You can’t go an entire commercial break during the Super Bowl or a State of the Union address (okay, sorry, both American examples) without hearing the word innovation pop up at least once or twice. Companies have added innovation to their company values and mission statements in accelerating numbers. Some organizations have implemented idea management systems. And others are willing to spend large sums of money on design firms and innovation boutique consultancies to get help designing some new widget or service to flog to new or existing customers. Based on all of that you would think that most companies are committed to innovation, right?
If you asked most CEOs “Is your organization committed to innovation?”, do you think you could find a single CEO that would say no?
So, why do think I’m about to make the following statement?
90+% of organizations have no sustained commitment to innovation.
When it comes to fostering continuous innovation, most organizational cultures stink at it.
Let’s look at some data, because anyone who is committed to innovation (and not just creativity) should love data (especially unstructured data from customers):
Over the last 50 years the average lifespan of a company on the S&P 500 has dropped from 61 years to 18 years (and is forecast to grow even shorter in the future)1
In a worldwide survey of 175 companies by Hill & Knowlton (a communications consultancy), executives cited “promoting continuous innovation” as the most difficult goal for their company to get right. “Structurally, many companies just aren’t set up to deliver continuous innovation.”2
84% of more than 2,200 executives agree that their organization’s culture is critical to business success3
“96% of respondents say some change is needed to their culture, and 51% think their culture requires a major overhaul.”3
So what does this data tell us?
For one thing, it helps to reinforce the notion that the pace of innovation is increasing.
For another thing, it doesn’t exactly scream that organizations are as committed to building an innovation culture internally as their words externally say about being committed to innovation.
Why is this?
Well, as fellow Innovation Excellence contributor Jeffrey Phillips once said:
“When it comes to innovation, ideas are the easy part. The cultural resistance learned over 30 years of efficiency is the hard part.”
And when you get right down to it, most employees in most organizations are slaves to execution, efficiency, and improvement. And while those things are all important (you can’t have innovation without execution), organizations that fail to strike a balance between improvement/efficiency and innovation/entrepreneurship, are well, doomed to fail.
This increasing pace of innovation along with the lower cost of starting/scaling a business and the always difficult challenge of building a productive culture of continuous innovation, is the reason that the lifespan of organizations is shrinking.
So if it isn’t enough to talk about innovation, or to invest in trying to come up with new products and services, shouldn’t more organizations be also investing to making sure their innovation culture doesn’t, well, stink?
The obvious answer is… (insert yours here)
So, if your innovation culture stinks, I encourage you to come join me at Pipeline 2014 and attend my keynote session on exploring five ways to make it smell better:
“Our Innovation Culture Stinks – Five Ways to Make it Smell Better”
It’s a free virtual event on June 6, 2014.
I look forward to seeing you there!
Sources:
1. Innosight/Richard N. Foster/Standard & Poor’s
2. Hill & Knowlton Executive Survey
3. Booz & Company Global Culture and Change Management Survey 2013
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I’ve uploaded a sample chapter of my highly-rated popular book Stoking Your Innovation Bonfire from John Wiley & Sons to Slideshare. Stoking Your Innovation Bonfire is a great book focused on helping organizations identify and remove barriers to innovation, but also serves as a great innovation primer for organizations beginning their innovation journey and looking to establish a common innovation language across the organization.
Thousands of people around the world have already purchased, downloaded, or checked out their copy of Stoking Your Innovation Bonfire and enjoyed the easy, but valuable read, and I hope you will too.
Keep innovating!
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There is a war for innovation brewing, and building a deep innovation capability is the only way to win it. The question is, will you lead the charge onto the innovation battlefield, or will you let your competitors bring the fight to you?
As an increasing number of industries become commoditized, innovation has become an important way to distinguish your company from the competition, and a necessary investment just to maintain your existing market position.
In this thought paper, I lead the charge against the status quo. I explore how your organization can stay relevant, grow, and thrive with an innovation framework that addresses four key areas: Leadership & Structure, Processes & Tools, People & Skills, and Culture & Values.
Following on the heels of a recent thought leadership webinar (link to recording) on the same topic, this white paper explores the intersection of talent management and open innovation strategies. The paper dives into why having an external talent strategy is becoming increasingly important and how it can help your company accelerate innovation, shows how leading organizations manage their open innovation and crowdsourcing efforts (including case study examples of companies like P&G), and provides proven strategies and steps to take for attracting talent to your organization’s innovation efforts.
Ultimately, successful and sustainable innovation is all about purpose and passion. The people in your organization have to be clear on what the purpose of the organization is. Ideally, that purpose has to be something bigger than the individuals and something that people can get passionate about, because first and foremost, as Jeffrey Phillips has said, “You can’t force a disinterested person to innovate.”
Passion is a prerequisite not just for getting started with innovation; people leading innovation projects must have enough passion to fight through, over, around, or under any obstacles they may encounter in their effort to make a new idea a reality.
“Passion-based organizations stop at nothing to accomplish their goals and are able to attract people and resources to their causes. That got me thinking. Over all of my years as an innovation junkie, the common denominator, among the innovators I have connected with and the most successful enterprises I have observed and worked with, is passion. They started with a passion or cause and then organized around it to make it happen. Not the other way around.” — Saul Kaplan
Blogging Innovation as a Case Study in Passion
I started innovating long ago, but I didn’t start Blogging Innovation until 2006. I realized I needed an outlet to express my passion for innovation, and blogging offered the perfect opportunity. I kept reading and writing about innovation despite getting only a couple of hundred people to read my articles each day. Then at the start of 2009 I completed a marketing strategy project for Wunderman and Microsoft Windows Live, and, using some great tools including Website Grader, I discovered that the blog had some technical challenges. After fixing those, traffic to Blogging Innovation finally started to take off. Now instead of averaging more than 200 daily visits, the blog averages nearly 10,000 and the numbers are still growing. Do I spend less time on the blog now than I used to? No!
Most people would consider an increase in traffic of 2,500 percent in one year as being a huge success and a chance to relax, but I don’t see it that way. Back in August 2009 I decided to commit the blog to a mission of making innovation and marketing insights accessible for the greater good. As a consequence of that mission, I decided to open up the blog to the very best contributing authors on the topic of innovation and other marketing – related subjects that I could find.
Instead of using the blog as an extension of my company, Blogging Innovation exists to help raise the baseline understanding of innovation and marketing so that organizations can become better at satisfying the needs of their customers, the first time they try. After all, the more efficient our organizations are at meeting their customers’ needs, the less waste of human capital and natural resources. That’s what drives me to get up at 5:00 a.m. seven days a week to start letting people know about all the great content our contributing authors have published that day.
We have recently decided to take on a monthly sponsor who wants to be associated with innovation in a tasteful way, but that is not for commercial reasons but because the blog needs additional people power to run it and a new site design to make the content even more accessible. As I go out to look for the assistance I need to take Blogging Innovation to the next level, I’ll be looking for one thing in the people I choose to help make the community stronger — passion.
Note: For the newer readers, Blogging Innovation formed the foundation of Innovation Excellence before I sold it and re-booted Blogging Innovation as Human-Centered Change & Innovation.
Passion versus Obsession
There is a great article “Passion versus Obsession” by John Hagel that explores the differences between passion and obsession. This is an important distinction to understand in order to make sure you are hiring people to power your innovation efforts who are passionate and not obsessive. Here are a few key quotes from the article:
“The first significant difference between passion and obsession is the role free will plays in each disposition: passionate people fight their way willingly to the edge to find places where they can pursue their passions more freely, while obsessive people (at best) passively drift there or (at worst) are exiled there.
It’s not an accident that we speak of an “object of obsession,” but the “subject of passion.” That’s because obsession tends towards highly specific focal points or goals, whereas passion is oriented toward networked, diversified spaces.
The subjects of passion invite and even demand connections with others who share the passion.
Because passionate people are driven to create as a way to grow and achieve their potential, they are constantly seeking out others who share their passion in a quest for collaboration, friction and inspiration . . . . The key difference between passion and obsession is fundamentally social: passion helps build relationships and obsession inhibits them.
It has been a long journey and it is far from over, but it has taught me that obsession confines while passion liberates.”
The failure of Solyndra – a United States solar energy venture backed by $535 million in federal loan guarantees drew the ire of many people concerned with the state of the federal budget deficit and the growing national debt. But was the federal government wrong to offer loan guarantees to Solyndra?
This is the question many people asked back when the failure happened, and I would be interested to hear what you think.
In a previous article I stated some of my thoughts on the role the federal government should play in the overall innovation ecosystem in the United States, and I stand by what I said in that article – An Open Letter on Innovation to President Obama.
To quote the relevant part for the discussion:
We need to take a step back and define what the role of government is in our overall innovation efforts as a country:
What are the big research challenges that companies are unwilling to spend on that if pursued and conquered, would unleash a wave of innovation?
How can companies and the government work together to fund and share technology that doesn’t define competition, but does accelerate productivity and global competitiveness of U.S. firms against foreign competitors?
How can we restructure our tax system to reward successful American firms for taking the bigger risks that will help them continue to lead their industries in the future?
How can we incent American exporters trailing foreign competitors to try and leapfrog and disrupt foreign competitors, take market share, and create jobs in this country?
Should we build a deep innovation coaching capability into the Small Business Administration so that small companies can get access to innovation education?
If the last wave of innovation in this country was built on the passion and ideas of foreign born entrepreneurs, should we not be doing more (not less) to encourage the world’s best to come here and study and start businesses?
If we are in a war for innovation, should we not be building innovation alliances with countries in the same way we have built military alliances for centuries? More and more companies are doing this, why not countries?
You’ll notice that nowhere on this list was funding companies. This is a special skill and one that most people wouldn’t think about the government as having, especially when you take into account that identifying a potentially successful startup is not about the idea, but about identifying strong management teams that have the capability to lead a team of people to find and overcome the critical flaws in the founding idea and get the final solution to market. Funding companies isn’t something that the government should be focusing on – even when they pursue it in a portfolio approach (Solyndra represents only 2% of the Department of Energy’s committed loan guarantees).
From an outsider’s perspective the $535 million would have been better spent in discovering and transferring a platform technology to multiple companies that could then work towards getting the basic platform technology to market (funded by the private sector). Then other American entrepreneurs could have generated even more jobs by building upon it. Think about the growth in the US Economy that the platform technology of the Internet generated. It is too soon to see whether the failure of Solyndra will be a big blow or a small blow to the Obama administration’s innovation efforts, but it probably also didn’t help that last week Alan Greenspan was quoted as saying:
“Can innovation create jobs? The answer is that is not its focus,”
“Jobs are created in that process and what happens in private industry as technology decreases unit costs and especially labor costs, profits go up, companies expand and then they hire people,”
“Innovation reduces jobs, and there is no way getting around that syllogism,”
Alan Greenspan may be simplifying things here and ignoring that there are more types of innovation than cost innovation, but hey, let’s give the guy a break as innovation is not really his focus.
Also this week it emerged that Thomas Friedman has a new book coming out with Michael Mandelbaum called That Used to be Us that essentially says the United States must innovate or else. After all, we’re never going to be cheaper, so we have to better and more innovative. That leaves a huge challenge for the government of the United States.
To replace all of the debt-fueled, consumption-related jobs that will likely never come back, the United States must come together as a collection of public, private, and charitable institutions to re-train our workforce and change our mindset as a country to focus not on consumption but creation in order to generate the new jobs necessary to reduce a 9.2% unemployment rate.
But for all of the focus in the media and academia on improving the quality of Science, Technology, Engineering, and Math (STEM) education in America, we must also introduce an equally strong focus on creating young people that are equally capable of becoming the flexible and adaptable workforce that organizations will need to continue to succeed at innovation. This includes helping reinforce the value of unplugging in our always-on society that suffers from expectations of immediate response.
All of this taken together still shows that the United States still needs a cohesive, long-term, committed innovation strategy if we are to prevent the country’s continued loss of ground to other rising economies over time. Because any innovation strategy requires long-term focus and commitment, I remain doubtful that the United States politicians will be up to the task, and very doubtful that in an era of collapsing education budgets that we will be able to train our children to be more flexible and adaptable with the requisite skills in language to translate the value of their ideas, the technical skills to create the value, and the logic to create the systems necessary to make it easier to access the value of their ideas. But we will see.
It is my belief as I have said before in my article Stop Praying for Education Reform that we must come together outside the normal school day to educate our children in the skills necessary to create the innovation capacity they will need to take our country forward through the rest of this century, and help to maintain its place near the top of the economic pyramid.
Ultimately the question is not whether the United States CAN still lead the world in innovation, but whether we have the WILL.
What do you think?
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This is the first of a series of video and text interviews with innovation leaders at a range of companies that are seeking to create innovation excellence in their organizations. This interview, and many others with innovation leaders from trailblazing organizations around the globe, will build upon the foundation of the research and findings contained in my first book – Stoking Your Innovation Bonfire – and will form part of a case study on Intuit for my next publishing effort. This effort will be a highly collaborative and interactive endeavor looking at what is required to make innovation a deep capability in successful organizations.
If you think your organization is doing some really great work to create innovation excellence in your organization, please contact me.
I am excited to present the first innovation interview in this video interview series examining some of the topic surrounding the development of a deep innovation capability. I had the opportunity to interview Scott Cook, Co-Founder and Chairman of Intuit, at The Economist’s “Innovation 2011: Entrepreneurship for a Disruptive World” event in Berkeley, CA. In this video Scott talks about some of the key factors required in helping an organization become excellent at innovation. Below you will find the video and a written transcript.
Here is the innovation interview transcript:
Hello everyone this is Braden Kelley of Blogging Innovation. here with Scott Cook the founder of Intuit. Scott, I would really like to ask you about innovation and building innovation as a deep capability within the organization and as you started Intuit and as you look to grow and make it a successful company, what are some of the key things that you tried to do to help make innovation a capability in a continuous possibility for the organization.
Scott: Yeah that is something we have been spending a lot of time on over the last 4 years so I think a lot of the DNA we have on innovation is good in the company but we had lost some of the skill and capabilities. We hired new people, new managers so we went into a big rebuilding starting in 07. Things that have been very— I mean what you are trying to do, is change and improve the way teams do their daily work and the way managers, what they expect of teams.
So we worked it at all levels, so I work with teams from the top and it changes your expectations of what business unit leaders do with their teams and then we have innovation catalysts who work to couch teams and help teams when they hit innovation roadblocks or trying to leap and really change their thinking. We also work on skill building so one example is that a number of our executives had actually narrowed who we would hire from various companies, good folks but it never actually done innovation in a way that we teach people to do it.
So we took 2 days of an off site with just the top 18 people in the company and had our innovation catalyst come in and have them do the very process that we expect to our teams. Customer immersion with the customers and the executives did it, why we recruited customers as they came in. The nature of going broad that day— in a nature of trying to come to a key insight, testing that insight back with the customers then going broad, I don’t care with that insight, what could you do and then narrowing.
We made them go through the same steps that we expect as a team so they personally could have done it. I find it hard for leaders to lead to a destination, they have not yet been. So that is why we had to work on a leash up level but at the same time we were working on the team so how they work. So that is, we also do internal company broadcasts where we take teams inside Intuit and they tell their stories of how they did it step-by-step because we all learn from stories.
Another thing that we do is we teach by doing. We used to teach by preaching, talk at people. I don’t find adults learn from being talked at. They just retain the same habits they already have. So if we really want to change habits you have to get them to practice the new habits. So now when we do company meetings or leadership development sessions most of it is doing very little of it as listening. We get them busy doing the very things we want them to do or with homework in advance where they had to interview people who do what we want, then to do and learning from that and report back into a very doing process.
So that has been a big change we have made as from how we actually conduct the meetings where we want to use them to change habits so it is a series of things, note it happens fast step-by-step. Some teams move faster than others and we try to use those to inspire the rest but I think as I worked with teams now I see them— we are getting better outputs higher success rates with customers much higher than ratings of new products, fewer failures are pruned out early and cheap which is the whole goal. So I have seen the output metrics now finally after 4 years at working at this that you would project in the desire from making these sorts of interventions.
Braden:So in talking with other people in Intuit, it became very clear that when the company started small there was this idea of Follow Me Home’s, and then you know kind of follow me into the office and the catalyst programs sounds like one of the things that you are doing to try to instill some of these behaviors across the company and expose people to some of the ideas. And as I, you know talked with people at the organization it became very clear that the design for the like concept that you are trying to move across the organization is spreading farther and wider and then as you pursue that what are some of the key challenges that you found and that you have overcome over time in relation to trying to take some of the small company ethos as you have grown and maintain that those aspects of designing for a customer to like?
Scott: I want to say 2 things one is there is a challenge of team size. The team’s size when we started of course was small so everyone in the team was very close to customers. Our team size has grew and it grew and it grew and once you get a bigger team you move from 4 people working on a product to the 20 or 30 or 50, well then you have got some people in the team who go out and meet with customers. Other people say “Nah, I don’t need to do that, you do that, oh just listen to what you are saying” and suddenly you just get most of the team who has never met with customers or has not met in the last year with customers or with prospects.
And then you have much more communication problems, you don’t have shared vision, you don’t have shared understanding, a lot of things go haywire so key is to get back to smaller team sizes. So we have been busting up the team sizes sort of taking teams that used to be 30 or 40 and broken up some note in some cases no team bigger than 4. And we have to architect the work a lot more if those teams are truly going to be independent and that is our jobs as leaders. So that has been one very helpful thing. I think another. I would focus on learning from customer behaviors, not learning from customers, learning from customer behaviors.
Because the tempting tendency is for people on teams to rely on what customers say and maybe that works if you are selling to specialists. Let us say you are selling to a doctor who does cardiac surgery 8 hours a day, 5 days a week maybe that person can really tell you accurately what they are going to do if confronted with a new offering. But for regular people that just sell regular stuff to who might do taxes ones a year or might work with a bank ones in a week or pay their employees ones every 2 weeks. What they tell you, maybe half of it they will actually do, but you actually don’t know which half you are listening to.
So I learn much more reliable behaviors, trust observable behaviors that you can observe and measure either measure remotely through what happens in the web or you can measure by observing with your own eyes. The tendency though when you take people having them trained and send them out to meet with customers is they have got to interview customers. Well you just invented the word’s most expensive way to do a customer interview. If you are going to interview them call them on the phone or send survey, don’t do Follow Me Home.
Follow me homes are there so you can see with your eyes so shut up, say nothing, watch for an hour or two, or three then you can ask him about what you saw and then you are asking about behaviors. That is still an interview, not the most reliable but it will be better because you are probing about specific behaviors yourself. So I say that is the second thing that we have worked to re-instill this trust behaviors and behavioral data, not attitudes or words.
Braden:Very good, well I think the insight is very important and really and the taking the time to listen like you said is very important to innovation, I mean that is what we are all trying to do there early is the people that follow blogging innovation so on behalf of the readers and the viewers of Blogging Innovation, I think you very much Scott for your time and again this has been Braden Kelley of Blogging Innovation here with Scott Cook of Intuit.
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Is the era of innovation over? Or is the war for innovation just beginning?
I came across an article in one of Canada’s main newspapers — The Globe and Mail — by Barrie McKenna titled ominously, ‘Has Innovation Hit a Brick Wall?’
The article speaks to how the Canadian government sinks billions of dollars into research and development every year, yet the country remains an innovation laggard compared with most of its trading partners. The author refers to this as Canada’s “innovation deficit.” The article then goes on to examine some research from University of British Columbia economics professor James Brander that examines whether Canada’s problem is part of a much broader global phenomenon.
The conclusions that Dr. Brander comes to are less than comforting (if you agree with his view of innovation); his research found the pace of innovation to be slowing dramatically in four key areas: agriculture, energy, transportation, and health care.
As someone who works with companies to help foster innovation and whom frequently writes and speaks on the topic, I have a problem with Dr. Brander’s conclusions about Canada and the world in the same way that I have issues with the way that the U.S. Congress and President Obama approach innovation in the United States. In fact the American government’s approach to innovation prompted me to write the controversial ‘An Open Letter on Innovation to President Obama.’
I’m working on a white paper for a client, and as part of my research, I’m looking for a few people who are willing to share what the innovation imperative was for their organization to start innovating (or to increase their effort spent on innovation).
Why did your organization decide to make a commitment to innovation?
Why did management decide that they wanted to sustain an effort to make innovation a deep capability of the organization?
Or even, what was the fire that caused management to commit to an innovation project?
Ideally I am looking for people who are willing to be quoted, but if you are not, that’s okay too.
Sound off in the comments or use the contact form.
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In support of my crowdfunding project over on IndieGoGo I am offering an incredible deal to the first TEN (10) individuals to grab this perk:
In exchange for each $500 investment, the first TEN (10) people anywhere in the world will get:
One of only TEN (10) spots in an online seminar where I will personally train you on how to facilitate a Nine Innovation Roles workshop or public seminar
A share of any Nine Innovation Roles Workshop leads that I can’t fulfill myself
A Nine Innovation Roles Seminar Pack – which includes TEN (10) Nine Innovation Roles Group Diagnostic Tools to use with your first set of workshop participants (a $199.99 value)
This is a great opportunity to add the Nine Innovation Roles Group Diagnostic Workshop to your roster of innovation services that you offer to clients. You should be able to charge between $2,000-$5,000 + expenses for each of the sessions you facilitate depending on the length and amount of custom content, so you should recoup your $500 investment after running your first workshop or public seminar.
The Nine Innovation Roles diagnostic workshop will create a fun, interactive experience for innovation teams or organizations to use to help people better understand what roles they fill on innovation projects, why the team’s or organization’s innovation efforts are failing, and how they can together improve the innovation performance of their teams or organization.
So, grab this Amazing Innovation Keynote and Nine Innovation Roles Workshop Deal and help your innovation teams be more successful in the future. Don’t wait. Be one of only TEN (10) people worldwide to get this perk, or pre-order the seminar kit and run run workshops or seminars on your own.
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This is the first of a series of video and text interviews with innovation leaders at a range of companies that are seeking to create innovation excellence in their organizations. This interview, and many others with innovation leaders from trailblazing organizations around the globe, will build upon the foundation of the research and findings contained in my first book – 
Is the era of innovation over? Or is the war for innovation just beginning?
I’m working on a white paper for a client, and as part of my research, I’m looking for a few people who are willing to share what the innovation imperative was for their organization to start innovating (or to increase their effort spent on innovation).
