GUEST POST from Paul Hobcraft

We tend to ignore the change part of innovation

I believe we need to rethink this and evaluate the significant changes that should be taking place within our internal organizations as we expand our innovation activities.

A classic change model needs an update- Lewin’s change model

• We need to ‘unfreeze’ through recognition of our present rigidity >
• We should make a ‘transition’ through experiment and exploration >
• Finally we should not ‘refreeze’ as the recognition of past views have offered, we need to build the adaptive, agile and fluid needs for today of learning, collaborating and embracing change. We simply cannot refreeze.
  

We need a ‘C’ change to always sit side-by-side with innovation

Innovation is always like a change project, it needs to be mapped out, assessed and change built in, it needs thinking through in its impact so as to relate and identify with all that does occur within any innovation adoption.

Finding the “C” in innovation is all around us, in all we do

For this post let’s take a “lighter” look at the importance of the ‘C’ we need to find in our innovation efforts

So thinking “C” is central to innovation- we actually find it everywhere

I’ve spotted so many C’s in our innovation need. Let me provide some of these here:

This is made up of the search to build a common language, to put innovation in its appropriate strategic and operational context, to work on communicating and cascading this throughout the organization, so as to build the culture, climate and conditions innovation needs to work on challenging and sometimes complex issues.

We consistently need to provide the clarity that all need to contribute so this ‘broader universe’ can spark the distinctive aspects of cultivating curiosity and creativity that has the greater potential of being converted into the innovation that delivers on its capital in the potential promise to captivate our customers.

The ultimate aim is building identification and understanding so as to build up the capabilities, capacities and competencies required to deliver on the integrated approach taken. This is led from the top through a well-designed approach and then fully conveyed down on the needs throughout the organization for all involved to align and bring innovation to life, to spark curiosity, co-operation and collaborative exchanges, to combine ideas, to be capable to build on these and take them forward in coherent, thoughtful ways, offering calculated returns.

What we design needs to seeks out to capture and encourage engagement, we need to crystallize new concepts, construct and commercialize solutions and be the providing catalyst for sustaining change and growing confidence, connecting our people, converting and clarifying, convincing all our respected communities of innovations value, of its growing critical importance and vital contribution to influence and determine future growth as well as creating the conditions for sustaining and improving the organizational longer-term prospects of lasting competitive advantage.

So have you had your daily dose of the critical vitamin C compound that comprises much of what we need for our innovation good heath?

Can you appreciate the “C” in innovation?

Finally from me, a Ciao from Southern Switzerland

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GUEST POST from Paul Hobcraft

If someone came to you and asked the question: “tell me what makes up your financial capital?” I expect you could answer this fairly comfortably. It might need a little added help from your finance department but you could produce and show significant details that we are all ‘schooled’ to understand and generally have accepted, as under common definitions and standard practice.

Our businesses are measured constantly on their financials, we produce a constant flow of reporting documents that provide useful insight and allow for a more informed judgement by present and future investors on the health of the company. We are ‘wedded’ to our financials and ignore the real value within our organizations of all the other critical capitals that generate and strengthen the business.

What if that same person came to you and asked instead: “what makes up the innovation capital of the company?’” could you answer this as clearly as the financial one – I would suggest most probably not. (By the way, if you feel you can then please let me know I would be more than interested). We are focusing more on past performance and not future generating potential by staying fixated on just the financials within all that makes up our organizational  capital.

So what makes up our innovation capital and why is it important to know?

Should we care, does it matter? I would argue it does, increasingly so. Within the innovation capital lies the future of the organization and holds one of the real golden keys to the sustaining performance of the company, or not.

The generally accepted view is that Innovation boosts a company’s earnings, speeds growth, ensures an advantage over competitors, and greatly appeals to shareholders. Put another way, businesses that deliver earnings growth based on a continuous stream of new products and services and new ways of doing business capture the innovation premium.

So tell me, why are we seemingly so bad at identifying what actually makes up our innovation capital, apart from some sweeping generalised statements attached in the accompanying comments within the financial result statements?

We need to find a way to unlock this as we are constantly being pushed for new business models that create, deliver and capture value. It is in  the entire make up, the value structure around the offering, and this is made up of distinct capitals that drive the new business towards success.

How do I define innovation capital?

“Innovation capital is the sum of all that promotes the development and changes required for achieving innovation outcomes, within one organization or its broader networked environment, for market place advantage”.

“These are made up of the resources, processes, knowledge and capabilities, that are constantly evolving and highly dynamic to build greater innovating capacity.”

These innovating capitals build upon the capabilities of ‘sensing, seizing and transforming‘ so as to build new capital that focus more upon the dynamics capabilities within innovation. You are searching for what makes-up and provides the true value creation in successful outcomes; in final product, services, knowledge understanding or executing within further business models”

We need to understand what makes up innovation capital far more in the future.

Mostly this innovation capital comes from the different intellectual capitals, those unique sums within each organization, of knowledge made up of our human assets, organizational structures and social partners making up the organizations eco system.

It is when we bring these together in different, evolving ways we transform the knowledge into new economic value, through this organization and personal actions. Financial capital cannot do that, it can only fuel the other capitals.

We are also highly vulnerable unless we know what makes up our capital stock.

Financial Capital is useless on its own to generate growth unless it has its ‘feeding stock‘ and that is within the other capitals.

It is the ‘stock’ of these that generates the values. It is these unique bundles of a organizations resources and assets that give us our new innovation value, through the process and flow of knowledge and its creation, leading to commercialization. We need to constantly create fresh innovation capital.

It is the dynamic interactions and flows between the different innovation capital assets and the other intellectual assets that innovation requires for successful activity and outcomes.This is where absorptive capacity plays its vital part in structuring this process.

The hard part is valuing innovation capital as these are constantly being renewed and evolving.

Innovation capital is a set of renewal capabilities and understanding what these are is critical but today is not well understood. We find it extremely difficult to report clearly on the makeup of our innovating capital yet investors are increasingly attributing more to the intangibles, based on limited knowledge.

Determining and being able to articulate the value within these capitals would be truly valuable and would help us differentiate between those that are static or simply repeating, and those that are dynamic, ever evolving, searching for new knowledge.

How can we capture and articulate the innovation capital?

So the key to identifying innovation capital lies in its stocks and knowledge building assets and their uniqueness in the resources that make this up, in constantly evolving and learning, these are the a real strategic asset. Leveraging the ‘stock’ of our innovation capital can render different productive value outcomes.

It is our ability to ‘mix and combine’ the innovation activity that it consists of, in all the decisions and activities that occur, from the recognition of a need or a problem, through research, development and commercialization of an invention into successful market outcomes builds the capital.

Knowing this make-up of our innovation capital provides us the potential for driving our future growth. Identifying the real capital that will drive and sustain real advantage, providing the future potential for new wealth should be the essential way we measure organizations performance, not on past financial performance or personal perception, built on limited understanding.

We need greater insights into all our organizations ‘collective’ capitals

It is the ‘combination effect’ of leveraging all our capitals that yields the real lasting sustaining values. Today, we are lost in numbers and details, financials dominate most discussions.

We rely too much on historical numbers, alongside a judgement of the rhetoric offered by the board about the promise of future performance. Judging innovation’s performance is based partly on current product launches and announced future pipeline where the board is typically cautious. It often makes us as those investors equally cautious. We need to know more on what can and does ‘drive’ future performance that lies at its core or is being built in new capabilities and capacities.

Until we can peer under the organizations hood a little more and understand the make-up of all the capitals then we will continually fail to understand the real innovation activity that generates the value and we will always have a lack of measuring an organizations performance in any comprehensive way.

We need to really understand what does make up our innovation capital. Do you?

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GUEST POST from Paul Hobcraft

Today, we are in need of a different sustaining capacity, one build around innovation as its continuous core within our corporations; constantly evolving, adapting, learning and adjusting, in perpetual motion.

We are heading for transformational change

Digital technology and the cloud are offering us a radically different conduit to achieve a new engagement process within our organizations. Innovation is going to be very much caught up in this transformational change.

Technology and data will be innovation’s catalyst for change

Digital technology is prompting us to find new methods and manner to shape our environments; these will alter much of what we do around innovation, in radically different ways. We will be able to amplify far more of what is going on in real-time, we can capture and explore all the interactions to understand their potential value, we can discover greater individual needs, exchange and extrapolate better, simulate and experiment, all at a growing scale and speed.

The predictable, well-established ways of the past within our innovation processes will be inadequate to cope. We will require solutions moving towards this very different, constantly adjusting future; one of experimentation and exploitation, delivering solutions that meet changing market needs.

We need solutions and processes that require a greater alignment in the practices of innovation, constantly adapting, being fluid, flexible, nimble, agile and responsive. Ones that is capable of delivering far different, more dynamic environments to adapt and respond within, so as to capitalize on this new way of working within our innovation activities.

Designing engagement platforms

Not only will we need a new innovation management system, we will need to build this on multiple engagement platforms. Our growing pressure is to find solutions that offer a cohesive and business-focused approach to the new socially enabled enterprise.

The need is to design these engagement platforms where we seek collaboration and sharing at scale, tapping into a multiple array of communities and advocates that have valuable data for organizations, so they can analyze and interpret this. In return the innovation outcome delivered back are value propositions that meet those needs and understanding.

This ‘marriage’ of digital and technology with the physical output of innovations will make it new growth core. Our need is to think through its process, structures and design, as it may have real conflict if we don’t change our present thinking around the management of innovation.

We all know Innovation sits outside the organizational ‘norm’ today

Innovation challenges much of what organizations believe they want: those repeatable systems, so that our organizations performance is well-oiled, highly structured and maximizing value by striving to be efficient and effective. Innovation often is in conflict with this.

Innovation requires increasing agility, flexibility and allowing creativity to flourish. Innovation often stays outside the mainstream system structures, often to the organizations detriment as it often does not fit the ‘norm’. This is today’s innovation problem.

Innovation needs to be fluid, open, responsive; sometimes reliant on the instinct, hunch or powerful insight that is never ‘predictable’ but suddenly emerges from a collision of events, or random thoughts that lead to a new insight, a game changing one. It is really hard to turn this ‘randomness’ or serendipity into a system but certainly not impossible.

We need to renew organizational engagement

Many, if not most of our existing systems, will need radical redesign. Much has to change, be uprooted and completely revisited to begin to design a new digital and physical integrated into the system.

Today, digital and physical work at really different speeds, how will we cope with this growing viarance?. How will they see different patterns and opportunities and try to fit these into a clear view of the world that ends in new innovation? Can the innovation pipeline cope with even more business opportunities? The human mind-set will need to re-orient to receive new digital information in ‘informing’ ways.

Innovation throughput will need different approaches than at present. The innovation pipeline today is very manual; it needs human intervention, in decisions, in inputs, in what is communicated, what is approved or dropped. Innovation gets often weighed down by much unnecessary human intervention.

We will need to transform much within our systems but more importantly to orientate our skills to receive, translate and diffuse new knowledge, in significantly different ways.

How can we connect, enable and deliver better innovative outcomes?

External insights and Intelligence will not become Enterprise knowledge that flows without real, deep integration. Receiving the knowledge alone will not turn these into higher scale, richer, more innovation business outcomes, which have real growth value, unless we realize this pending and massive ‘mismatch’ between digital flowing in and the physical process attempting to cope with this to respond with tangible outcomes.

Market trends are changing faster and becoming shorter, so opportunity windows are narrowing. Risks of missing out are constantly increasing for those who are not focusing intently on that critical ‘time to market’ and not constantly streaming their innovation system, looking to automate it where ever they can.

What happens when all this digital knowledge and insights starts hitting our desks, having to work through an ongoing manual or semi-manual system, when we are seeking to capitalize on a ‘breaking’ opportunity? It will be a real choke point that will become a crisis – a real burning platform to be resolved.

We need to begin to really think though this as a complete redesign for innovation to cope

It cannot be a simple ‘bolt-on’ job, it needs a radical redesign. We should grab this ‘moment of time’ to think what a new innovation system will need to achieve, fit for the post-digital age, how it should look, feel and operate like.

Organizations will be in their search for understanding what needs to change within their innovation systems, as soon as they realize that today’s design can’t cope.What is needed depends on how organizations ‘embrace’ digital. It will need a real depth of understanding and working through

The pressure for a new business core is building – what will change?

Combining technology and innovation will seriously challenge all of us differently:

• Our mental capacity and physical adroitness will continue to multiply through digital technologies and the need to be far more agile in responding.
• Yet equally our whole domain expertise we know today will eventually be stripped away and replaced by something else based on ‘collective’ knowledge.
• Somehow we will need systems that help us manage the physical world of innovation with the constantly changing and informing digital world that each of us will need to be ‘pulling’ together in different ways.
• We will need to blend intelligence and experience that we need to share will need new ways of networking and exchanging around these ideas and insights into tangible values that fit with the organizations goals.
• As data flows in we will need to rationalize the risk decision-making in real-time, adjusting risk with opportunities on a constantly changing basis, as our intelligence and knowledge flows update us with more informed understandings..
• We can look to insights as possibly better predictions of success by lessening the risk factors of no knowledge being replaced by emerging knowledge based on latest insights.
• We will be able to explore the ‘worlds’ trending on those topics relevant to our needs, knowledge and innovation thinking and bring these into our physical environment to adjust our development process.
• We will consistently discover the unexpected and the surprising and we need to be ready to adjust our thinking and capitalize on this quickly, before others come across it. We need high levels of agility and responsiveness.
• Through constant validation we can consistently confirm or question the business case, we can test hypothesis and experimentation in real-time, in multiple scenarios and options.
• Having data, creating a history you can be equally be more backward looking to judge success and failure to learn from these to intelligently improve going forward.

The host of changes are happening at increasing speed

There are a host of significant changes about to occur, to build more of the dynamics of innovation into our management in radically different ways. These will bring about radical changes in the ways of working innovation, so as to align and extract digital knowledge and ‘fuse’ this into the design process of the physical for final tangible outcomes.

The combinations of social, big data analytics, computing anywhere at any time, the cloud, collaborative platforms, connecting the virtual world with the physical worlds will change how processes and whole industries will work.

It is how we blend the new business model of service with ‘adaptive’ technology, processes and people, both inside and outside our organizations will fuel success or speed up decline.

What surely is clear is that  innovation simply cannot remain on the periphery, it simply has to become the new core of our organizations.

Today’s innovation engine is not fit for tomorrows purpose

We are dealing with a completely different set of mind-sets, skills, procedures, governance, processes and responsibilities as we adjust to digital, social and technology advancements. To gain from the digital evolution taking place we need a robust, comprehensive and radical overhaul of much of what is going on within our organizations in relationship to innovation and its management.

We need to not just adapt our processes and structures, but radically challenge them to grab this opportunity to change our innovation processes, so we can provide a more agile and fluid environment. We should be thinking through our needs of the what, where and how we set about constructing this now.

There is a time to change it and that is NOW

A radical newly designed Enterprise-wide innovation process, that ‘sits’ in the cloud seems to hold the key in my opinion, embracing and adapting constantly to all we have been learning about how innovation works and what technology, digital, networks, relationships and social streaming brings that all needs to be fully integrated within this redesign. Do you agree?

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GUEST POST from Paul Hobcraft

The innovation process and the structures build into our organization certainly need to be changed. Innovation is not delivering, our innovation systems are breaking down.

Our current structures and processes for innovation are holding us back and will continue to not deliver the expected results needed today or the future, giving real growth and sustainability. We do need a far more radical approach to a solution for managing innovation inside our organizations.

Poor collective leadership of innovation, functional design, slow decisions and innovation not being focused enough, along with a lack of appropriate skills or decision empowerment, are some of the inhibitors around innovation today.

Eight massive gaps we are failing to bridge:

(1) The constant strategic innovation breakdown

The primary reasons for the breakdown in the strategic planning process that fails to connect strategy with operations are:

• A disconnect exists between corporate strategic plans, which typically define the company’s targets for growth, and their day-to-day execution activities.
• The annual operating plans are quickly out of date due to constant changes in market, product, technology and competitive situations.
• The connection between corporate plans and the innovation strategy for new product development and product innovation strategy doesn’t exist in most companies – this is one critical gap.
• The operational side of the organization frequently doesn’t understand the strategy or how its execution connects to business goals.

We forget to alter our ‘thinking’ across different opportunity horizons, to direct resources around those innovations that address (a) the burning needs to improve on the existing here and now, with those that can build into the (b) next  and different winning positions and finally, those that (c) explore fundamental different premises that can (radically) alter your innovation landscape.  Mapping across all three is often missing, we stay trapped in the ‘here and now’ mindset far too much.

To achieve consistent, sustainable long-term growth and profitability in your company, you must have systems and processes in place to close this gap and connect your corporate plans with innovation strategy and operational activities.

(2) Our planning sucks, how can we be more responsive?

There is the fashionable argument that you abandon annual plans and you seek fresh planning ways to  create an organization ready to react to critical changes in the marketplace. That is great for the little fella, all nimble and lean but for the larger complex organization they struggle.  Each of the different organizational parts have different reaction and response times, are governed in totally different ways. Plans are essential as the instrument of strategic design but how can these become more reflective and responsive, this is a real thorny problem to crack.

A recent report by Strategy& suggests being more agile requires a clear focus on two attributes of ‘strategic responsiveness’ and ‘organizational flexibility’ being built into the design of the larger organizations so they can move far quicker as conditions change. A combination of ‘sensing new risk and opportunities’ to craft quick responses and also being able to “shift execution rapidly”, applying fast retooling and rework, applying this progressively over weeks and months.

(3) For innovation to fit within these far more fluid challenges, much within the current process and structures needs changing

Any ‘rapid action’ requires very different skills and infrastructure to support it. Organizations will need to encourage a higher level of experimentation, with even more of a constant focus on reducing all the unnecessary complexity. How are we managing today all the different concepts flowing through the innovation pipeline?  It often seems chaotic. We require a far more corporate-wide support and consistent engagement to drive these through the system to meet these critical new opportunities that meet changing market need or strategic goals. To do this alignment becomes essential.

(4) Pulling together the broken pieces and silos of knowledge will need different approaches

The operational areas in an organization have their own functional execution systems which are often not connected to planning and  innovation systems and processes. They remain separated as there is no real depth in the integrating process, this needs addressing. High degree’s of resistance and communication breakdowns need real solutions.

I’ve written extensively on this lack of alignment (for example) and certainly believe there are far better ways to move forward in thoughtful, constructive ways that begins the movement to establishing a clearer innovation management system.

Also we focus too much on cascading down organizations, I would argue the cascading effect of flowing back up, from the ‘grass roots’ needs a far more robust system, it provides for a deeper choice of better, connected decisions. It is this ‘cascading’ both up and down on where we often lack the real alignment and fail to incorporate within our future plans.

(5) Leadership constantly laments about ‘poor innovation’

Many organizations are failing to build and nurture any design towards the ‘innovation ecosystem.’ We are also not formulating and communicating where innovation links into strategy, we are not connecting all the different parts. Innovation stays often poorly articulated, lacking understanding of what makes-up a holistically designed innovation ecosystem.

Often innovation ‘appeals’ because we can build compelling stores. Organizations are poor at building a compelling narrative and lack the skills and communicating methods that will engage us. Innovation understanding is often left to others to interpret what it means to them to figure out their part, with a hope that their decisions will fit somehow.

Because there is often lack of internal clarity, there is also a poor connection to the external environment where opportunities are never recognized for their internal value to develop. Leadership lacks much in addressing these issues.

(6) We let ourselves down as we constantly fail in building lasting client value

Equally where the customer remains dissatisfied with the present offering, as one not meeting their explicit needs and where they often have to continue to compromise, they are ripe for change. Often the very leadership of organizations has a less than adequate ‘grasp’ of all the necessary levers for clients innovation ‘need’ to not design this in a sustaining, repeatable process with constant customer engagement they keep these ad hoc, project specific, they miss ongoing value building opportunities.

Innovation stays resolutely one-off, targeted and specialized and disconnected from planning out a series of solutions built through a well thought through road map of evolving value that builds for the longer-term lasting client engagement. There are notable exceptions here, mostly based around technology solutions, constantly evolving, adding increased benefits over time.

(7) There is such a disconnect going on between ‘talking and walking’ innovation

The organization ‘demands’ innovation, the leadership presents innovation at every opportunity, often more as a ‘fig leaf’ for the embarrassment that eventually arrives, as innovation into the market place. We need to set up a real connection between rhetoric and real value, delivering substance not just ‘promise’ or intent.

The leader needs to engage become the source or energy point to make valuable innovation really happen, no one else can. It cannot be simply delegated away. Whoever wants a leader that simply delegates growth, new wealth creation and your future to others? The need to both ‘walk and talk’ innovation consistently not just in annual meetings or board reports but in their daily engagement and detailed understanding of what makes innovation happen..

(8) We are constantly switching on and off of our innovation activities

Organizations constantly do this switching on and off, believing by pressing the innovation button, it springs back into life and delivers on demand. We just can’t simply switch innovation ‘on or off’ to meet short-term needs, it is certainly not faddish, it provides future wealth and sustainability and needs sustaining and nurturing consistently. We need a system that not just monitors the innovating health of the organization but its variances are as vigorously discussed as any operational variance.

We switch innovation ‘on and off’ at your own eventual peril, as you will eventually short-circuit the organization and the source of your future will simply drain away. People leave when they see no future or are fed-up with all the constant change. We need to make innovation our core to drive future organization performance and keep it burning bright for all to see and ‘fuel’ into to make it sustaining.

In Summary:

Can we continue to paper over these real gaps in managing innovation? How long will they continue to widen, undermine and constrain our innovation activities?

Can you see any real change to resolving these or are we just waiting for the really big one, the seismic quake that brings it all to a total stop and then we begin the painful rebuilding that should have been undertaken years ago.

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GUEST POST from Paul Hobcraft

Innovation has sat outside the core of organizations central systems for long enough. Arguably this lack of being a core central focus holds the deeper understanding of innovation back.

A core that could offer up the sustaining value and contribution innovation can make, into the growth and future well-being of organizations and having available the level of resources and commitments it needs. Today innovation seems to be falling short in delivering on its promise. Why?

Those constant top level concerns need finally addressing

So we all hear the constant ‘disappointment’ surrounding innovation. There are consistent concerns of a “lack of resources”, the “top management is not giving innovation enough attention” or “innovation lacks a clear alignment to the strategic direction”. There are constant complaints around innovation and its lack of ‘impact’ on final delivery from different disappointed stakeholders. To give innovation a better ‘fighting’ chance we need to rethink how we manage it and we have to make it more central to our organizations thinking, decision making and management in those systems and processes that give it this chance.

Today innovation tends to operate in discreet, often stand-alone applications, where the systems for innovation stay often clustered in specialized groups working on their part. This is partly by design but also by the restrictions we place on ourselves in organizational design or solutions being offered.

We have no solid, robust innovation management system in place that is Enterprise-wide to handle all that ‘makes up’ innovation, we all really do fail to deliver transforming innovation, apart from some notable exceptions based upon emerging technology applications, platforms and integrated designs.

We lack the dedicated organizational process to manage innovation

Innovation lacks an Enterprise-wide Innovation Process as this has not been tackled through any ERP system as yet, apart from some selected parts. Is innovation management to tough too capture as a total system? Can innovation be ‘captured’ fully and turned into a robust process? I believe so, but it will take a different, more radical form to deliver enterprise wide innovation that is adaptive, agile and fluid in much of its management.

The flows we need to imagine will be far more constant in change, more dynamic in what occurs and its impact and not that ‘static’ or well- defined inputs that much of the current ERP system requires. It will take a significant re-thinking.

Whenever the activities around innovation are required to be reviewed, much of this ‘selective/collective intelligence’ has to be constantly reworked, to allow it to be disseminated to a broader audience for their response and new input. What we have today is relatively  inefficient and certainly not well-connected to make a system dynamic and agile in its evolution, to parallel the often talked about ‘messy’ innovation system of today.

Stand alone or adjoining systems are not providing the full answer we are needing today.

Today we have stand-alone systems tackling idea management capture, portfolio and pipelines, research and developments with often separate project management, dashboards and performance measuring systems.

These ‘stand-alone’ systems aim are working hard at trying to create sustainable engagement, encouraging ever-increasingly scale in handling increasingly larger volumes of dialogues, information and data, as well as span global enterprise deployments.

Many software solution providers are working towards the focusing on the capturing ideas that are Customer need-driven, utilize far more the cloud-based potential, determine the Ideas and possible solutions to then work through the needed resource, identify gaps and then deliver a Work Management set of solutions, to move ideas through to eventual execution but we still have numerous ‘disconnects’ across the innovation process.

We are still lacking a complete view for managing innovation

Historically this split we see today between idea management software and the enterprise portfolio systems might have previously made sense but I think it is possibly holding the integration of innovation back for today and the future.

We need to go to the next step – providers of a holistic Enterprise-wide Innovation Process

So much of our innovations we should be dealing with deals are so often in the unknown, unpredictable, in their uniqueness and today our systems simply can’t cope with these. We still struggle in dealing with a more radical innovation need, where unpredictable consequences can occur both in defining the right inputs, forecasting the process or outcome predictability. Our present software systems are falling short to manage this fluidness and need for constant agility and adapting.

This is where we need to find a better solution, to find a way, a system and its process that keeps moving innovation towards the broader strategic core, having consistent ‘line of top management sight.’ As well as achieving consistent commitment to manage innovation far more dynamically, and in agile and fluid ways,

Even in this uncertainty we all face today, the full scope of innovation activity has much uncertainty and risk built into it that our present software solutions are finding difficult to manage or capture. It conflicts as they continue to build linear or parallel systems and not systems that adapt and respond as needed, ones that constantly ‘loop’ back, re-feeding the understanding to drive greater, broader, ever increasing innovation performance.

We need to have available an integrated enterprise-wide innovation resource process. I certainly believe if someone can build it, then the innovators will come and it will eventually become the critical core of our organizations way of doing business relating to growth.

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GUEST POST from Paul Hobcraft

“Are you going all digital on me with your innovation activities?”

So there we all were, getting really very comfortable in our open innovation activities, learning to collaborate and co-create outside our organizations. Even our management has got “open innovation”.

We are encouraged and allowed to collaborate outside our four walls of the organization as the penny has finally dropped that “not all knowledge resides within the company”.

We had worked through some of the cultural stuff, shifted around the team who like to collaborate, pushing others less collaborative to the back; the conflict points, we had established the process, practice and tools.

We even have our legal teams on board helping sort out all the conflicting positions that open innovation can mean when it comes to dividing up the IP spoils and even had our leadership tuned in, singing our praises and even (heavens forbid) getting engaged in the process.

When the world shifts, so must we

Then suddenly the world shifts on its axis once again, everything seems to be digital. The buzz is big data, analytics, smart mobility, and social media, with lots of talk of interconnected devices giving us the next big paradigm in innovation growth.

So will my innovation portals, my collaboration platforms, my idea capture tools or my crowd-sourcing and patent scanning techniques all get thrown up into the air, or are they going to be squeezed into this new digital pot?

Many are struggling with the sudden talk of big data; all of it flowing into the organization, when many of us were simply struggling with what we thought was big enough data being generated already.

What and where is this digital actually going and what does it mean to us?

How fast will the digital revolution come into my organization? Are any of us ready for this latest onslaught? Do we have the new skills all of these digital technologies need? Does this mean I have to talk again to the IT department?

So many questions are bubbling up on digital technology; it is going to be hitting us like a tsunami, at a potentially destructive force. There is a time to find the high ground and I’d recommend to start now.

We will be faced with two choices as my ‘open’ thinking here

We will either go from open innovation to open digital innovation or we will revert back to closing up and trying to manage all this data within a closed system or network. So is this another moment for open vs closed debate, just with digital included to make it ‘open digital innovation’ or, is it closed digital innovation?

Will there be a difference? I think so…

First we will need to debate the ‘network effect’. Metcalfe’s Law “that the value of the network is in proportion to the number of members squared”. In other words, the evaluation of how strong a network is will be determined by the numbers connected. As we use technologies and leverage the internet the greater our intelligence will flourish. So open digital or closed digital?

Secondly, exploiting the ‘digital effects’ will be determined by the value it can generate. The more open the data infrastructure is, the more the networks and open hardware can collect, generate information; extract actionable value and increased awareness. So open digital or closed digital?

The excitement that digital is expected to generate is in delivering the significant insights of unmet needs or current frustrations of our customers in far more ‘granular’ ways than without digital’s help.  What is being dangled in front of us is anticipated solutions.

Are we ready, can our organizations cope?

The more ‘everyone’ connects on the internet through the Internet of Things (IoT) then we will be experiencing even more of a bigger transformation. They forecast 5 billion additional people will connect to the internet globally in the next ten years all wanting to ‘give voice’.

Today we talk of ‘high-speed’ I just wonder on when ‘the day the internet broke’ or simply taking speed and putting it is greater context such as ‘managing in open innovation ecosystems to deliver the speed’.

So which way will we go? Open digital innovation or closed digital innovation?

Either into the creation and consolidation of monopolies of knowledge (closed digital innovation) or open ecosystems to foster grassroots ideas, social innovation to resolve growing problems, entrepreneurship or giving the nimble and savvy business organizations the chance to pull even more ahead in exploiting.

Each is going to demand a massive mobilization of resources, internally and externally. The digital world is more enmeshed in our lives; we are living in more ‘real-time’ than ever before that continues to form a universal distributed intelligence. We are all going to keep learning new skills and tools for understanding all this ‘collective intelligence’ coming at us.

The battle for control lies in the power of digital understanding

Question: Are we going to have a battle of competition based on open standards so as to benefit from inter-operability between this data streaming in, the multiple devices we have, and growing services and networks that we require to manage it all?

Question: Or will we see some attempting for lock-in engagements, striving for anti-competitive dynamics to steal competitive advantage and undermine swaths of ‘not able to compete’ or ‘far too slow to see it coming’?

Question: Will we see platforms that we can all sign up and join in that link all the value chain providers, each seeking their part of the value chain that will allow for replicable, scalable and sustainable solutions or shall we stay narrow in scope and ambition?

Can we afford too, if the world is connected outside our window, yet we continue to struggle looking out?

Whatever, digital feeding innovation will reign supreme in the forthcoming years or will it?

We are exploring all the current trends in digital technology promising to give us embedded intelligence in our devices, social activity, plenty of social and business platforms to join in and lots of mobility to keep us on the move, we seem to be heading off into a new world where digital will reign supreme.

All this data streaming in, either open or closed in collaborative management seems to be promising a wave of new innovation opportunities.

We have to decide which digital technologies are good for us and, are we throwing open the innovation digital doors or simply limiting it down, trying to control it for our sole competitive advantage?

Presently we are seeing the race to build platforms – but are they (really) open or (selectively) closed? So will we see open digital innovation or a specific type of closed emerge?

For me it must be open, really open, for all to participate and build from.

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GUEST POST from Paul Hobcraft

Is it to keep everyone employed in developing and launching new products, to keep our innovation structures humming along or just because it is expected from us?

Surely the job to be done might be “to reduce the product failure rate” – the end need is to get into the innovation pipeline only high-value products that are sustainable, offer clear market differentiation and have a distinct demand. Often we allow products into the development pipeline that are less than stellar.

Actually we have a wide range of reasons for ensuring failure before the product even gets launched. These are the jobs-to-be-UNDONE that need to be eliminated.

Can you spot these happening within your organization? Do you sense you have seen or been part of this set of actions that had the triggering effect of altering the product from its original discovery point.

Tackling the internal JtbD is not easy. While we deviate, while we let internal interpretations into our new product development process we are building in the chance of product failure.

Managing the internal JtbD really does need thinking about.

Knowing the need of our customers and markets is the place that will get us towards growing our business. Yet we do need to focus more often on the failures we have in the internal Job to be Done to actually improve our product success rate. Internal ego’s and the innate wish to constantly meddle along the innovation development process seem to have many jobs that need to be undone.

We need as much internal discipline to stay focused and true to a discovered customer need within our internal processes and pipeline.

How often does a product in its development get altered to accommodate internal wishes? This internally driven perspective, intent on ‘just’ getting the product out of the door, because keeping it in its original state seems simply too hard for all sorts of reasons. The emotional factors kick in and you hear “compromise and cannibalise” and a host of other fear factors to protect existing products, systems or structures that are ‘turf’ driven.

Internally we have this need to identify the true internal jobs-to-be-done and that often centers around deviations from the “customer need discovery point” and it is these which might be causing more failure than you realized, well before any product gets launched. These internal failures need to be undone.

This blog post was originally written on behalf of Hype and with their permission I have republished it here.

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GUEST POST from Paul Hobcraft

Innovation stands in service to the strategic goals of our organization, or it certainly should!

The first thing is you need to have a solid, thoughtful conversation around the type of strategic emphasis you wish to achieve from your innovation activity, how will it support the organizations strategic direction..

These can be aligned to general strategic needs such as growing market share, differentiation and disrupting adjacent markets, serving the consistent changing and demanding customer needs, or by honing the delivery process, by spotting those and then exploiting them rapidly and effectively. All these become alignment conversations.

Creating clear goals and linking / aligning innovation to those, gives a more agile top-level strategy dialogue as a vital step before you get into the actual innovation concept – delivery stage. Senior executives must establish the manner in which innovation fits within the strategic context established by goals, vision and strategies.

If you just simply are diving into innovations with no alignment structure you risk growing disappointments. In setting about having a series of strategic conversation of where innovation ‘fits’ can change the goalposts, alter the perspective and can give the innovation a more focused framing to build far better value propositions around.

Constructing an innovation conversation framework is never easy, we all come at it in different ways and those strategic conversations can begin to fray at the edges and slip more into tactical, the more we talk and this needs to be watched!

What I am suggesting here is an innovation conversation framework

One where we can approach different strategic value propositions, and where we might need to debate these across the organization, as the points of impact and resource need, so we can make a move towards a higher degree of innovation alignment from all involved.

If we take just the three ‘classic’ strategic thrusts of product leadership, operational excellence or customer intimacy, then we need to make clear the potentially different emphasis points within any suggested innovation approach that we should take.

The innovation alignment framework for a strategic conversation

We must, within any innovation approach, be clear on what and where we should be placing our primary focus.

Aligning innovation within a strategic conversation framework

This framing can be most useful to remind people who are involved that there are significant points of difference depending on the route approach to market.

There is a need to agree and align on what we are driving towards – and support any selected strategic direction. This framework can really open up the discussion. It can begin to show the possible implications and challenges ahead.

I would really doubt you could achieve a combination of all three, if you just consider some of the aspects I’ve laid out within this framework above.

If it is still demanded, and some leaders can be just that, demanding – wanting to cover all the bases without knowing why they should be really focusing down on one of these. The direction you go requires the organizational focus to build the type of capabilities, resources and processes to match this and these are critically different, dependant on the approach you take.

Really do try to establish some key strategic principles

I would suggest you really do need, even more, a framework to remind you of the critical differences and what aspects need clear focus to deliver to the distinct value proposition parts. Each strategic value proposition has significant implications to plan and work through.

This framework can help you to contribute to achieving a greater alignment between the strategic direction (product leadership, operational excellence or customer intimacy) and the key innovation aspects that help to align to this which the organization will need to think about and work through.

Publishing note:  This blog post was originally written on behalf of Hype and with their permission I have republished it here.

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GUEST POST from Paul Hobcraft

Is the digital technology we are see that is emerging going to be able to provide the positive tension between rational and randomness that takes place in our innovation activities today?

Will digital begin to dominate our innovation thinking, will we lose this randomness?

Randomness offers that spark of human creativity or will digital be allowing this to connect multiple strands in new, more exciting ways?

How are we going to adjust to the changing way technology will impose itself on our innovation activities and needs?

How will all this Mobile Connectivity, Cloud Computing, Social Media, Crowdsourcing, Internet of Things, Industrialinternet, Big Data, Analytics, 3D Printing and Scanning be presented and managed as a part of successful business scenarios and intertwined with changes of social behavior?

Are our existing innovation systems ready for this potentially set of sweeping changes of knowledge inflows and translation, so they can be successfully commercialized into new innovation?

It is through searching for and seeking engagement in the ‘wider’ world we will begin to make greater connects and receive potentially enormous amounts of (raw) data, about interactions, performance, possible issues and connecting, previously fragmented and dispersed information and through analytics turn this into emerging valuable knowledge.

Rational and Random thinking can be accommodated with digital technologies

Technology has spawned operating systems that are more often set up to be searching for the rational, for the known, for the patterns by setting up the system hierarchy, by ensuring a coherent input of facts and data,

This can allow you to automate the process and generate greater outcomes that give you scale, make considerable processing saving, and gain increasing efficiencies by the constant quest for improvement and automation.

We are equally seeing more random pattern recognition, matching, ‘crunching’ data to offer up multiple scenarios. Then we begin to see equally a big move in where you store this data, those ‘data lakes’ where you can constantly revisit and draw down raw data, in new and different ways. For managing significant data  the cloud offers a significant alternative than on-premise.

The equal measure of delivering randomness

Thankfully the quest to extract intelligence out of the raw data has equally kept the randomness side moving along in equal measure. It is this side that is making the big leap through these emerging technology changes of social media, smart mobility, sensors and other machine intelligence that is generating vast new levels of data. This big data requires analysis and the analytical aspects coming from exploiting different algorithms, will allow for greater insights into all the activities taking place.

There is even more of a promise that artificial intelligence can combine with human intelligence in significantly different ways, to generate new growth and deliver those richer, higher scale, more innovative business outcomes, that this investment being undertaken will be required to bring.

What needs changing is the innovation process to accommodate these changes

The arrival of big data is full of bytes, both terabytes but also big, huge strategic bites! We seem to be in a really evolutionary period, with the explosion of change taking place in the post-digital world of cloud, big data, social and interconnected devices.

The discovery of insights from all this embedded intelligence, social activity and data analytics is leading us to potentially manage a significant wave of new innovation opportunities from this digital knowledge.

Managing this transformation is a real strategic and operational challenge

We will need to transform much within our systems but more importantly to orientate our skills to receive, translate and diffuse new knowledge, in significantly different ways.

It is through this combination of people and ‘things’ connecting into our businesses that we will be able to extract new observations, to give us insights that can lead to completely different innovation opportunities. That is the promise of this ‘fat juicy carrot’, providing fresh growth, new innovation opportunities, that have real value and worth.

Insights and ideas will become a real log jam attempting to enter the innovation pipeline

As it stands I can see a potentially a damaging build-up, or a log jam of promising concepts all desperately trying to work themselves through the innovation funnel. Either decisions or the existing disciplines have to be radically altered, where we take on a much higher risk profile to enable these to move from idea to finished product or new service, or we accept the consequences of different failures, growing frustrations or variable revenue metrics against the cost invested.

Cranking up the innovation throughput needs radically different approaches than at present

The innovation pipeline today is very manual, it needs human intervention, in decisions, in inputs, in what is communicated, what is approved or dropped. Innovation gets often weighed down by human intervention.

Will this change, if so what is required is for the innovation process to become more automated where predictive decisions or probability ratings are presented more from technology design and digital information? What changes are needed, who will be willing to invest in this radical redesign of the innovation system?

Radical smart-connected and digitally discovered concepts will radically alter the value proposition as I have outlined before. These will need the internal business structures to alter and deliver new business models to respond in unique market ways.

That will call for bold leadership and radical redesigns of much within our organizations to allow greater innovation to flow out to the market to capitalise on these increasing levels of insights coming from a more digitally connected front end.

I wish I could ‘feel’ the same dynamics and emphasis on down-stream systems being able to manage this data rush heading down towards us but I don’t. I think we might all become simply overwhelmed, let’s hope not.

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GUEST POST from Paul Hobcraft

Having different perspectives and voices will enhance your innovation activities; they provide diversity, stimulus and greater options for you to consider the future innovation journey. How do we set about engaging with all these different voices surrounding innovation?

The three horizon framework

It is really useful for managing your innovation activities, drawing out the often conflicting voices within the organization on how to take innovation forward. The approach can unlock you from just being caught in the present, to one of envisaging a future that then allows you to begin to build different capabilities, competencies and capacities.

Find out more here and here and here on the three horizons framework. You will find  I have provided a considerable overview in different posts that build on the thoughts around the 3H thinking and why I place such value in it for innovation’s evolution.

Applying the 3H perspective

The 3H framework offers a perspective that accepts the need to both address the multiple challenges that occur in the first horizon, foster the seeds of the third and, allocate appropriate focus and resources to manage the transitions from one to another.

What makes the model valuable to innovators is that it ‘accepts’ that competition is restless, markets are evolving, and that change is a constant. The three horizons approach offers the methodology for constructing plausible and coherent innovation activities projected out into the future. It looks for emerging winners.

The 3H is simply not a planning tool

If you use this 3H framework well it is providing a valuable evolutionary perspective that dialogues can be formed around. This can lead to better decisions on where to focus and what resources to apply can be based on a more plausible and coherent set of activities projected into the future. It brings you to that constant searching for emerging winners, those that can potentially change and challenge your existing business but evolve it in clear ways. The 3H is a dialogue mechanism to help frame the evolving journey and allow you to move towards it in a better structured way.

The three voices that need to be in the same room

The need is to discuss the challenges in horizon one and nurture the seeds of the third. It is not an either/or, good/bad discussion. You need those robust discussions to form fresh perspectives.

The key is in listening out and becoming adept at managing these conversations between the ‘three separated voices’ of the three horizons you need to work across. These are:

• You have the voice of today, the voice of the manager(s) responsible for delivering todays result that are more concerned with managing the existing, maximizing returns and keeping the organization going efficiently and effectively.

• Then you have the second voice, the voice of the entrepreneur, the one eager to experiment, try out new things, explore and extend, accepting some aspects will not work

• Last we have the third voice, the voice of the aspirant, who is looking to build a different vision, believing in different, more pioneering ways and visualize things in their ‘mind’s eye’, far more aspirational, that can seemingly on first ‘take’ look to be totally incompatible to the reality of today.

Synthesising these different voices

The different voices involved can be highly engaged, all wanting to add their perspective, you need to listen to them. You need to search for common ground, growing recognition and sometimes realization, that these are not so much separate voices, but actually ones that can all be combined, to provide a far greater outcome when they can ‘see the same future’ but through their own specific voice.

It is the combination of these different three voices that need to come together and help frame the innovation journey. It is by applying and using the three horizons framework and its methodology you can draw out and advance better outcomes for your future innovation activity.

Change does come from different experiments and explorations

It is partly through the treatment of innovation, feeding into the system a rising wave of future innovations that alter positions. Staying stuck in ‘just’ incremental to serve the existing conditions in the market seriously constrains you for the future, you stop growing, exploring, being curious and experimental.

You need to encourage experimentation, testing, prototyping, accelerating the learning and then being ready to scale what holds promise and abandon what seems not too. For this you need all the voices within your organization seeing the future, so they can consciously work towards it, even when it might seem vague and not fully clear. The 3H framework draws out discussions, it helps project into the future.

Just always remember, the present is already in decline.

Look out, do not stay locked in. Entrenchment limits your options to break out, as much as you might feel it needs defending, as its providing your present day core.

Encourage all three voices in any innovation discussions!

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