Category Archives: Innovation Perspectives

Where is your Innovation Friction?

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Innovation Perspectives - Where is your Innovation Friction?How should firms develop the organizational structure, culture, and incentives (e.g., for teams) to encourage successful innovation?

When it comes to creating an innovation culture, often people make it far too complicated. If you’re part of the senior leadership team and you’re serious about innovation then your job is simple – reduce friction.

If you’re serious about innovation and you’re not a senior leader, then your job is to do what you can to convince senior leadership that innovation is important. Then, gently help your execs see the areas of greatest friction in your organization so they can do something about it.

When it comes to creating a culture of innovation, the most frequently cited area of friction in organizations is the acquisition of resources for innovation projects (the infamous time and money). Senior leaders serious about innovation must eliminate the friction that makes it difficult for financial and personnel resources to move across the organization to the innovation projects that need them (amongst other things).

But this particular impediment is just a part of a much larger barrier to innovation – the lack of an innovation strategy. When senior leadership commits to innovation and sets a strong and clear innovation strategy then policies and processes get changed and resources move.

A couple of years ago I ran a poll on LinkedIn asking people to identify their organization’s biggest barrier to entry. 566 people responded and 58% of respondents identified either the absence of an innovation strategy or the psychology of the organization as the biggest barrier. ‘Organizational psychology’ came out on top with 32% of the vote, with ‘Absence of an innovation strategy’ a close second (26%). Other choices in the poll included – ‘Organizational structure’, ‘Information sharing’, and ‘Level of trust and respect’.

(poll results timed out on LinkedIn)

A second major area of innovation friction is the movement of information. Too often there is information in disparate parts of our organizations that remains separated and unknown to the people who need it. Organizations that reduce the friction holding back the free flow of relevant information to where it is needed will experience a quantum leap in not only their product or service development opportunities, but in many other parts of their organization including sales, marketing, and operations.

So, what are the areas of friction that are holding your organization back from reaching its full innovation potential?

What are the barriers to innovation that have risen in your organization as you struggle to maintain a healthy balance between your exploration and exploitation opportunities?

I’ve explored the idea of barriers to innovation further in my book Stoking Your Innovation Bonfire from John Wiley & Sons. It’s been called “accessible and comprehensive” and companies have been acquiring it in bulk to both identify and knock down barriers to innovation, but also to build a common language of innovation.

Build a Common Language of Innovation

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Trendspotting Trifecta

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Innovation Perspectives - Trendspotting Trifecta‘Who should be responsible (if anyone) for trend-spotting and putting emerging behaviors and needs into context for a business?’

I believe this question should really be broken up because there are three VERY different (and incredibly important) pursuits intermingled here:

  1. Trend spotting
  2. Putting emerging behaviors into context for a business
  3. Putting emerging needs into context for a business

Only at the very beginning of a business, when it is all or nothing for a small team of founders, should responsibility for these three tasks be combined. The reason responsibility for these three different pursuits should be split up is because each requires a different way of thinking, that often requires different types of people to generate the most relevant and actionable insights.

As I’ve written before, insights and execution are the real keys to business success, and in building any successful innovation – the insights come first. So, combining these three pursuits properly and getting the insights correct is incredibly important – otherwise you’ll design, build, and distribute a solution that misses the mark with customers.

Trend spotting requires big picture thinking, a talent for separating the notable from the unimportant, the ability to see how potential trends connect together, and the vision to see the impact of this trend intersection (what megatrends might they point to, etc.).

Putting emerging behaviors into context for a business requires an incredible capacity for insightful observation, the ability to spot influential thinkers who are good at identifying and describing changing behaviors, and the skills to synthesize a collection of perspectives into a cohesive view of the future. This view of the future must of course have a strong chance of being correct.

Putting emerging needs into context for a business is incredibly difficult and requires understanding how emerging trends and behaviors will intersect with new technologies and other business capabilities to expose new customer needs. Those new needs then represent potential growth areas for businesses to enter with new solutions. The goal of course is to identify and act upon these emerging needs before the competition has the opportunity to observe these needs as expressed behaviors and actions and react.

The one skill that all three share in common however, is the ability to disconnect one’s own perspective from the changing perspectives of others. Whether you as an organization choose to hire people into these roles, hire in consultants to provide this insight, or to spread the responsibilities around the organization, you must have a strategy.

Personally, I believe organizations may soon begin creating insight networks within their organizations in the same way that they currently do with innovation. This means having a central insights team at Corporate HQ with strong executive support that is responsible for managing the process, the distributed global network, its training/certification, and its outputs. This does not have to mean starting a new team – companies could incorporate these responsibilities within an existing dedicated-innovation infrastructure. So, can an insight management software industry be far behind?

And last but not least you will need to assign people to monitor trends and emerging behaviors and needs from Six Ways to Sunday:

  1. Demographic and Psychographic Changes
  2. Legal and Political Changes
  3. Different Geographies
  4. Different Industries
  5. New Supplier and Technology Capabilities
  6. New Business Capabilities and Business Models

Do you have a strategy and responsibilities in place for spotting trends and emerging needs/behaviors in your organization?

What are you waiting for?

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Educating Tomorrow’s Workforce

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Not much has changed since 2010 when on Blogging Innovation (which has now become Innovation Excellence) we asked the following question as part of a series of Innovation Perspectives:

What product or sector is in desperate need of innovation?‘.

Educating Tomorrow's WorkforceHere was my response:

When I first saw this topic I wanted to write about education innovation, but I resisted when a couple of the contributing authors chose this topic. I wrote about the publishing industry instead, but then in 2009 I came across a Phil McKinney article and had the opportunity to meet Sir Ken Robinson then too, and my passions for an education revolution were stirred.

We sit at the nexus of amazing new education technology capabilities, the globalization of work, and an incredible transformation in the needs of employers. The path forward is not the same as the road behind, but our education system is proceeding as if it were.

“We need our children to be Masters of Mystery and Einsteins of Insight.”
– Braden Kelley

Instead of pursuing the current education mantra of more, better, faster, we need to instead rethink how we educate our children because we need to prepare them for a different world. A world in which flexibility, adaptibility, creativity, and problem solving will be prized ahead of the deep technical knowledge that is fast becoming a commodity and easily available.

I’ve said here before that the keys to business success are insight and execution. We are ending an era of incredible business focus on execution excellence and are entering an era of an increasing business focus on insight. Excellent execution will always be valued and required, but more and more components of this execution are shifting from the developed world to the lower-wage developing world.

We are currently in a race to the middle when it comes to standard of living as the developing countries like China, India, Brazil and others climb up the pyramid and developed countries like the United States, Italy, Greece and others slide down. Those developing countries wanting to stay near the top of the flattening standard of living pyramid will have to re-tool their education systems to to prepare their populations to grab as big a share as possible of the higher-wage insight-driven jobs.

Here is an interesting chart from a Newsweek-Intel Study reformatted by Phil McKinney:

Innovation Skills for Children

Looking at the differences in perspectives between the American and Chinese respondents in the research, I came to two possible conclusions:

  1. I am Chinese
  2. The United States (and many other developed countries) are headed in the wrong direction and better change course on education fast

You may think that my views on education are too business-focused, but look, even the arts are being globalized (look at Cirque du Soleil).

I believe that we underestimate children’s ability to understand the real world and I think that the education system and the business world need each other more than they realize. We need to re-imagine our public-private partnerships and expectations when it comes to education, and we need to start educating today’s young kids for tomorrow’s world.

The fact is that we are pushing the limits of taking today’s understanding of science to improve productivity an standard of living. Going forward we will need to break through currently held physical and natural limits and an expanded understanding of our physical and natural worlds. This will require a new generation of scientists and workers who can synthesize approaches from different cultures and disciplines, that are masters of creative approaches to problem solving, and that have the entrepreneurial spirit to breakthrough perceived barriers. Are these the kind of students we’re educating?

What kind of students is your country educating?

Build a Common Language of Innovation

As an added bonus, if you haven’t seen it, I encourage to check out Sir Ken Robinson’s video on “Creativity versus Literacy” here:

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Innovation – Marketing versus Engineering

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What are the roadblocks and critical relationships between marketing and engineering in the cause of advancing innovation?

Let me start off by recommending that you watch the movie I’ve embedded, as it does a great job of describing how there is often an engineering solution to a problem and a marketing solution to a problem. This in part explains why there is often a tension between marketing and engineering when it comes to new product development – they see different solutions, assign value differently, and view success in divergent ways. So, please enjoy the video, and my article will continue below it:

So in the future, with the problem at hand, you might want to ask yourself – “Is the problem best solved by changes to the real value, redefining the intrinsic value provided, or a bit of both?”

Of course it is very hard for people to ask these questions honestly as they have a default response, but asking them in a cross-fuctional environment may yield a more holistic and informed response. And after all, many of the barriers that people tend to erect in the achievement of something are often because they didn’t feel involved in the decision-making process.

So, what are some of the barriers that people erect in a sometimes tension-filled environment?

  1. Isolation – You just avoid communicating with the other side as much as possible

  2. Stonewall – You just do what you would do anyways and ignore the input from the other side

  3. Passive Aggression – You consciously choose to behave in a way that will cause the effort to fail, so that ideally you get your way instead

  4. Build a Fortress – You build complex written rules of engagement for your department saying that it has to be this way because you’re too busy and these rules will help you be more organized

  5. Omission – You take the inputs but then you don’t do anything with them (marketing doesn’t promote a feature, or engineering doesn’t fully develop it

Working TogetherThe biggest danger to the cause of advancing innovation when it comes to the engineering and marketing departments is that the relationship develops into one without constructive conflict and without healthy collaboration. For innovation to be repeatable in an organization these two sides must share openly, have their perspectives valued, and contribute to a conversation. Marketing and engineering hear different aspects of the voice of the customer in their interactions with them, and they approach solutions to problems in different ways.

I would even argue that there is probably no more important set of cross-functional relationships than those between marketing and engineering, and that their health will determine the future success or failure of the organization. The executive team should consciously monitoring the health of these relationships, because when they start pulling in opposite directions, the entire organization could be ripped apart.

What directions are these two organizations pulling in your organization?


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Who should own innovation?

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Innovation Leadership

When I think about who should ‘own’ or manage innovation, and where it should reside in an organization, I believe the answer is obviously “It depends.”

There cannot be a single answer for these questions because every organization’s strategy and specific culture of getting things done could be different. But, the one thing that I can say for sure is the following:

“Every CEO must own innovation, but not manage it.”

The CEO must own innovation because he or she is responsible for approving the strategy that the organization is going to pursue. At the same time, managing innovation is an emerging specialty of the same level of complexity of human resources or finance, and so CEO’s are not qualified to manage it outside of deciding who should manage innovation in a manner consistent with the organization’s strategy.

The most relevant variable from the organization’s strategy in determining how innovation should be managed is whether or not an organization is committed to being an innovation-led organization. If the organization intends to be an innovation-led organization (attempting to improve every component and offering of the organization through innovation), then a dedicated innovation organization should manage innovation. If the organization would prefer to pursue innovation as a periodic or product-focused effort, then Marketing or R&D should manage innovation.

Another way of looking at who should manage innovation is to ask yourself the following question:

“Who is going to be asked to, allowed to, or encouraged to contribute innovation ideas?”

Your answer determines who should manage innovation. Here are some answers and their implications:

1. Our Scientists

  • In a research-led organization, R&D should manage the innovation efforts of the company with input from Marketing, Finance, HR, and Legal. R&D should be responsible for providing the appropriate innovation training to the R&D department. Marketing-led organizations should see #2.

2. Our Customers, Partners, Suppliers (or all three)

  • Marketing should manage the innovation efforts of the company with input from R&D, Finance, HR, and Legal. Marketing should be responsible for providing the appropriate innovation training to people managing the process.

3. Our Employees

  • A new centralized innovation group should manage the innovation efforts of the company with input from Marketing, R&D, Finance, HR, and Legal. Marketing should be responsible for providing the appropriate innovation training to the Marketing department.

4. A Combination

  • As soon as the combination includes employees, a new centralized innovation group should manage the innovation efforts of the company with input from Marketing, R&D, Finance, HR, and Legal. Marketing should be responsible for providing the appropriate innovation training to the Marketing department.

Innovation FundThe reason that almost every scenario ends up with a centralized innovation group managing innovation is because of the complexity involved in properly managing innovation. A centralized innovation group has the opportunity to continually evolve the innovation understanding of the organization and cascade that knowledge through a set of innovation champions, distributed throughout the organization. A centralized innovation group can also remove most of the innovation management burdens from other groups by taking responsibility for managing the policies, processes, systems and training needs for idea generation, selection, funding, and development. This allows other groups to focus on achieving excellence in their day jobs and coming up with great ideas.

And, after all isn’t that what we’re all after – great ideas to turn into marketplace innovations?

Build a Common Language of Innovation

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Directed Innovation for Strategic Success

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Directed Innovation for Strategic SuccessIt seems like every organization has a vision and a mission statement, and some even have mantra’s. My personal innovation mantra is to make innovation and marketing insights accessible for the greater good.

At the same time organizations are creating their mission statement, many take the time to create an organizational strategy, only to then neglect the creation of an innovation strategy.

I believe that every organization should create an innovation strategy with the same diligence and precision that they attempt to create their organizational strategy with. Has your organization created an innovation strategy?

An innovation strategy, what’s that?

An innovation strategy sets the innovation direction for an organization. It gives members of the organization an idea of what new achievements and directions will best benefit the organization when it comes to innovation. As with organizational strategy, innovation strategy must determine WHAT the organization should focus on (and WHAT NOT to) so that tactics can be developed for HOW to get there.

There are two main kinds of innovation – directed innovation (or intellectual innovation) and emergent innovation (or instinctual innovation). An innovation strategy benefits both types. An innovation strategy provides the contraints that the organization’s directed innovation needs, while also providing the focus that helps emergent innovation, well, emerge over time as members refer back to the innovation strategy.

Innovating Inside the BoxBest practices indicate that innovation succeeds best when it is constrained. But for some people, it doesn’t make sense that innovation needs to be constrained. – “Don’t great ideas come from giving people free reign?”

The short answer is no. By giving people constraints, it actually sets their creativity free, but in a directed fashion.

A well-defined innovation strategy helps the organization define which innovation challenges to focus on and what tactics will best help the organization overcome those challenges. An innovation strategy provides a map to refer back to as projects and ideas are being evaluated.

An innovation strategy should communicate to the organization the kinds of innovation that will be most valuable to the organization in helping it achieve its corporate strategy. It is best practice for an innovation strategy to support the organizational strategy.

Without an innovation strategy, an organization can find itself pulled in many different directions, dissipating its innovation energy and preventing it from accelerating its innovation pace by combining the outcomes of strategically-related innovation efforts.

Finally, even those organizations that have successfully created an innovation strategy, often miss the most important part – to communicate it out very clearly to all members of the organization, so that members know exactly what the innovation strategy is and precisely how to contribute. If you’ve done a good job of this, you won’t be afraid to ask your members the following question – What is our innovation strategy?

Are you afraid?

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Innovation Perspectives – Insights and Execution

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Innovation Perspectives - Insights and ExecutionThis is the seventh of several ‘Innovation Perspectives’ articles we published in 2009 from multiple authors to get different perspectives on ‘What is the most dangerous current misconception in innovation?’. Now, here is my perspective:

For my money, the most dangerous misconception that leaders have is that coming up with a great idea is the key to innovation.

This is not the case. Insights and execution are the most important ingredients for creating innovation. As more industries become commodity battlegrounds, success will now be the driven by two key things:

  1. The quality of the insights a company has identified to build ideas upon

  2. The organization’s ability to turn their insight-driven ideas into reality

As innovation moves front and center in an increasing number of companies and industries, the quality of insights and execution will separate the winners from the losers.

Apple moving into the phone business should not have surprised a single handset manufacturer out there. What competitive response did handset manufacturers expect as they introduced increasingly music-capable phones?

The idea of a phone that is also a music player is not, in and of itself, a differentiated idea capable of capturing the imagination of the consumer, and so the iPhone was not created with the goal in mind of creating a digital music player that is also a phone (though that was the strategic purpose for its creation). Apple needed a strategic response to protect their digital music player market from being disrupted by the mobile phone handset manufacturers.

But, Apple also knew that to be successful in an industry that they had no experience in, mobile phones, that they needed to introduce a truly differentiated and valuable offering. To achieve that goal, they needed a unique insight to build their ideas on of what a mobile phone should aspire to be.

The insight they chose to build their mobile phone business on, was the insight that people were now ready to make their computing experience more portable, while also at the same time making it more personal. The key idea built on this insight was that of the App Store. In building their phone around this insight, they were able to create a device that not only could play music (and help to protect their digital music player market from being disrupted), but could also perform just about any other function that a user might desire (or even imagine to build).

A lesser company would have endeavored to build the world’s best music phone, but instead Apple realized that it was more important to build the world’s most personal and customizable mobile phone (that happens to play music). This is the power of building around an insight instead of an idea.

Apple realized that the contracts with AT&T and the permission to do something like the App Store, along with building an application development platform that developers could rally around, were possibly even more important than the device itself.

One of the lesser known innovation truths is that a true innovation is often more than just a single idea, but is often several ideas coming together to serve a new key insight. Apple’s insight was that computing was about to become more personal and move to the hand as part of this increasingly personal transition.

What insight will you build your business around?

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Innovation Perspectives – Cash, Plastic or Free?

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This is the first of several ‘Innovation Perspectives‘ articles we will publish this week from multiple authors to get different perspectives on ‘What product or sector is in desperate need of innovation?‘. So to kick it off, here is my perspective:

Innovation Perspectives - Cash, Plastic or Free?There are lots of industries that are desperate for innovation, especially in this recession, but my choice is the publishing industry. First let me say that far too often the publishing industry is too narrowly defined as relating to the publishing of books. Or, if it is thought of in a more holistic manner, then it is still spoken about in terms of its isolated silos – books, magazines, newspapers, music, software, etc.

Yet what is the publishing industry but a group of businesses that make their living distributing the work of “artists” to the masses. And no matter which of these silos you choose to read about, you’ll come across stories of their pending demise (even software). Taken at face value, the publishing industries are facing an apocalypse and should be desperate for innovation – and they are…

Recently I came across an article talking about how now instead of paying 99 cents a song as on iTunes, users will be able to download and listen to the music they want for free after watching a 15- to 30-second advertisement at sites like FreeAllMusic.com. As a concept, advertising-supported music you can share is not new. It used to be done with the radio and a cassette recorder, but now it is possible for downloads and sharing and social media to all be combined together. For a music industry struggling against piracy, it needs to innovate further in areas like this.

The magazine industry is shrinking at an accelerating rate with magazines like Business 2.0 (one of my favorites) closing up shop, and rumors swirling about Newsweek possibly disappearing as well. Two newspaper towns are becoming one newspaper towns and the art of the newspaper business (feature stories and investigative journalism) is quickly being replaced in the dailies by more stories off the wire.

Both newspapers and magazines are hoping that devices like the Amazon Kindle, Barnes and Noble’s Nook, and their own e-reader creations will save them. Some magazines are getting a little more creative. National Geographic is offering their entire archive on a portable hard disk, and Sports Illustrated is preparing for the new generation of rumored slate computers with a new interactive format.

The book industry is coping with the fact that on Christmas Day, for the first time in history, Amazon sold more digital books than paper books, and also with Google’s designs on digitizing every book they legally can. So, as you can see all of the silos in the publishing industry are desperate for innovation.

But what does the future hold for the publishing industry?

If you watch the embedded video in my Apple Tablet Sneak Preview article, or if you watch the embedded video of Coursesmart’s offering in my Microsoft-Apple-Google in Tablet Battle article, I think you’ll get a sense of where things are going and the kinds of innovation that the publishing industry silos will need to consider.

The bottom line is that when people start carrying around high-definition multimedia devices with them that are always connected to the Internet, then the boundaries between different media types are going to feel artificial. Customers will flock to more integrated content.

This will require companies delivering information or entertainment solutions to customers to innovate new partnerships and deal structures, new business models, and new product and service offerings to better meet customers’ quickly evolving entertainment and education expectations. Industry structures and silos are about to be transformed.

So, what kind of publishing industry innovations can you imagine in this new world?

You can check out all of the ‘Innovation Perspectives‘ articles from the different contributing authors on ‘What product or sector is in desperate need of innovation?‘ by clicking the link in this sentence.

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