groundbreaking ideas in business come from cross-pollination between different fields.

In the music industry, this might involve:

At Water & Music, we regularly apply frameworks from outside industries to music, as a catalyst for unearthing new opportunities across marketing, partnerships, and business models. Key examples include:

III. Pathways: Developing strategy and action templates

In a world awash with information, knowledge alone isn't enough to succeed. You need to know how to translate that knowledge into actionable insights.

This is where strategy and action templates come in — codifying project-level insights into replicable structures that lower the barriers to experimentation.

These templates might take the shape of:

Examples of such templates we’ve built at Water & Music include:

Implementing proactive innovation: A practical approach

Some of you may be thinking: “OK, but how do I actually do this?”

We recognize that embracing proactive innovation can be challenging, especially for organizations that are naturally risk-averse or operating with limited resources. With its entrenched, well-established structures and complex stakeholder relationships, it’s no surprise that the music industry is often resistant to change.

However, we believe there are several concrete, accessible ways to incorporate proactive innovation into your work, regardless of your position or the size of your organization.

Start small and low-risk

“Innovation” doesn’t have to mean massive, disruptive change overnight. Begin with small, low-risk projects that align with your current goals and available resources, which will allow you to experiment and learn without jeopardizing core operations.

Depending on who you are or where you work, this could take many different forms:

Emphasize learning and iteration

It’s important to frame experiments as learning experiences, rather than merely high-stakes gambles.

Create safe, collaborative spaces for experimental ideas

Designate specific times or spaces where new ideas are encouraged, and where failure is viewed as a learning opportunity.

Collaboration and external partnerships can help distribute the risks and costs of innovation while still bringing in fresh perspectives. Today, there are several industry consortiums, working groups, accelerators, and directories focused on music-tech innovation, including:

In conclusion: The proactive innovation mindset

Futurist Amy Webb has noted in her work that the future doesn’t just “happen” — it's actively being created in real time by the actions we take today. This concept is at the heart of proactive innovation, which is ultimately more than a set of tools; it's an entire approach to thinking and working.

This mindset involves:

  1. Anticipating trends and needs before they become urgent
  2. Questioning established practices and seeking new solutions
  3. Learning from failures and adapting quickly
  4. Drawing insights from other industries and disciplines

In today’s dynamic music-tech landscape, the next industry breakthrough could emerge from anywhere — a major label, a tech startup, or an independent professional working at home. Your daily decisions and actions, no matter how small, contribute to this industry-wide evolution, and a proactive innovation framework can help chart a clearer path from ideas to impact.

At Water & Music, we're committed to supporting your journey in proactive innovation. We provide the knowledge, insights, and connections you need to run more informed experiments in your day-to-day work, learn from others’ collective experiences, and transform your cutting-edge ideas into reality.

When it comes to the music business, perhaps the best way to predict the future is to create it yourself.