Tag Archives: 3M

Underground Innovation

How giving people space can make a big difference to your innovation profile

Underground Innovation

GUEST POST from John Bessant

If you’d snuck up behind me last weekend you’d have caught me in the act of painting walls. Not the most exciting of pursuits but it needed to be done so that now I can sit here and write in a freshly-painted room. And importantly one where even my clumsy brushwork doesn’t show in unsightly streaks and overruns. I am amongst millions of painters, professional and otherwise who regularly mutter small votes of thanks to Richard Drew and his invaluable contribution to the world of painting and decorating — masking tape.

This humble but essential innovation is getting on in years but still turns a profit for the company which originated it way back in 1925–3M. But it would never have seen the light of day if company strategy and official policy had prevailed. It exists because of Drew’s late night and unofficial efforts in direct defiance of his boss’s orders.

Drew was working as a technical salesman, dealing with some of the copmpany’s biggest customers for their core product — sandpaper. He spent a lot of time visiting car factories in that newly-growing industry, and in particular the paint shops where sandpaper was used to prepare metal surfaces for painting.

The paint crews were well aware of the good old days when Henry Ford had simplified their job — in 1909 he’d outlined a strategy for his company, which concentrated on a single model (the Model T) which could be built in high volume at low price. Doing this involved a number of trade-offs, not least in terms of massively editing down the choices available to customers. It was at this strategy meeting that he reputedly said ‘Any customer can have a car painted any colour that he wants so long as it is black.’

That decision helped establish the Model T as ‘a car for Everyman at a price every man can afford’, bringing the price down by 75% and putting it within the reach of many people. But it didn’t satisfy the market for long. People wanted more choice in models, styles — and colour schemes. All of which made life more difficult for the skilled craftsmen in the paint shops, trying to deliver ever more exotic paint jobs without slowing down production.

The problem is that when you want to paint with more than one colour then you need to cover up the area you don’t want painted. Which is a clumsy fussy business; early attempts involved using rags, newspapers and scraps of cardboard but then they had to be held in place, making a one-man job into a two-man job. Attempts to solve this by using sticky tape to hold the mask in place also failed; the solvents in the paint dissolved the adhesive on the tape making the whole mask slip and slide all over the surface.

An Innovation Dust-up

Which is where Richard Drew came in, trying to sell a new kind of sandpaper which 3M had launched which offered to cut down the dust created when preparing a metal surface for painting. Hearing some choice language coming from one corner of the shop he walked over to ask what the problem was — to be given an expletive filled tutorial in how not to mask up a paint job. What was needed — he was told in no uncertain terms — was a better adhesive tape which would actually stick and stay stuck!

He went back to his office and began to tinker around with various formulations to try and make something suitable. His boss wasn’t too pleased, ordering him to get back to his main job of selling sandpaper — but he kept on with the quest.

It took him two years and involved a variety of vegetable oils, chicle, linseed, various resins, glue, glycerine and treated crepe paper. What he eventually came up with was a tape strong enough to stick to the surfaces but easy enough to peel off without leaving any scars on the paintwork. Despite its promise his boss wouldn’t allow him to buy the machinery he needed to produce it in quantity — so Drew turned his innovative skills to the problem of financing capital equipment. He bought his machinery in small pieces, each of which cost less than the $99 he was permitted to spend on an item of equipment., and then assembled the machine himself.

This last act finally convinced his boss to let him go ahead — and also provided a lesson which became a company mantra. The boss in question was William McKnight and he made a key policy out of the experience. “If you have the right person on the right project, and they are absolutely dedicated to finding a solution — leave them alone. Tolerate their initiative and trust them.”

And so 3M’s ‘bootlegging’ approach was born, and it persists today embodied now in formal company policy. Give people permission to play around, don’t control them too tightly and let their natural creativity and entrepreneurship do the rest. Their 15% policy (allowing employees to spend up to 15% of their time in pursuit of their own ideas and hunches) has been responsible for thousands of product and process innovations, a few of which (like PostIt Notes) have gone on to be breakthrough radical innovations.

Operating Below the Radar

The masking tape story is a classic example of innovation happening below the radar screen (except the radar wasn’t invented in 1925!). We know today that smart companies who care about innovation invest in the capacity for innovation — R&D and market research, future scoping, etc. Organized innovation, buying themselves options on the future. All good — but maybe only focusing on the formal means potentially missing out on what might be happening underground. Because by their nature people are innovators, prone to experiment and tinker around, frustrated with aspects of their work which they think a little hacking around the edges might help them with. Why not tap into this as another source of innovation?

(Especially since it’s actually not that expensive in terms of lost productive time. The origin of the 15% figure at 3M was McKnight’s the observation that this was the time people spent on coffee breaks and on lunch breaks and so on, times when they could do some of this unofficial innovation).

It’s not just the benefits in terms of the possible product and process innovations which it might lead to. It’s also a powerful motivator, something which can help retain and inspire employees. Allowing people time and space to explore communicates a core company value — — it’s an invitation to tinker to hack things, to play around. And it has certainly paid off for 3M and other companies; consider these examples:

  • The Sony PlayStation started as a bootleg project by Ken Kutaragi, an engineer who secretly worked on a video game console with Nintendo without Sony’s approval.
  • The HP DeskJet printer was originally developed by a group of HP engineers who wanted to create a low-cost inkjet printer for personal use. They used bootleg parts and software to build their first prototype, which they hid under a tablecloth when not in use.
  • The first spreadsheet software was created by two programmers Dan Bricklin and Bob Frankston, who worked on their project without any formal support or funding from their employers. They went on to found their own company, Visicalc, which for a while was the market leader in the field.
  • Google’s 20% allowing employees time to spend on personal projects led to several innovations including Google Maps, Google News and Gmail.
  • Toshiba’s pioneering notebook computer was developed by a team of engineers who worked on it covertly for four years. They used their own laptops and software tools to create a prototype that featured innovative elements such as a lightweight design, a long battery life and a high-performance processor. The project was initially rejected by the management, but later accepted after some modifications. Introduced in 1985 it became a global leader in the portable computer market.
  • BMW has a long history of bootleg innovations which have gone on to become success stories. For example the Z1 roadster was developed by a small team of engineers who worked on it secretly for four years. They used their own time and resources to create a prototype that featured innovative elements such as a plastic body, retractable doors and a modular design. The project was eventually discovered by the top management and approved for production in 1986. And the iDrive was developed by a team of engineers who worked on it without any formal mandate or budget, using their own laptops and software tools. They also conducted user tests with their own cars and friends. The project was initially rejected by the management, but later became a standard feature in many BMW models. These projects helped legitimise what the company now calls ‘U-boat’ projects , recognising the value of the bootlegging approach.

Forbidden Fruit

Peter Augsdorfer made a classic study of the phenomenon, reported it in his wonderful book ‘Forbidden fruit’ in which he highlights many examples of such ‘bootlegging’ approaches. (The term originated during the 1920s when the US government banned the manufacture and sale of hard liquor; the measure didn’t have the desired effect of wiping out the industry and sobering up the country. Instead it triggered a wave of illegal but at times highly innovative ways around the problem, essentially driving innovation underground and out of sight . This included hiding illicit liquor down the inside of boots).

Augsdorfer argues that bootlegging can be seen as a form of learning under uncertainty, where employees experiment with new ideas and technologies without formal approval or support. In other words it’s an unofficial extension of the R&D/exploration work which companies need to do anyway.

Importantly it’s an approach which can have other positive benefits for organizations beyond the innovations which its employees create, such as enhancing motivation and employee retention and fostering a culture of internal entrepreneurship. But it has its ‘dark side’; there are negative outcomes including wasting time and resources, violating ethical norms and — a big challenge for those trying to ‘manage’ it — undermining organizational control and co-ordination frameworks.

Innovation Missionaries

Augsdorfer orginally wrote about this 25 years ago but a recent article in the Sloan Management Review reminds us that such underground innovation is alive and well. It’s not a case of ‘one size fits all’ and their article highlights a number of different approaches. It also usefully identifies three key archetypes of characters who may be innovators of this kind. They call them ‘missionaries’, ‘users’ and ‘explorers’.

Missionaries have a particular interest in the development of the company; their self-adopted ‘mission’ is to improve things. Characters like Richard Drew would fall into this category, seeing their own progress as being tied up with the fortunes of the company they work for and tapping into its resources to help them achieve their goals.

User innovators are essentially frustrated in what they are doing — they develop hacks and work arounds to solve problems particularly in the area of process innovation and their ideas can often be surfaced through suggestion schemes and other mechanisms.

And explorers are concerned with pushing the frontiers of what they do, sometimes going in directions which the company does not believe is possible. The risk here is that they pursue their ideas too far, detracting from their mainstream work and official company strategy.

Making Space for Innovation

So what makes underground innovation work? It’s not simply waving a magic wand, Harry Potter style, and casting the ‘Innovate!’ spell. Instead a number of things need to come together:

  • Allowing space — time, access to resources, etc. The exact amount — 15, 20 or even higher percentages of time — is irrelevant. It’s the signal that matters, communicating that it is OK to experiment around the edges and that there won’t be negative consequences for such action. What often happens is that this small amount of investment encourages employees to spend much more of their own time and initiative, often working long unpaid hours in pursuit of their ideas. At the limit (as Paula Criscuouolo and her colleagues point out) there are good examples of bootlegging arising from contexts in which there is no formal space or time allocation but an underlying perception that it is still OK to ‘dig around a little’.
  • Giving boundaries — defining the space within which innovation is possible and permission to explore there. For example we don’t necessarily want bootleg innovation in the formulation of pharmaceutical products but that leaves plenty of scope for other ideas, particularly in process innovation.
  • Establishing a development pathway to pick up on bootleg ideas. There’s no point stimulating lots of bootlegging behaviour if employees have nowhere to channel their ideas once they start to develop. In the case of 3M there’s a clear pathway which allows employees to take bright ideas and pitch for varying amounts of internal funding and other resources to grow and scale their innovations. Such functionality is increasingly built into innovation collaboration platforms and many companies — such as Liberty Global with their Spark programme — have established employee entrepreneurship pathways in parallel to their suggestion schemes.
  • Communicate trust as a core value — allowing bootleggers to feel a sense of psychological safety about what they are doing and that they will not be penalised for their activities.
  • Reward and recognise — it’s no coincidence that one of the things about 3M is that the people who have been involved in developing bootleg projects to fruition are then rewarded not just with resources and money but also with the opportunity to carry their venture forward. One of the two people involved in the development of Post it notes was Art Fry who moved on to run the division for 3M. The originator of the laptop computer within Toshiba similarly went on to run that division of their business.
  • Encourage intelligent failure — the down-side of allowing people to take initiative is that they will make mistakes. Importantly one of McKnight’s famous comments was that Management that is destructively critical when mistakes are made kills initiative. And it’s essential that we have many people with initiative if we are to continue to grow.’

Underground innovation has a lot to offer -but as the above suggests it isn’t a simple matter of mimicking Google or 3M, allocating a percentage of time and then waiting for the magic to happen. Successful organizations make employee involvement a key plank in building their innovation culture; something William Mcknight learned from his experience as Richard Drew’s manager. By 1929 he was running the entire 3M company and he pulled together some of the core principles through which their culture developed — including what he called his ‘Basic rule of management’. It’s deceptively simple and it serves well as a motto for anyone interested in tapping into underground innovation:

“delegate responsibility and encourage men and women to exercise their initiative.”

Image Credits: Pixabay

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Benchmarking Innovation – Standards and Practices

Benchmarking Innovation - Standards and Practices

GUEST POST from Art Inteligencia

In today’s rapidly evolving business landscape, the ability to innovate consistently and effectively is more critical than ever. Yet, defining how to measure and benchmark innovation remains a complex challenge. Benchmarking innovation involves evaluating how different organizations manage to achieve success in innovative practices and understanding the key components that contribute to their performance. As a human-centered change and innovation thought leader, I propose that there are several layers to effectively benchmarking innovation: defining innovation metrics, recognizing best practices, and understanding the cultural components of innovation.

Defining Innovation Metrics

Measuring innovation is not a one-size-fits-all proposition. Organizations must carefully select metrics that align with their strategic goals. Common metrics might include research and development expenditure, the number of new products or services launched, the percentage of revenue from these new offerings, and the scope of patent filings. However, organizations should also consider less conventional metrics, such as the speed of idea to implementation, customer satisfaction, and customer adoption rates. Establishing clear metrics upfront is critical, as they guide both internal evaluations and external benchmarking activities.

Recognizing Best Practices

Analyzing the best practices of companies renowned for their innovative capabilities can provide powerful insights. Companies like Apple, Google, and 3M are often cited for their innovation successes. By studying their methodologies, such as Apple’s focus on user-centric design or Google’s commitment to creating a ‘20% time’ for creativity, organizations can adopt practices that may fit their own innovation frameworks. Collaboration, cross-functional teams, and fostering a culture where risk-taking is encouraged are just as important as technological advancements. Benchmarking against these exemplary models helps companies identify gaps and opportunities within their own structures.

Understanding Cultural Components

The culture of innovation within an organization plays a pivotal role in its success. It’s a blend of leadership, employee empowerment, and the willingness to embrace failure as a stepping stone to success. Effective innovation cultures often feature strong leadership commitment to innovation as a core value, continuous learning opportunities, and a structure that rewards both individual and team contributions to innovation. These cultural components can be benchmarked against industry peers and leaders in unrelated industries to gather insights and adapt strategies to fit their unique environments.

Case Study 1: Apple’s User-Centric Innovation Model

Apple Inc. has consistently been at the forefront of innovation, primarily due to its unwavering commitment to a user-centric approach. The company benchmarks its innovation efforts not merely by technological advancements but by its ability to address user needs in transformative ways. A key standard that Apple employs is its design philosophy, where form and function go hand-in-hand.

By analyzing customer feedback, market trends, and user behaviors, Apple has refined its processes to keep innovation at the core. They benchmark the success of their products not only through sales but also through customer satisfaction metrics and brand loyalty scores. For instance, the iterative improvements in the iPhone line demonstrate how Apple remains responsive to consumer needs while maintaining stringent internal standards for innovation. This approach has made Apple’s innovation practices a standard reference point for companies worldwide.

Case Study 2: 3M’s Diversification and Employee Initiative

3M is a quintessential example of fostering innovation through employee initiative and diversification. Known for its wide range of products spanning numerous industries, 3M has built an innovation culture that emphasizes cross-pollination of ideas, allowing innovation to flow across diverse sectors of the company.

One of their hallmark practices is the ‘15% rule,’ which allows employees to dedicate a portion of their working time to pursue ideas they are passionate about. This practice, which can be seen as a unit of measurement itself, ensures that 3M cultivates an environment ripe for spontaneous innovation. Benchmarking their success often involves comparing the ratio of resources allocated to these initiatives versus the resulting revenue from new product lines. Internal metrics focus on the balance and effectiveness of diversification strategies, which in turn reinforce 3M’s position as an innovation leader.

Integrating Benchmarking into Innovation Strategy

To integrate benchmarking effectively into your innovation strategy, companies should create a structured approach. Begin with a thorough internal analysis of current innovation practices. Identify strengths and areas for improvement by comparing against industry standards and leading companies in related fields.

Engage in cross-industry benchmarking to broaden perspectives and bring insights from diverse practices and challenges. Involve diverse teams in the benchmarking process to ensure that findings are holistic and inclusive of different viewpoints within your organization.

Finally, make sure that learnings from benchmarking efforts translate into actionable strategies—whether it be modifying internal processes, updating metrics, or investing in cultural shifts. This continuous learning and adaptation cycle is key to maintaining competitive edge and fostering sustained innovation.

Conclusion

Benchmarking innovation is an ongoing journey of learning, adapting, and applying. While it involves comparing metrics and practices, it is ultimately about transforming insights into innovative practices that propel an organization forward. By embracing both the measurable and intangible elements of innovation, businesses can ensure that they not only keep pace with the rapidly changing world but lead the charge into new frontiers of possibility.

Extra Extra: Futurology is not fortune telling. Futurists use a scientific approach to create their deliverables, but a methodology and tools like those in FutureHacking™ can empower anyone to engage in futurology themselves.

Image credit: Pixabay

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Encouraging Creative Confidence in Teams

Encouraging Creative Confidence in Teams

GUEST POST from Art Inteligencia

Creativity is the lifeblood of innovation. In an era where organizations must continuously adapt and innovate to stay competitive, the need for creative confidence among team members has never been greater. Creative confidence isn’t just about having creative ideas; it’s about having the courage to act on them. This article explores strategies for cultivating creative confidence within teams and provides illustrative case studies.

The Significance of Creative Confidence

Creative confidence is crucial because it empowers individuals to venture beyond conventional boundaries, engage in problem-solving with a fresh and diverse perspective, and ultimately drive transformative change. Often, teams have inherent creativity, yet it remains untapped because members may feel intimidated, undervalued, or uncertain about expressing their ideas.

Empowering teams with creative confidence involves nurturing an environment where people feel safe to express themselves without fear of criticism or failure. Howard Schultz, former CEO of Starbucks, summed it up appropriately when he said, “Risk more than others think is safe. Dream more than others think is practical.”

Components of Creative Confidence

  • Psychological Safety: Creating an environment where team members feel secure enough to take risks and share their thoughts openly.
  • Growth Mindset: Encouraging a mindset that views challenges as opportunities to learn, rather than obstacles to success.
  • Collaboration and Diversity: Valuing diverse perspectives and leveraging collective intelligence to foster creativity.
  • Iterative Experimentation: Promoting the idea that innovation is a process characterized by iterative testing, learning, and improvement.

Strategies to Build Creative Confidence

1. Foster a Safe Environment

Instill a culture where failure is viewed as a part of the innovation journey, not a career-ending mistake. Encourage team members to share ideas without fear of criticism. Leaders play a crucial role in modeling this behavior by sharing personal experiences of failure and lessons learned.

2. Embrace a Diversity of Perspectives

Innovation thrives in diverse environments. Empower teams to embrace varying points of view, background experiences, and expertise. This diversity fuels new ideas and approaches that might not be considered in homogenous groups.

3. Encourage Experimentation

Create opportunities for team members to experiment with new ideas through pilot projects or prototyping sessions. Encourage short iterations and maintain an iterative mindset towards product enhancement and service development.

4. Establish a Feedback Culture

Nurture regular feedback mechanisms that are constructive and actionable. Encouraging feedback from various stakeholders increases the range of insights and perspectives, aiding idea refinement.

5. Cultivate a Growth Mindset

Promote a culture where learning is seen as a continuous journey. Recognize and celebrate effort, resilience, and improvement. Showcase real-world examples of how embracing challenges leads to innovation.

Case Study 1: Google’s 20% Time

Google’s “20% Time” initiative is an exemplary case of promoting creative confidence. Engineers and employees are encouraged to spend 20% of their time on projects they are passionate about, outside of their usual work responsibilities. This policy has led to the creation of new innovative products, such as Gmail and Google News.

The “20% Time” initiative shows the power of providing space for creative thought. By trusting employees to explore their ideas, Google harnessed a wealth of creativity that has demonstrably contributed to the company’s growth and innovation pipeline.

Case Study 2: 3M’s Innovation Culture

3M, a world leader in innovation, has created a culture that balances formal structures with the flexibility needed for creativity to flourish. Their “15% Time” rule is a policy allowing employees to spend up to 15% of their working hours on projects that captivate them, akin to Google’s system.

This commitment to creative exploration has paid off tremendously: approximately 30% of 3M’s annual revenues come from products invented within the last five years. The company encourages cross-disciplinary collaboration and ensures a low-risk environment where inventiveness is encouraged and tangibly rewarded.

Conclusion

Encouraging creative confidence in teams is a significant component of sustaining innovation within organizations. By creating environments that nurture psychological safety, diversity, experimentation, feedback, and a growth mindset, your organization can harness the creative potential of its people to drive meaningful change.

Remember, while some strategies may work better for specific environments or industries, the underlying principle remains the same: fostering an environment that encourages creativity and innovation holds the key to navigating and succeeding in the complex landscape of modern business.

The road to creative confidence is a journey, not a destination. By diligently implementing these strategies and learning from the experiences of others, any organization can amplify its innovative capabilities and achieve extraordinary outcomes.

Extra Extra: Futurology is not fortune telling. Futurists use a scientific approach to create their deliverables, but a methodology and tools like those in FutureHacking™ can empower anyone to engage in futurology themselves.

Image credit: Unsplash

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The Role of KPIs in Measuring Innovation Performance

The Role of KPIs in Measuring Innovation Performance

GUEST POST from Art Inteligencia

In today’s rapidly evolving business landscape, innovation has become an imperative for survival and growth. Organizations around the globe are striving to harness innovation to drive competitive advantage, increase market share, and improve customer satisfaction. However, measuring the performance of innovation initiatives poses a significant challenge. Enter Key Performance Indicators (KPIs) – a vital tool in quantifying success, identifying areas for improvement, and driving innovation forward. But how can KPIs be effectively utilized to measure innovation performance? Let’s explore.

Understanding Innovation in Organizations

Innovation is not just about groundbreaking products or novel services; it encompasses processes, business models, customer experiences, and even organizational culture. Measuring its performance, therefore, requires a multilayered approach tailored to the strategic objectives of the organization. KPIs can provide a structured framework and a clear direction to streamline the measurement process.

Defining KPIs for Innovation

KPIs are quantifiable metrics that reflect the critical success factors of an organization. In the context of innovation, KPIs must be carefully selected to align with the organization’s vision and strategic goals. Effective innovation KPIs typically fall into a few categories:

  • Input Metrics: These measure the resources and efforts invested in innovation, such as R&D expenditure, number of innovation projects, or employee training hours.
  • Process Metrics: These KPIs evaluate how innovation is managed and executed within the organization, reflecting the efficiency of innovation processes, speed to market, and development cycle times.
  • Output Metrics: These assess the outcomes of innovation efforts, including number of patents filed, new products launched, and incremental revenue from new offerings.
  • Impact Metrics: These KPIs measure the broader effects of innovation on business performance. This includes customer satisfaction, market share, and long-term financial performance.

The Importance of Tailored KPIs

The challenge with measuring innovation through KPIs is ensuring they are relevant to the unique context of each organization. A one-size-fits-all approach is likely to falter. Instead, organizations should customize KPIs based on their innovation maturity, industry specifications, and strategic goals. The right KPIs can uncover insights that lead to actionable strategies for enhancing innovation performance.

Case Study 1: 3M’s Commitment to Innovation

3M is often hailed as a model of innovation, boasting a track record of transforming inventive ideas into profitable products. For decades, 3M has successfully used KPIs to drive its innovation strategy. The company has set a specific KPI: 30% of its sales must come from products developed in the past five years.

This KPI fosters a strong culture of innovation, incentivizing teams to consistently innovate and refresh their product offerings. By regularly assessing the percentage of sales from new products, 3M ensures a steady pipeline of innovative ideas while maintaining focus on customer needs and market trends. The KPI is embedded across the organization, with executive compensation often linked to performance in this area. As a result, 3M continues to push the envelope, sustaining its competitive edge in various industries.

Case Study 2: Google’s Use of OKRs in Innovation

Google’s prolific innovation engine can be attributed in part to its use of Objectives and Key Results (OKRs), which are a complementary approach to KPIs. OKRs facilitate a robust framework for fostering and measuring innovation efforts. At Google, these objectives are set quarterly and revolve around ambitious, oftentimes audacious, innovation goals.

Key Results are established alongside these objectives to track progress and ensure alignment with company-wide priorities. For instance, an objective could be to “improve user engagement on YouTube,” with key results related to the duration of video watches, number of content uploads per day, or specific feature rollouts. Through this dynamic approach, Google remains agile and enables teams to seek moonshots, while maintaining accountability and visibility into innovation activities.

Implementing and Iterating KPIs

Successful implementation of KPIs for innovation requires thorough planning, cross-functional collaboration, and ongoing assessment. Organizations should regularly revisit and refine their KPIs to reflect changing strategic priorities and market conditions. Introducing a feedback loop from employees, customers, and other stakeholders can provide valuable insights into the effectiveness and relevance of KPIs.

Remember, KPIs aren’t an end in themselves; they are tools to guide decisions and enhance innovation capabilities. It’s important for organizations to cultivate a culture of learning and experimentation, where KPIs evolve alongside innovation processes.

Conclusion

KPIs play a pivotal role in measuring innovation performance, driving accountability, and aligning efforts with strategic goals. By carefully selecting and implementing KPIs that resonate with the organization’s unique innovation context, companies can navigate the complexities of the innovation landscape more effectively. Through case studies like 3M’s commitment to sales from new products and Google’s use of OKRs, we see the tangible impact of KPIs in fostering a culture of continuous innovation. Ultimately, in this age of rapid transformation, those organizations that adeptly leverage KPIs in their innovation endeavors are better positioned to thrive and lead the future.

Extra Extra: Futurology is not fortune telling. Futurists use a scientific approach to create their deliverables, but a methodology and tools like those in FutureHacking™ can empower anyone to engage in futurology themselves.

Image credit: Pexels

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Best Practices and Pitfalls of Building an Innovation Ecosystem

Best Practices and Pitfalls of Building an Innovation Ecosystem

GUEST POST from Art Inteligencia

In today’s rapidly evolving business environment, fostering innovation isn’t just a strategic advantage—it’s a survival imperative. An effective innovation ecosystem integrates diverse elements, harnessing external and internal synergies to fuel sustained creativity and growth. But as with any complex system, crafting a robust innovation ecosystem comes with its own set of best practices and potential pitfalls. In this article, we’ll delve into both, supported by case studies that illustrate these critical points.

Best Practices for Building an Innovation Ecosystem

1. Foster a Collaborative Culture

The cornerstone of any successful innovation ecosystem is a culture that champions collaboration. Organizations must cultivate environments where ideas are freely exchanged without fear of judgment, encouraging cross-pollination between departments and disciplines. Providing platforms for collaboration—both physically and digitally—enables diverse teams to work together towards breakthrough innovations.

2. Leverage External Partnerships

In the journey to foster innovation, no organization is an island. Building partnerships with startups, academic institutions, and even competitors can inject fresh perspectives and capabilities. Open Innovation, driven by interfacing with external entities, is a key strategy many successful businesses employ to enhance their innovative potential.

3. Invest in Continuous Learning

An innovation ecosystem thrives on continuous learning and development. Encouraging employees to engage in ongoing education, whether through formal programs or earmarked “innovation time,” keeps the ecosystem agile and forward-thinking. It’s about creating a learning organization that can adapt and evolve as new challenges and opportunities arise.

Case Study 1: 3M

The Post-it Note Phenomenon

3M stands out as a paragon of innovation, with the famous invention of the Post-it Note serving as a testament to the company’s innovation ecosystem. Initially, the adhesive technology behind Post-it was considered a failure because it wasn’t strong enough for its intended use. However, 3M’s culture of openness and experimentation enabled this “failure” to be repurposed. The internal 15% rule, where employees could spend a portion of their time on projects of their own choosing, played a crucial role in nurturing this innovation.

3M’s approach highlights the value of a corporate culture that not only tolerates failure but also turns it into opportunities. By encouraging a culture where ideas can be recycled and reused creatively, 3M successfully transformed a dud product into a blockbuster staple. Their innovation ecosystem thrives on sustained encouragement of exploratory projects and cross-departmental collaborations, a model many other companies strive to emulate.

Common Pitfalls in Building an Innovation Ecosystem

1. Over-reliance on Internal Resources

A major misstep in fostering an innovation ecosystem is the tendency to solely rely on internal talents and resources, often leading to echo chambers. Without external input, solutions may be limited to existing knowledge and conventional thinking. This not only stifles creativity but also undermines competitive advantage in the long run.

2. Lack of Strategic Alignment

Innovation efforts that aren’t aligned with an organization’s overarching goals can lead to disjointed initiatives and wasted resources. Ensuring that innovation strategies sync with the broader business objectives is crucial. Strategic misalignment often results in minimal support from top management, under-funding, and ultimately, failure.

Case Study 2: Kodak

The Fall of a Giant

Kodak’s story is often cited as a cautionary tale for organizations attempting to foster innovation ecosystems. Despite inventing the digital camera in 1975, the company failed to capitalize on its potential due to an internal focus that prioritized film sales over technological advancement. This case illustrates a pitfall of missing strategic alignment and over-reliance on existing business models.

Kodak’s downfall underscores the necessity of aligning innovation with future-oriented business goals. Their internal culture, focused heavily on their traditional cash cow, was unable to adapt quickly enough to the disruptive technology they themselves had pioneered. The innovation ecosystem failed not from lack of technological prowess, but a failure to strategically embrace and integrate emerging technologies.

Conclusion

Building a thriving innovation ecosystem is a complex yet rewarding endeavor that requires thoughtful planning and execution. By fostering a collaborative culture, leveraging external partnerships, and investing in continuous learning, organizations can create a fertile ground for innovation. However, avoiding pitfalls such as over-reliance on internal resources and lack of strategic alignment is equally important. The contrasting case studies of 3M and Kodak serve as a poignant reminder that the path to innovation lies not merely in novel ideas but in the capacity to strategically harness and integrate them within a supportive ecosystem framework.

Extra Extra: Futurology is not fortune telling. Futurists use a scientific approach to create their deliverables, but a methodology and tools like those in FutureHacking™ can empower anyone to engage in futurology themselves.

Image credit: Pexels

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High-Performing Innovative Culture Case Studies

High-Performing Innovative Culture Case Studies

GUEST POST from Art Inteligencia

In today’s fast-paced business environment, cultivating a high-performing innovative culture is not just an advantage—it’s a necessity. Organizations that manage to embed innovation into their cultures can harness the creativity and problem-solving capabilities of their employees to deliver sustained competitive advantages. Here, we explore three compelling case studies of organizations that have successfully fostered such cultures. To deepen your understanding of fostering innovation in a work environment, check out my innovation strategies page.

Case Study 1: Google

Google has long been heralded as a paragon of innovative culture. With its famous ‘20% time’, where employees can dedicate a portion of their workweek to personal projects, Google encourages creativity and exploration. This policy has led to the creation of products like Gmail and Google News. Google’s culture emphasizes psychological safety, allowing team members to express ideas without fear of ridicule. To understand more about managing successful innovation programs, explore our deep dive into innovation programs.

Case Study 2: Spotify

Spotify’s organizational model is known for its flexibility and adaptability, encapsulated in what it calls “squads, tribes, chapters, and guilds.” Spotify encourages autonomous teams, or “squads”, to develop and iterate quickly while maintaining alignment with broader company goals through cross-functional “tribes”. This decentralized model enables rapid innovation while fostering a strong sense of team ownership and accountability.

Case Study 3: 3M

3M is often cited as a pioneer of innovative culture, with its commitment to innovation deeply embedded into its history. The company dedicates a significant percentage of its annual revenue directly to research and development. Known for its ‘15% culture’, 3M allows employees to allocate 15% of their working time to developing projects of their own choosing, which has been instrumental in creating breakthrough products like the Post-it Note. This approach highlights 3M’s focus on long-term innovation and sustained market leadership.

Conclusion

As demonstrated by these organizations, a high-performing innovative culture does not materialize overnight. It requires deliberate strategies, such as promoting psychological safety, decentralizing decision-making, and encouraging creative freedom. The success stories of Google, Spotify, and 3M offer valuable insights into the elements necessary to create such an environment. For more insights into innovation and culture, visit more of the articles here on the Human-Centered Change and Innovation blog.

Bottom line: Futurology is not fortune telling. Futurists use a scientific approach to create their deliverables, but a methodology and tools like those in FutureHacking™ can empower anyone to engage in futurology themselves.

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Overcoming Innovation Fatigue

Keeping the Momentum

Overcoming Innovation Fatigue

GUEST POST from Chateau G Pato

In today’s rapidly changing business environment, sustaining innovation momentum is a key challenge organizations face. While initiating innovation can garner excitement and enthusiasm, maintaining that energy over time is another matter. This phenomenon, often referred to as “innovation fatigue,” can lead to stalled projects and unmet goals. To address this, organizations must focus on creating a conducive culture and environment for innovation to thrive continuously.

“Continuous innovation requires both structural support and cultural backing. It’s not just about introducing new ideas but creating a robust framework to sustain them.” – Braden Kelley

The Innovation Fatigue Problem

Innovation fatigue occurs when the initial excitement and momentum around new ideas start to wane. This can happen due to several reasons: lack of visible progress, insufficient resources, resistance to change, or unclear goals. Overcoming this fatigue involves not only maintaining energy and motivation but also building resilient systems that support the ongoing adoption of innovative ideas.

Case Study 1: 3M Corporation

3M is often cited as a leader in innovation, with its robust commitment to continuous improvement and new product development. However, even a powerhouse like 3M is not immune to innovation fatigue. A few years back, they noticed a dip in the enthusiasm amongst teams working on R&D projects. The root cause was traced back to overly rigorous project evaluation metrics that stifled creativity and risk-taking.

To combat this, 3M revamped its approach by introducing a more flexible metric called “Failure Value.” It measured the value of learned lessons from failed projects. This shift encouraged experimentation and reduced the fear of failure, resulting in a boost of energy across R&D teams and an eventual increase in successful innovations. This case clearly shows the importance of adapting cultural and structural elements to sustain innovation momentum.

Case Study 2: Spotify’s Agile Workforce Model

Spotify has consistently stayed at the forefront of the digital music industry by fostering a culture of agility and responsiveness. To address innovation fatigue, Spotify implemented what they call a “tribe and squad” organizational structure. This model allows small, cross-functional teams (squads) to operate with high autonomy and ownership over their projects, with the support of larger groups (tribes).

With this model, Spotify ensures that teams stay motivated and aligned with larger company goals. They encourage a culture of “fail fast, learn faster,” promoting rapid iteration and learning. By empowering these smaller units, Spotify minimizes bureaucratic delays and maintains continuous innovation momentum. This decentralized structure serves to retain the intrinsic motivation of team members and foster a culture of resilience against fatigue.

Key Takeaways for Sustaining Innovation

  1. Promote a Culture of Learning: Encourage experimentation and learning from failures as much as successes to keep the team engaged and motivated.
  2. Adapt Structures to Support Innovation: Maintain organizational flexibility to quickly respond to challenges and changes without stifling creativity.
  3. Recognize and Reward Efforts: Ensure that team members are recognized for their contributions, whether successful or not, which helps in sustaining morale and participation.

In conclusion, overcoming innovation fatigue is about maintaining a balance between enthusiasm, resources, and structural support. It’s about creating an environment where innovation can thrive on an ongoing basis, ensuring that early excitement translates into sustainable progress. By learning from industry leaders like 3M and Spotify, organizations can devise strategies to keep the innovative spirit alive and well.

“Sustainable innovation is not a sprint but a marathon. To win, we must run at a consistent pace, fueled by purpose and a commitment to learning.” – Braden Kelley

I hope you have enjoyed this article diving into the phenomenon of innovation fatigue, offering two compelling case studies — 3M and Spotify — and provides actionable insights to sustain innovation momentum.

SPECIAL BONUS: The very best change planners use a visual, collaborative approach to create their deliverables. A methodology and tools like those in Change Planning Toolkit™ can empower anyone to become great change planners themselves.

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Creating a Culture of Everyday Innovation

Creating a Culture of Everyday Innovation

GUEST POST from Chateau G Pato

In today’s rapidly evolving business landscape, organizations must prioritize innovation in order to stay competitive and thrive. However, many companies struggle to foster a culture of innovation that transcends the occasional brainstorming session or special project. True innovation must become a part of the fabric of daily operations, ingrained in the mindset of every employee from top to bottom.

So, how can organizations instill a culture of everyday innovation? By encouraging and empowering their employees to contribute ideas and improve processes continuously. Here are two case studies that exemplify this approach:

Case Study 1: Google

Google is renowned for its culture of innovation, which is evident in its diverse range of products and services. One key to Google’s success is its “20% time” policy, where employees are encouraged to spend 20% of their work hours pursuing their own passion projects. This policy has led to the creation of products like Gmail and Google Maps, which have revolutionized the way we communicate and navigate the world.

Google also holds regular hackathons, where employees come together to brainstorm and develop new ideas in a collaborative environment. These events not only foster creativity and innovation but also help break down silos between teams and departments, encouraging cross-pollination of ideas.

By empowering employees to take risks, experiment, and think outside the box, Google has created a culture of everyday innovation that drives the company’s success.

Case Study 2: 3M

3M is another organization that excels at fostering innovation in its day-to-day operations. One of 3M’s most famous innovations is the Post-it Note, which was the result of a serendipitous discovery by a scientist trying to develop a strong adhesive. This accidental invention led 3M to adopt a philosophy of “innovating by mistake,” encouraging employees to explore new ideas and opportunities without fear of failure.

3M also has a program called “Genesis Grants,” which provides funding for employees to pursue innovative projects that align with the company’s strategic goals. This initiative not only incentivizes employees to think creatively but also shows that the company values and supports their ideas.

By creating a supportive environment where employees are encouraged to experiment, take risks, and think outside the box, 3M has built a culture of everyday innovation that drives continuous improvement and propels the company forward.

Conclusion

Creating a culture of everyday innovation requires more than just lip service from leadership. Organizations must empower their employees to contribute ideas, experiment, and take risks in order to drive meaningful change and stay ahead of the competition. By following the examples set by companies like Google and 3M, organizations can cultivate a culture of innovation that fuels growth, creativity, and success.

SPECIAL BONUS: The very best change planners use a visual, collaborative approach to create their deliverables. A methodology and tools like those in Change Planning Toolkit™ can empower anyone to become great change planners themselves.

Image credit: misterinnovation.com

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Building a Culture of Innovation

Where to Start

Building a Culture of Innovation

GUEST POST from Chateau G Pato

Innovation is the lifeblood of any modern organization. It propels growth, drives competitiveness, and fosters a dynamic work environment. But how do you even begin to build a culture of innovation? Here, I’ll outline key steps that can help any organization embark on this rewarding journey, backed by real-world case studies for illustration.

1. Leadership Buy-In

The commitment to innovation must start at the top. Leaders need to champion the cause, allocate resources, and create a safe environment where experimentation is encouraged.

Case Study: Google

Challenge: Google, known for its innovative culture, faced the challenge of maintaining this culture as it rapidly grew.

Approach: Leadership maintained a clear vision focusing on innovation. They encouraged risk-taking and adopted the “20% Time” policy where employees could spend 20% of their time on projects that interest them, even if they fell outside their normal job responsibilities.

Outcome: This approach resulted in several breakthrough products like Gmail and Google News, anchoring Google’s reputation as a global leader in innovation.

2. Empower Employees

Employees are often the best source of innovative ideas. Empower them by creating an environment where their voices are heard and their ideas can be freely shared and considered.

Case Study: 3M

Challenge: 3M, known for their Post-it Notes, sought to foster an innovative culture across its diversified business units.

Approach: 3M implemented the “15% rule,” allowing employees to devote 15% of their time to experimental projects. They also established Innovation Forums where employees could pitch ideas and receive feedback from senior management.

Outcome: This led to the creation of numerous successful products, including the famous Post-it Note. The Innovation Forums have become a cornerstone of 3M’s strategy, leading to continuous product development and improvement.

3. Foster Collaboration

Innovation thrives on diverse perspectives. Encourage cross-functional teams and collaboration to bring various expertise and viewpoints together.

4. Encourage Experimentation

Create a safe environment where failure is seen as a learning opportunity rather than a setback. Implement systems that allow rapid prototyping and iterative development.

5. Measure and Reward

Set clear metrics to track innovation efforts and recognize employees who contribute valuable ideas. Rewards can be both monetary and non-monetary, such as public acknowledgment or further development opportunities.

Conclusion

Building a culture of innovation is an ongoing process that requires commitment, open-mindedness, and strategic efforts from all levels of the organization. By learning from successful case studies like Google and 3M, any organization can set off on the right path towards a thriving, innovative culture.

SPECIAL BONUS: The very best change planners use a visual, collaborative approach to create their deliverables. A methodology and tools like those in Change Planning Toolkit™ can empower anyone to become great change planners themselves.

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Measuring the Impact of Innovation

Key Metrics and Best Practices

Measuring the Impact of Innovation

GUEST POST from Art Inteligencia

Innovation is the lifeblood of any forward-thinking organization. But how can we effectively measure its success? To transform innovation from a nebulous concept into a structured business function, it is crucial to establish key metrics and best practices. This article aims to provide a comprehensive guide to measuring the impact of innovation, enriched by concrete case studies for better understanding.

Key Metrics for Measuring Innovation

While financial performance is a significant indicator, a holistic approach to innovation measurement includes multiple dimensions. Below are essential metrics every organization should consider:

  • Number of New Products/Services Launched: This metric acts as a direct indicator of an organization’s innovation capability.
  • Revenue from New Products/Services: Revenue generated from recently launched products or services demonstrates the market acceptance and commercial success of the innovations.
  • Time to Market: This measures the efficiency of the innovation process, tracking the duration it takes for an idea to become a marketable product.
  • Customer Satisfaction: Customer feedback and Net Promoter Score (NPS) are invaluable in determining how innovations have affected customer experience.
  • Research and Development (R&D) Spending: This metric tracks the investment made in innovation activities, often correlated with future growth potential.

Best Practices for Measuring Innovation

The following best practices offer a strategic approach to measuring and comprehensively understanding the impact of your innovation efforts:

  • Align with Business Goals: Ensure that your innovation metrics are aligned with your organization’s broader strategic objectives.
  • Incorporate Stakeholder Feedback: Engage with stakeholders—including employees, customers, and partners—to get a 360-degree perspective on innovation effectiveness.
  • Use Balanced Scorecards: A balanced scorecard can help in evaluating innovation from multiple dimensions—financial, customer, internal processes, and learning and growth.
  • Continual Improvement: Regular reviews and updates of your metrics are crucial for keeping up with evolving organizational goals and market conditions.
  • Data-Driven Decisions: Leverage advanced analytics and data-driven insights to refine innovation strategies continually.

Case Study 1: Procter & Gamble

Scenario: In the early 2000s, Procter & Gamble (P&G) faced stagnating growth. To reignite commercial success, the company invested heavily in innovation.

Metrics and Measurement: P&G focused on the number and quality of new product launches, alongside revenue generated from these products. They also tracked time to market and customer satisfaction metrics.

Outcome: By aligning their metrics with overall business objectives and keeping a customer-centered focus, P&G achieved significant success. Their innovation pipeline led to the introduction of products like the Swiffer and Crest Whitestrips, which revitalized their market standing.

Case Study 2: 3M

Scenario: 3M has long been a pioneer of innovation, driven by a goal to derive at least 30% of its sales from products developed in the last four years.

Metrics and Measurement: The company measures the percentage of revenue from new products, R&D spending, and employee engagement in innovation initiatives.

Outcome: 3M’s innovation culture has led to the creation of iconic products like Post-it Notes and Scotch Tape. The company’s methodical measurement practices ensured they remained particularly agile and responsive to market needs.

Conclusion

Measuring the impact of innovation is essential for its sustainability and growth. By employing a mix of key metrics and best practices, organizations can not only quantify their innovation efforts but also continually improve them. The cases of Procter & Gamble and 3M illustrate that with the right framework, the transformative power of innovation can be methodically harnessed to drive significant business success.

In the fast-paced world of business, continuous innovation and its accurate measurement are not just beneficial—they are imperative. Embrace these strategies, and watch your organization not merely adapt to change, but lead it.

Bottom line: Futurology is not fortune telling. Futurists use a scientific approach to create their deliverables, but a methodology and tools like those in FutureHacking™ can empower anyone to engage in futurology themselves.

Image credit: Pexels

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