"I would rather have a mind opened by wonder than one closed by belief" - Gerry Spence

Open Innovation...or expanding the pool of brains thinking about your business problems outside of your organization...is a concept that has gained significant and recent traction.  The concept is very sound:

• From Wikipedia...Open innovation is a paradigm that assumes that firms can and should use external ideas as well as internal ideas, and internal and external paths to market, as the firms look to advance their technology”. The boundaries between a firm and its environment have become more permeable; innovations can easily transfer inward and outward. The central idea behind open innovation is that in a world of widely distributed knowledge, companies cannot afford to rely entirely on their own research, but should instead buy or license processes or inventions (e.g. patents) from other companies. In addition, internal inventions not being used in a firm's business should be taken outside the company (e.g., through licensing, joint ventures, spin-offs)

It used to be that innovation was something that happened deep in the bowels of corporate R&D departments.  Secretive folks lurked there and lived by the code of NIH or "Not Invented Here".  A motto that held that if R&D didn't think of it, then it didn't exist or wouldn't work or should be ignored.  Except a funny thing happened...the ideas started drying up.  Game changing ideas became few and far between.  More of the same survived and less of the unexpected was developed. 

And then another funny thing happened...organizations started asking people in other parts of the company for their ideas and some of them were good!  So they tried asking their suppliers and vendors for some ideas...and some of those were good too!  So they asked local universities and civic groups for some ideas...and a few of those ideas worked!  These organizations learned that the larger the pool of "thinkers," the better their odds of success.  Open innovation, as defined above, took off.

But, as corporate exuberance tends to breed carelessness, some organizations began to grab for "brass ring" of open innovation.  They were led astray by management consultants that reckoned that you can't get too much of a good thing.  Open innovation was cheap...and easy...and the next big thing!  Snake Oil Salesmen!  They convinced executives to gut their internal R&D functions and launch "Idea Markets" to the world.  Give us your ideas...whatever they are...we want them all!  And idea campaign after idea campaign began to become flooded with ideas.  More ideas than you could possibly imagine.  More ideas than people within the organization could properly consider or keep up with.  They found themselves sifting through thousands upon thousands of ideas.  Wonderful! 

And yet...a strange pattern began to emerge...they also noticed hundreds upon hundreds of duplicate or similarly themed ideas.  They found hundreds upon hundreds of ideas that were just bizarre...useless.  But even more curious were the ideas that just might do some good.  But there were hundreds upon hundreds of them.  How to choose the most promising?  They were all promising.  They had no way to filter them, compare them against others, develop them, find markets for them.  And so, after much fanfare and money, the "Idea Markets" slowly, one after another, began to fade away.  But now, these organizations had a bigger problem...their R&D functions were gone...and their idea pipeline was plugged at the front-end with no one able to free the clog.

Then one day, some very smart innovation management consultants showed these organizations that there is no such thing as an "all or nothing" approach to innovation.  Open innovation is but one branch of a well-rounded and comprehensive innovation management program.  And for open innovation to truly work, you need to have your internal house in order first as it relates to idea and innovation management.  You must have a solid and well managed internal innovation capability before seeking ideas from the outside world.  That means:

• Having a strong executive sponsor engaged in the innovation strategy of the organization
• Having a proven set of processes, tools, techniques and training for moving ideas into prototypes and, eventually, products
• Having enough resources (human, financial, time, space and capability) to adequately support the idea and innovation management system you are putting into place
• Treating innovation and idea management, not as some singular event, but as a true business discipline and strategy for growth
• Developing a list of problems and/or opportunities that the organization wants to invest money and effort into finding solutions
• Developing a strategy for seeking ideas from inside and outside of the organization
• Developing a clear and communicated set of selection and filtering criteria for idea submission and consideration to ensure the idea pool is manageable
• Determining the utilization of the closed innovation system for the research, development, prototyping, portfolio management and launch planning that you don't want your competitors finding out about
• Developing a workable system for protecting the intellectual property rights of all parties in the process

This is only a representative handful of key capabilities for a successful innovation management program, whether focused internally or externally.  To be a truly successful innovation-focused organization, you'll recognize the need to excel internally and externally.  You'll begin to learn that the outside world can help to solve your organizational problems.  You'll begin to learn that you'll need some very talented internal people to manage those ideas, and the relationships with the idea generators, to fully realize the benefits.  You'll start to recognize properly focused problem statements that serve as pre-built filters against many of the more useless ideas.  You'll recognize areas of weakness in your internal development areas and growth strategy that can be "covered" using outside help.  You'll carefully move the most promising ideas back within the secrecy of the R&D areas so that further development can continue free of your competitors "spying eyes."  You'll begin to see global trends faster.  You'll appreciate the uniqueness that your talented team brings to the ideas that are developed.

In the end, you'll avoid opening yourself up to innovation failure.  You'll have an open strategy, a closed strategy and an strategy in between.  It won't matter anymore where the ideas come from, it will only matter how to you exploit them.  You'll become a true "innovator."  So, get your internal house in order first, then figure out what you want the world to help you solve, and then become educated on how best to leverage those billions of fertile minds!  Good luck!

"Don't make excuses.  Make things happen." - Doug Hall

There is a constant hum around innovation today.  Organizations everywhere talk about it incessantly.  "We need to be more innovative."  "Innovation is the key to top-line growth."  "Innovation is essential to success."  Blah, blah, blah....

All that talk would be great if it was actually backed with action.  Unfortunately, the talk is much more common than the actual "walk" or action taken to make innovation happen.  It is a frustrating, but not insurmountable, problem.

This propensity for inaction (paralyzation?) started becoming more clear as I've been catching up on a number of reports, survey findings, white papers, etc. regarding how organizations (mostly Fortune 500) are leveraging innovation (or not) within their organizations.  A common theme across all of these reports and survey results are that executive and senior leaders claim to understand the importance of innovation, ideas, new product development and so forth on the ability to influence top-line growth.  There also seems to be a solid understanding that, without top-line growth, they will eventually fade into obscurity.  So far so good right?  Hmmm.....

Almost immediately following the Executive Summary section of these reports, we start getting the excuses on why the "ideal state" of growth via innovation isn't actually being followed within their organizations:

• Pressure from "Wall Street" and investors on cost reduction
• Pressure from "Wall Street" and investors on a quarterly-focus instead of long-term strategy
• Don't understand, or have immaturity surrounding, the process of innovation and extracting value from ideas
• Poor climate/culture for ideas and innovation
• Limited funding for an innovation-related portfolio

Nutshell version:  "Waaaaa....innovation is too hard....waaaaaa......."

Yes, it is hard.  Just as hard as driving out waste to reduce cost.  Just as hard as developing an effective marketing strategy to engage customers.  Just as hard as having a stable and effective IT infrastructure.  Just as hard as recruiting new talent and reducing turnover.  Just as hard as managing day-to-day operations that keep products going out the door. 

You see, it isn't any harder than any of the other functions you need to keep your business running efficiently, effectively and, hopefully, profitably.  The problem here is that executive and senior leadership in these organizations don't see innovation as a true business process.  They continually look at it as an event.  An event that you only trigger when you need to develop the next big thing or product line.  An event that is all too often stopped when the economy goes South. 

But let's focus on the excuses for a moment...and then punch a few holes them:

• Pressure from "Wall Street" and investors on cost reduction
  • This is a pressure you inflict upon yourself.  You do not need to be a slave to the pressures of "The Street".  You choose to because you have limited your definition of "success" to the stock price.  Eventually, even "The Street" wants to know if you have any plans to add some top-line growth or they'll dump you faster than your worst nightmare.  The short-term reward of cutting costs only lasts until you've run out of stuff to cut.
• Pressure from "Wall Street" and investors on a quarterly-focus instead of long-term strategy
  • See above...and take a step back to look at the entire forest to which your organization belongs, not just the 12" by 12" piece of tree trunk at which you keep staring.
• Don't understand or have immaturity surrounding the process of innovation and extracting value from ideas
  • Okay...this happens.  But when you sought out help in getting lean and eliminating waste, you turned to the SixSigma Black Belts right?  And when you needed that unique new plan to grab market attention, you turned to Marketing Analysts right?  So why does innovation, R&D, growth strategy have to be any different?  It doesn't!  Find an expert, hire them and learn how to get better!
• Poor climate/culture for ideas and innovation
  • As a leader, you set the climate and culture.  Period.  So if you struggle here, its your own fault.  Again, it happens.  When you focus too much in one area for too long (cost cutting) you begin to slowly shift the culture in that direction.  It can be completely inadvertent...but it happens.  Encourage people to learn about the problems that your organization or your customers face.  Encourage them to submit ideas.  Show them you are listening.  Reward them.  Recognize them.  Allow them to take risks and fail.  Develop the burning platform for change.
• Limited funding for an innovation-related portfolio
  • Times are tough.  No argument here.  But, you get results where you put your money and resources.  So if you REALLY believe that "Innovation is the key to success" like your recent shareholder letter claimed, then put some money where your mouth is!

Innovation only happens when organizations "talk the talk" AND "walk the walk."  No one is going to hand you the "next big thing" or that bit of competitive separation or your future profit generator that only exists in someone's head right now.  You have to deliberately search for the "next big thing."  You have to carve out your competitive advantage by offering something unique.  You have to help that person with that great idea get it out of his/her head and into your customers hands.  You have to live the Think For A Change, LLC. motto..."Imagine the future...Make it happen"

So stop making excuses, and start making it happen today!

Need help?  Call me...email me...send me a question on a piece of duct tape....but do something!

"The way to get started is to quit talking and start doing" - Walt Disney

Sometimes it can be hard to get past the point of "thinking about solving the problem" or "trying to solve the problem" and actually "solving the problem."  So, I've put together twelve concepts that will get you to take action, once and for all, on creating and executing upon an innovation management approach for your organization.

January - Stop taking orders and start finding solutions.  Ask "How do you do things now and how can we do those things better?"  Become a partner in solving the real problem vs. just blindly producing what the customer thinks they need.

February - Innovation is hard work.  Stop pretending that it is the result of a few geniuses in your organization.  Set up appropriate resource assignments.  Break the work down into manageable pieces.  Challenge everyone, from the CEO to the Receptionist, on finding problems to solve and coming up with the ideas that solve them.

March - Don't "forecast the future."  Understand that you invent and create the future.  You have more control over the future than you know.  You need to be thinking beyond this quarter and into the next, and the next, and the next.  You need to create the "next big thing" before your competitor does.  "Imagine the future...Make it happen"

April - Create effective and efficient processes, but be flexible.  Create a process for challenging people to come up with ideas.  Create a process for gathering and considering the ideas.  Create a process for testing the ideas.  Create a process for figuring out if the idea will make money.  You get the idea.  But be flexible...rigidity kills innovation.

May - Be clear on what innovation means to you and your customers.  Innovation is one of those terms that can take on multiple meanings.  For me, it means anything new that provides value to someone.  New can mean "new to you" or "new to your customers" vs. "new to the world."  The idea here is to define and document it so there is no confusion.

June - Focus on your internal structures.  What is the make up of your innovation team?  Would you be better served by an Innovation Center of Excellence model instead?  What about process, governance, resources and leadership engagement?  Are you helping people or getting in the way?

July - Think about a portfolio approach to managing your innovation pipeline.  Each idea you decide to invest in should be carefully considered for risk and "audacity."  Spread your idea funding budget across safe bets, probable wins, maybe wins and long shots within your portfolio of development projects.  Use these "levers" to adjust overall direction based on risk tolerance, economic reality, etc.

August - Lead, don't follow.  The pursuit of "best practices" is important when you are playing catch-up to your competitors.  But once you've caught the pack, take the lead with "next practices."  This requires a lot of courage, so be prepared to fight the risk-averse within your organization.  Let your competitors pursue your "best practices."  Be a leader!

September - Data lies.  Don't forget this very, very valuable point.  Data can be constructed to tell you whatever you want to hear.  Use "quantitative data"...as it tells one part of the overall story.  But don't fall down and genuflect to it.  Give equal weight to "qualitative data."  It tells another, just as important, part of the overall story.  Bottom line = Consider the facts, trust your intuition.

October - Become a trend hunter.  Scan your surroundings.  Pick up on the soft signals of momentum.  What is hot at the fringe?  What is potentially cyclical that may be ready for a come-back?  What are the geeks excited about and working on?  What is coming and what has already moved on?

November - Demand executive leadership engagement, not just support.  Innovation Management should be treated as a business discipline...no different than Marketing, HR, IT, Finance or Legal.  Innovation is not a one-time event at some posh off-site.  Executive leaders should be challenged to walk the talk.  They should be part of idea gen sessions.  They should sit on Idea Boards to hear and decide on the fate of new ideas.  They should be engaged in setting the appropriate mix of development projects in the project portfolio.

December - Be an effective resource manager.  That means you are making sure you have enough people in the right places doing the right things that they are passionate about...human resources.  It also means you have adequate amounts of funding to run the program, provide seed money to promising ideas and launch larger projects for idea execution...financial resources.  It means making sure that you carve out time for people to think, to come up with ideas, to search for problems to solve...time resources.  Finally, it means setting up places to think, to get away from the constant rush of "right now" work, to be challenged creatively, to use tools designed to help solve problems...location resources.

Remember, you want to manage the work vs. the work managing you.  Use these tips to gain control of the idea and innovation management system in your organization.  Take control and make it work for you!

"There is no shame in not knowing...the shame lies in not finding out" - Russian Proverb

What makes up a good idea management system?  Obviously, coming up with great ideas...or "finding solutions."  But shouldn't you apply just as much effort into making sure you have the right problem...or "finding problems?" 

Making sure you understand and define the problem you are attempting to solve is the first step (some would say the MOST important step) in the problem solving model.  For a brief refresher on the problem solving concept, here is the Think For A Change, LLC. Idea Management Model:


Notice the first section...Problem Identification.  How can you go to step 2, or Idea Generation, if you don't have a good handle on what you are trying to solve?

There are a number of methods and techniques surrounding problem identification including: 5 Why's, Ishikawa (Fishbone) Diagramming, Mind Mapping, Customer Ethnography, Voice of the Customer, etc..  These are all great tools for getting to the root cause of the problem.  You should also have a number of things that you have identified that are holding your business back.  Every good leader has a list of issues he or she would love to solve in order to improve things.

So...you are asking..."why is this all important?"  Because I find that there are many organizations who continually ask employees, vendors, customers or anyone else who will listen, for solutions to problems that may not actually be the organization's real problems.  What's worse, sometimes they ask for solutions to problems that have already been solved.  Now you are saying, and most likely rather incredulously, "We certainly do not ask for solutions to problems that are already solved."  Really? 

Well...isn't that what you are doing by having your suggestion box hanging in the break room?  Or with that "Click Here to Submit Your Idea" button on your website?  You are essentially asking people to "come up with ideas to improve the company" or maybe the super-well-defined, "give us ideas on how to save money" or my personal favorite, "how can we generate more sales?"  Not really focused is it?  If you're lucky, you'll get about 200 worthless ideas for every 1 idea that might have some real business benefit.  But mostly, you'll get stuff that has little to no impact on your organization.

So, how do we make this situation better?  Targeted idea campaigns. 

Once you have a solid understanding of the problem you'd like to solve, you can organize your target idea generation audience around solving a specific idea challenge.  Now, instead of getting ideas like, "Add low-fat vanilla creamer to the breakroom" you get ideas like, "draft a photographic product features/measurements binder for salespeople to share with potential customers."  That is, if your targeted idea challenge was about "helping customers make better decisions on sizing requirements at the time of ordering."   Detail wins the game here.  If you want specific, actionable ideas...you need to be specific and detailed in the question you are asking.

With this approach, you also avoid "idea burnout" where people just throw out the ten things that bother them the most and then they stop contributing because they are out of ideas.  With a more focused approach, you can limit the number of idea challenges running at any given time.  You can also keep the problem finding exercises staggered and therefore, the search for solutions continuous.  You keep the ordinary idea contributor engaged by having them think about specific issues/problems.

Here is a "Next Practices" alert...I have worked with some organizations that have separate teams who search for problems to hand off to other teams that search for solutions who sometimes come up with new problems which they hand back to...well you get it...its circular.  In fact, all good idea and innovation management programs are circular and continuous. 

So...are you Problem Finding or Solution Finding or BOTH!?!?!

"A project is a problem scheduled for a solution." - J.M. Juran

I am frequently asked how I am able to balance the seemingly contradictory disciplines of idea/innovation management and project management.  After all, the whole concept of idea/innovation management is about loosening control on people's thoughts, ideas and problem solving ability, while project management is wrapping a certain amount of rigor around producing a carefully selected set of deliverables within an established schedule, budget and level of quality.  Right?

Well, sort of.  Actually, idea/innovation management is about setting in place repeatable and reliable processes that foster a culture and climate of problem identification, problem solving, new ideas, risk taking, fast failure and prototyping.  Through this culture/climate, and with engaged leadership and a sufficiency of resources, the most promising ideas are brought into reality.

And reality is where project management works best. 

The discipline of project management is nothing more than the set of tools and techniques designed to define what needs to be done...by when...at what cost.  Okay, okay...there is a lot more to it than that!  There are risk management strategies to consider.  Scope needs to be broken down into deliverables, which need to be broken down in to tasks, which need to be estimated and assigned.  Then there is the financial management of the project, along with tracking earned value.  Quality, resources, issues, performance, documentation, communications and a myriad of other process control mechanisms add to the complexity.

But, in the end, project management is about the orderly resolution of a problem.  Or...making an idea a reality.

And it is at this intersection, where the "fuzzy front end" of finding problems to solve and coming up with ideas meets the "serious back end" of moving the idea into a reality where a real problem is solved...hopefully to the benefit of someone!

I've included a presentation (below) that I gave a few years ago at the ProjectWorld/World Congress of Business Analysts that more visually describes this concept.  Enjoy!

Innovation & Project Management - Partners in Growth

As is customary now on the Think For A Change Blog, I like to re-publish this blog entry from 2006 as a reminder of the importance of just sitting down and thinking every once in awhile.  Incubation, thinking, meditating or reflecting, whatever you call it, is indeed the innovator's secret weapon.  The purposeful search for problems and solutions puts you at a great advantage!

In a recent meeting with a client for whom I frequently do some innovation management maturity consulting, he mentioned that this particular blog entry has always stuck in his memory.  "It made perfect sense," he said, "because my people are going to be taking a week or two off during this holiday season and, whether they realize it or not, they will be thinking about their problems at work."  So together, for this year, we established a special idea incentive program.  For every idea each employee comes back to the office with on January 4th, 2010, they will receive 1 dollar to spend at the company store.  In the words of my enlightened client, "I can't really ask these folks to think about improving my company during their time off, but if they do, and they want to share those ideas, I think it is appropriate to pay them for that effort."

Additionally, with the recent passing of Roy E. Disney, who saved the Walt Disney Company more than once due his demand that the organization never forget where it started, the re-print of this blog entry seems all the more timely. 

Enjoy...

                              ________________________________________________________

                                                                     
Walt Disney wrote in Reader's Digest (December 1941) that:

"One reason the Christmas season appeals to me is that it makes us suspend business-as-usual routine and let our minds soar for a while. It is a time when the imagination is more sprightly than at other periods of the year; Christmas seems to release even the most solemn of us from the Scrooge realism that occasionally besets all of us. It is natural,of course, that I should think of Christmas in terms of imagination,for imagination is my business."

Hopefully you have some vacation time to spend with family and friends this Christmas and holiday season. If not, you'll still be treated to a quiet office, what with all of the other people being off. 

Walt's quote above reminds us that we must all find some quiet moments from time to time. These quiet moments allow our subconscious time to catchup with our busy conscious mind.  The subconscious probably has some ideas it has been working on, but hasn't been able to get through to us during the busy end of the year activity.

So how do we take advantage of the power of reflection? 

• Think on a scale larger/smaller than what you are used to thinking
  • See the forest for the trees
  • Look for patterns
  • Look at how nature solves "problems"
  • Do something you typically don't do
  • Try to (not to) generalize everything you encounter
• Ask questions
  • What if...?
  • How about...?
  • How can we...?
  • Why not...?
• Create Time
  • If you can't find time in your busy day for reflective thought, make time:
    • Get up one hour early
    • Go to bed one hour late
    • Go to the park for lunch
    • Listen to music instead of the news
    • Take a long shower or bath
    • Cut the grass
    • Take the dog for a walk

In today's hectic rat-race, it can be very difficult to find time for reflective thought and getting in contact with our sub-conscious.  New ideas typically don't present themselves when we are too busy to think.  In order to truly tap into your great, but yet unknown ideas,make time to get away, think deeply, and truly reflect on your problems, potential solutions and other great thoughts.

To all of my blog readers, clients, colleagues and friends...Merry Christmas and Happy Holidays!!!

Did you know that you can now subscribe to the Think For A Change Blog on your Amazon Kindle? 



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"We don't know who discovered water, but we know it wasn't the fish" - Marshall McLuhan

I received some great email and comments on the recent "What Will The Customer Buy?" blog entry.  A disturbing theme arose, however, in those comments.  Customer ethnography is too hard...It is too expensive...It requires specialized experts or consultants...Customers and employees are too close to our products to think of new things.  Wrong...Wrong...Wrong...and....Wrong!

Here is a three step process to learning something brand new about your organization, your products and your services through the eyes and ears of your customer:

Step 1 - Be the customer

• Are your employees customers of your own organization?  Are you sure?  Why are they?  Loyalty?  The best products/services available?  Self-serving interests?  Why don't they?  What does that say to others who know that employee...others who are potential customers?
• Call your customer service line and be a customer.  What kind of experience do you get?  Do this at different times of day.  Do you get different experiences?  Is that a problem?  Do the same with your order taking/sales entry points.
• Walk in the front door of your business like a customer.  Experience your physical surroundings like a customer.  Anything annoy you?  Anything not feel or look right?  Anything that sets your organization apart from the competition?
• Be a customer at every single entry point into your organization.  Online, phone, brick & mortar, etc.  Are there any other places you could be interacting with customers?  Are the existing entry points easy, helpful and efficient?

Step 2 - Adopt a customer

• We all have them...the "favorite" customer.  You would do anything for this customer because this customer would do anything for you.  Well...take him up on that offer!  Ask him if it would be okay if you had a team of people follow him home for a day or two.  Just to watch how he uses your products, where he has a need for your services, how he may use your products/services in ways you never dreamed of, how he has developed "work arounds" to the short-comings of your products
• Do some real research by placing survey takers outside of your biggest competitors and asking their customers why they do business with them instead of you.  Ask them if they are even aware of what you have to offer.  Ask them if you can observe how they use, have a need for, use in unexpected ways or have developed work arounds to your competitors products/services.
• Do you have some innovative new products in the pipeline?  Good!  Since the economic meltdown, most of your competitors don't...so you are ahead of the game.  Get prototypes of these products into the hands of your adopted customers!  Get feedback now!

Step 3 - Learn and Create

• Now that you have "customer ethnographic data points" (sounds fancy doesn't it?) you can begin to transform the data into ideas.  Ideas, via your idea management system, start to get refined into actual business concepts.  Business concepts, via your innovation management system, start to become opportunities for research and development prototypes.  Research and development prototypes, via your new product development system, become products and services.  Products and services, via your production, marketing and sales systems, become the lifeblood of your organization and provide the profit necessary to invest in finding new ways to gather "customer ethnographic data points" to start the process all over again!

There...was that really so hard?  Much of what I have described here isn't even going to cost you a dime!  You just need to take that first step and aggressively go out and find problems that your customers will pay you to solve!

"When you plant a seed, you don't dig it up every week to see how its doing" - Unknown

It never ceases to amaze me how impatient corporate executives can be.  Of course, most are driven by the need to deliver quarterly results for shareholders and Wall Street analysts.  I get it...really I do.  But growth cannot be put on such a strict timescale.  Growth takes time.  Growth is like the seed referenced in the opening quote above.  It requires patience, water, food and more patience.

Innovation is the engine for growth.  Innovation comes from ideas.  Ideas take time to develop.  Ideas tend to change as they grow.  Ideas need to be prototyped and that takes time.  Ideas need to be matched with problems that need solving and that takes time too. 

Did you know that most product development lifecycles require 12-24 months from concept to release?  When you have executives focused only on the next 3 three months, it can be difficult to get any "airtime."  But good executives, the one's who really understand that growth means that their business will be around in 2 or 20 or 200 years, do focus on what interesting things are coming out of the new product/service development cycles.

The trick, and it really isn't a trick, is to have a staggered and constant product development system.  If you start everything now, at the same time, you will arrive in the future with everything released around the same time.  Let's be honest, you don't really have the resources necessary to start everything at the same time anyway do you?  Nope!  But what you can do is start some of the work now, then start some more 6 months from now, then even more 6 months from then.  See how this works?  Staggered, yet constant, delivery of new products/services coming out of the bottom of the development funnel. 

Even smarter executives understand that even more patience is required when trying to fill the top of that funnel.  Ideas come from deliberate thought about problems.  Figuring out which problems to solve requires a lot of brainpower as well.  Executives and leaders focused on growth and the future allow for time to envision the future, they walk around to search for problems to solve, they create quiet time for idea incubation, they encourage fast failure via prototyping ideas to see if they will actually work and they provide the most promising ideas with a little seed money.

Time is a precious commodity.  Another one of my favorite time-related quotes comes from Harvey MacKay, "Time is free, but priceless.  You can't own it, but you can use it.  You can't keep it, but you can spend it.  Once you've lost it, you can never get it back."

Think about that as you look ahead to next year.  Are you carving out enough time for ideas and innovation?  Are you patient?  Are you the person that digs up the seed every week to check on its progress only to discover that it never grows? 

"If you're not serving the customer, you better be serving someone who is." - Karl Albrecht

In the world of innovation management and new product development, there is a lot of ongoing discussion on how to discover what the customer needs, wants, will pay for, will follow along like lemmings, etc. 

Many times, the discussion starts with "Voice of the Customer" or VOC, which honestly has many definitions, but here is a common one from Wikipedia...

Voice of the Customer describes the process of capturing a customer's requirements. Specifically, the Voice of the Customer is a market research technique that produces a detailed set of customer wants and needs, organized into a hierarchical structure, and then prioritized in terms of relative importance and satisfaction with current alternatives. Voice of the Customer studies typically consist of both qualitative and quantitative research steps. They are generally conducted at the start of any new product, process, or service design initiative in order to better understand the customer’s wants and needs, and as the key input for new product definition, Quality Function Deployment (QFD), and the setting of detailed design specifications.

In general, there are a number of weaknesses with this approach as it relates to new product development and innovation management.  This is because customers are very poor at envisioning the future.  They are more interested in getting their hands on improvements and upgrades to things they know already work.  They cannot see the things they "may" want in the future. Stuff like cars...when horse and buggies worked fine.  Stuff like iPods...when the portable CD player worked fine.  Stuff like text messaging...when the cell phone worked fine.  If what you are looking to get are incremental improvements, this is a great tool.

Another way to look at discovering the needs and wants of a customer is something called "Customer Ethnography" which is defined as:

Ethnographic studies are usually holistic, founded on the idea that humans are best understood in the fullest possible context, including: the place where they live, the improvements they've made to that place, how they are making a living and providing food, housing, energy and water for themselves, what their marriage customs are, what language(s) they speak and so on.  One of the most common methods for collecting data in an ethnographic study is direct, first-hand observation of daily participation. This can include participant observation.  (Wikipedia)

Ethnographic studies are very useful for discovering what the customer currently struggles with, desires to have, has already developed work-arounds for, etc.  This leads to new insights in what "job the customer wants done" and will hopefully pay for to get done.  For example, watching customers struggle with with messy brooms and dust pans led to the development of Proctor & Gamble's Swiffer product.  There was no existing customer demand, or pull, for this product.  But it solved a customer's "job to be done" of efficient cleaning.

Yet another method of using customers in your innovation research is the usage of "Focus Groups," which are defined as:

A form of qualitative research in which a group of people are asked about their attitude towards a product, service, concept, advertisement, idea, or packaging. Questions are asked in an interactive group setting where participants are free to talk with other group members.  Focus groups allow companies wishing to develop, package, name, or test market a new product, to discuss, view, and/or test the new product before it is made available to the public. This can provide invaluable information about the potential market acceptance of the product. (Wikipedia)

Focus groups are typically used once an idea has already been prototyped.  Outcomes from the focus group then drive additional changes, ideas, new directions, etc.  Results of focus groups are very subjective.  Skilled focus group leaders and facilitators are required to reduce the common pitfalls associated with focus groups.  Despite these ominous warnings, focus group sessions are a very valuable tool in the product development lifecycle and for innovation management in general.

The last method we will look at in our search for finding out what the customer will buy, is to just put the product in their hands.  It is called "push innovation":

Push Innovation occurs when a new invention, technology, process is pushed through R&D, production and sales functions onto the market without proper consideration of whether or not it satisfies a user need. (Wikipedia)

Push innovation happens when new technology is discovered and developed into a new product or service regardless of customer demand.  Great examples are iPod/iTunes and Facebook.  Advances in technology, business models and services made those innovation success stories happen.  It was pushed into customer's hands and the customer quickly embraced them.  Many, many other products are pushed into customer hands that are just as quickly dropped or ignored.

In the end, and by definition, innovation happens when a new idea delivers a value for which someone is willing to pay.  Sometimes that "someone" knows what they will pay for and therefore, will pull it out of organizations that produce products/services.  Sometimes that "someone" has ideas around changes, improvements and extensions.  Sometimes that "someone" needs to have it "pushed" or handed to them in order to discover the value.

Remember...without a product or service that provides value, you have no customer...and if you have no customer, you have no business!

"Vision reaches beyond the thing that is, into the conception of what can be.  Imagination gives you the picture.  Vision gives you the impulse to make the picture your own." - Robert Collier

It can be very difficult for a person to describe the idea that is floating around in their head.  They can see it so clearly.  It makes perfect sense.  It works seamlessly with other tools/processes.  If only you could see it!

Being able to visualize or create a hands-on model of your idea is the first step in making it "real."  If the idea is more conceptual, like a business process improvement or service innovation, I turn to the "Periodic Table of Visualization Methods":

               

This incredible online tool, created by Visual Literacy, is a treasure-trove of visualization methods that is sure to spark the imagination of anyone having difficulty putting their ideas down on paper in an organized format.

There are, of course, other methods for making the connection between concept and reality.  Physical models and prototypes, even crude foam blocks, create a tactile and visual impact.  For those of you who have enjoyed the attraction, Soarin', at either Walt Disney World's EPCOT or Disney's California Adventure, that entire concept was prototyped using an Erector Set!  In the software development world, prototyping via Agile and XP methods are the norm.  In your line of work, I am sure you have ways of communicating concepts without building the whole thing. 

So here's the point I want to make...an idea isn't real until you do something with it.  If the idea remains in your head, it isn't real.  You have to communicate what that idea is...what it does...what it looks like...how it works.  Until you do that, it isn't real.  Make your ideas real!

"When you don't know where you are going, any road will take you there." - from Lewis Carroll's Alice in Wonderland

Once again, its that time of year when organizations begin to take stock of where they have been the past year and start looking forward in an attempt to predict the future that awaits them in the new year.  Executive retreats are held.  Special strategy-focused Board of Director meetings are conducted.  If you are really efficient, goals and objectives are cascaded down through the ranks.

So how do you envision the future?  Where do you start?  Do you conduct "Voice of the Customer" sessions?  Do you task your marketing area to conduct some customer ethnography where you watch how your customers (and your competitors customers) use and "misuse" products?  Do you watch larger societal trends in purchasing, saving and investing?  Do you trend watch at a more micro-level where your product line works and plays?  Are there industry or other professional conferences that you and your team can learn about new areas of research and exploration?  If you are a smart leader who considers future growth as the only long-term survival mechanism, you'll invest in all of the above.

So what do you do with all of that future-focused information?  Do you increase funding in process improvement to ensure your day-to-day operations are lean and mean?  Do you focus on extending some product lines to squeeze some more profit from them?  Do you place a few big bets on that new product platform you discovered after watching customers struggle with a particular task that your organization is uniquely qualified to deliver?  Do you add some bonus incentives and other resources to the bleeding edge research your R&D area has been begging for all year?  If you are a believer in the "Balanced Innovation Portfolio" you are going to say yes to all three.

But lets drill down even further.  Down to the operational processes that move ideas and other new areas of thinking into reality.  How do you establish a working system for innovation...or an innovation management system?  How about a roadmap?  The strategic tool that visually depicts each stepping-stone of gradual change from one state of business reality to another.  Here is an example of a roadmap that builds, step-by-step, an Innovation Management Program:



You can also have a roadmap of projects...a roadmap of product development...a roadmap of product lifecycle...a roadmap of continuous improvement...a roadmap of technology upgrades/releases...a roadmap of strategic research...

During my recent visit to 3M to learn more about their approach and dedication to innovation, noted Corporate Scientist Andrew Ouderkirk walked through 3M's "Forward Mapping" concept where product scientists envision all possible future uses of a technology platform.  This exercise helps the leadership keep one eye on the future, while keeping the other eye on maximizing current profit on the product/technology platform.  Jeffrey Phillips, via his Innovate On Purpose Blog, covered this topic well, so please click HERE to learn more.

Find a way this year to incorporate some of the future-focused exercises mentioned here into your overall strategy planning.  Plan for the future.  Make a well-rounded bet.  By that I mean some safe bets on things you already excel at, some medium risk bets on things you are confident will succeed and some high-risk bets on breakthroughs that may or may not pan out.

Remember, you cannot predict the future, but you can make some very educated guesses.  It is not a "dart board" exercise.  It is a deliberate exploration of what is likely to come based on trends.  Remember the Think For A Change motto:  "Imagine the Future...Make it Happen"

Wharton released an interesting article this week called "Can Lean Co-Exist with Innovation?"

In essence, the article walks through how Lean and Innovation play contributing roles in the complete product development lifecycle.  Overall, it is a fantastic article, but there are a few key points in it that I think we should explore and discuss further:

"There is intense pressure to cut costs, and companies waste a lot of money on product development because the processes for accelerating the best ideas and terminating low-value ideas are often weak or non-existent"

There is indeed intense pressure to cut costs.  No question about that.  But once you pick the "low hanging fruit," the cost/benefit of lean process improvement declines rapidly as the effort required to gain the same amount of cost savings increases.  So, in order to increase the bottom line, growth strategies (new sales, increased profit, increased market share, etc.) must be pursued.  Additionally, the reference to companies "wasting" a lot of money on product development is misleading.  Organizations that not only accept, but embrace failure do not view it as "waste."  Instead, they see it as a learning experience in the pursuit of new products and services.  A learning experience that their competitors do not currently have. 

"Most people focus on ideas but not necessarily on what it takes to bring those ideas to market, and which ideas will make money"

I agree with this statement 100%.  There is too much focus on hanging onto ideas that will never turn into "innovations" because they cannot be sold or do not provide a useful purpose.  In the "back-end" of the innovation process, where manufacturing and commercialization take place, I believe that Lean/SixSig has great benefit.  But what Lean/SixSig proponents always discount is the importance of that "focus on ideas."  Without the idea, you don't have anything to improve.  Also, don't forget that just because an idea doesn't solve a problem today...that doesn't mean it won't solve a problem tomorrow.  Keep all of those ideas handy and searchable!

"Lean is a natural fit for process innovation.  Lean rarely comes into play in the first stage of product innovation and really begins its journey when an organization attempts to hear the voice of the customer."

Can we just stop pretending that "voice of the customer", as defined by our friends in the Lean/SixSig camp, works in the idea/innovation management construct?  I think this horse has been beaten enough.  VOC just doesn't apply to early stage or even middle stage innovation efforts and only leads to incremental innovations like line extensions.  Want real customer insight?  Research the growing field of customer ethnography.  Incremental innovation aside, Lean also has dubious connections to process "innovation" but is, as I have said before, my preferred tool set for process "improvement."

The article specifically references 3M prior to this statement, "Six Sigma clearly has its role in an organization, but excessive adherence to it will kill innovation; people are not going to deviate from the norm and you won't have innovation."

Here's an interesting conversation that our Innovation Influencers group had with our gracious 3M hosts related to this topic.  Jeffrey Phillips from OVO asked about the impact that former 3M CEO Jim McNerney's introduction of the GE SixSigma playbook had on the organization.  3M Foundation Chairman Alex Cirillo admitted that the R&D organization tried to protect itself and continue as normal, but the singular process methodology focus did have a negative impact.  What I found to be even more enlightening, however, was the comment from Mr. Cirillo that, without Lean and SixSigma principles in place on the manufacturing side, they wouldn't have been able to grow as fast and put more of the ideas coming out of R&D into the market.

Can Lean/SixSig and Innovation Co-Exist in the same organization?  Absolutely.  They can and should. 

Can Lean/SixSig and Innovation Co-Exist in the same product development process?  Only if you mean "co-exist" in the sense that front-end innovation activities like future scanning, idea generation, early stage prototyping, idea combinations, market push/pull opportunities and customer ethnography should employ idea/innovation management process tools and NOT include Lean/SixSig rigidity, while back-end innovation activities like manufacturing, marketing, commercialization, product testing, voice of the customer, line extensions and end-of-life planning should be held to strict Lean/SixSig tolerances to ensure efficient and effective execution.

I was incredibly fortunate to be one of a very select handful of innovation thought-leaders invited to the 3M Customer Innovation Center yesterday for a behind the scenes look at how and why 3M innovates.  This visit moved me in a totally unexpected way.  As a person passionate about innovation and ideas, I have always used 3M as a shining example of one of the elite few organizations who champion innovation as a true business strategy.  But, until yesterday, I didn't have a real hands-on understanding of the depth of just how much 3M "gets it."  I was not prepared to meet so many people whose passion and dedication to innovate matched mine.  So many organizations say they want to be innovative and trample new paths that you can get lost in the artificial euphoria.  When confronted with legitimate and deeply sincere euphoria...it can catch you off-guard.  And that is where I was as I sat at the Minneapolis-St. Paul airport last night...collecting my thoughts...trying to figure out why I had been moved so much.

So let's explore some snapshots of things that really took me by surprise yesterday:

1. The day was led off by Chief Marketing Officer Robert McDonald on how important innovation is to 3M and how/why it gives them a competitive advantage.  Okay...you could pretty much predict something like that right?  A senior executive reading the company cheerleading message to start the day.  But...here's where I was taken aback.  He stayed with us the entire day.  The CMO of a Fortune 100 organization spent the ENTIRE day with 6 innovation thought leaders to share 3M's passion and learn from our passion.  And he didn't just tag along, he was FULLY engaged.  Sharing stories.  Asking very educated questions about innovation management strategy.  Helping us "play" with 3M's products.  Impressive.
2. The VP of Corporate Research, Larry Wendling, walked us through 3M's Pillars of Innovation.  I'll list these "pillars" in a moment, but what really struck me, and continued to do so all day, was just how invisible (or maybe seamless) the innovation process is at 3M.  They don't talk about where they are in the process, how to move from one step to another, who owns what piece of the process, etc.  They just all have this collective understanding of how, what, who, when and where things need to progress along the innovation management path.  Everyone knows it because everyone lives it and the leaders facilitate it.  As promised, here are specific 3M's Pillars of Innovation:
   • Research & Development
   • Corporate Culture
   • Diversified Technologies
   • Networking
   • Recognition
   • Measurement
   • Connection to the Customer
3. I never understood just how many products in the world are either direct-branded 3M products or have a 3M product in them.  And nowhere was that made more apparent than the "World of Innovation" center.  If 3M was going for the "WOW!" factor...they certainly succeeded.  This is a Disney-esque Museum of Science and Industry, complete with plantetarium-style presentation  and dozens of individual technology platform exhibits with hands-on examples of products, services and processes.  Again, you could expect an organization to have a flashy showcase of products.  But what made this stand out is its real purpose.  3M put this center together not to show off, but to stimulate thought.  When customers come in to partner with 3M on new products, they are first brought through the center as a kind of creativity exercise.  Customers are encouraged to make connections between available technology platforms.  Yeah...WOW!  Get your customer to help improve their own products via a unique combination of 3M products.
4. Following an engaging lunch where we shared "war stories" of innovation management, we were treated to a nice presentation about breakthrough innovation by Corporate Scientist Andrew Ouderkirk.  Honestly, he was preaching to the choir with this presentation.  But what was extremely valuable, and what caused me to be the most impressed with 3M's innovation approach, was how deep and broad 3M's internal network reaches.  This is a culture that is built from the ground up via networking.  Have a problem...call someone in your network.  They don't know...they will connect you with someone who does.  And this goes top to bottom folks.  I really believe that any entry level scientist would be hooked up eventually with the CEO if the CEO had the answer that was needed.  That's unbelievable rare.  Not only that, it goes horizontal too.  There are no silos at 3M.  At least in the technology and R&D areas.  Want one more advantage of the network?  Its easy to force two or more unique viewpoints at a problem very quickly.  The "collisions" of ideas necessary for a breakthrough concept happen here every day...by design.  My only hope for 3M is that they protect and nurture this incredible advantage.

One other thing I'd like to mention before closing...and that is the collective brilliance in the room yesterday.  We had executive level people, corporate scientists resplendent with PhD's and 3M Hall of Fame Awards along with brilliant minds on innovation from some of the finest universities, think tanks and consultancies that specialize in innovation.  It would have been easy to be intimidated.  But it was the most relaxed, open, honest and collaborative meeting I have been involved with in a long time.  Thank you to those involved yesterday for a moving, thought-provoking and inspirational day.  I have a hundred new blog ideas based on what I experienced and saw yesterday...so watch for more insights in the future.

To build on this discussion, some of my counterparts have also shared their thoughts.  Please review and participate!

Jeffrey Phillips - OVO - Innovate on Purpose Blog
Michael Lippitz - Clareo Partners - Grow From Within Blog
Nick Schulz - American Enterprise Institute - The Enterprise Blog
Lisa Bodell - FutureThink
Joe Sinfield - Innosight
Mary Tripsas - Harvard Business School & NY Times Contributor

"Many of life's failures are people who did not realize how close they were to success when they gave up."  - Thomas Edison

I recently ran across an organization...a current Fortune 500 organization...that is dead.  That's right...dead.  Oh...you wouldn't know it yet.  They are still selling, still competing.  But they have been fatally wounded...they just haven't fallen over yet.  Maybe not tomorrow...maybe not even next year...but mark my words...they will eventually succumb to their mortal wound. 

Here are the symptoms that have led me to make this call:

• They make all serious strategy decisions based on any book by Jim Collins (hell...even Jim Collins would tell you he isn't the end all-be all of management strategy!)
  
  • They have a BHAG...that they can't reach legitimately so they changed the rules
  • They are on a quest to go from "Good to Great"...but they are actually going from partly average to mostly average
  • They have people "on the bus"...but in all the wrong seats doing all the wrong things using none of their passion
  • They are working hard to "preserve the core"...while looking only at numbers in the rear-view mirror
  • They realize that they are on the precipice of the "stage of decline" curve...which they are already free-falling down
• They have recently met, at an off-site, with the review of "How The Mighty Fall" as a mandatory pre-reading, to discuss 2010 strategy and to have their "only ideas to reduce cost will be considered" considered
• They have determined that they actually survived the recent horrors of the market and economy pretty well.  Only a few layoffs, and those were "voluntary" in a select few divisions of the organization. 
• Pay and bonus freezes for everyone at the Director-level down shouldn't negatively affect employee satisfaction scores because they all still had jobs.  This also should lead to low turnover after things "return to normal."
• They have an executive leadership team that is steered by a weak Board, preparing for a near-term CEO retirement, a COO pre-destined and pre-ordained to the top, and everyone else shining their armor to hopefully stay a little longer
• They have serious weaknesses in the "minor" C-level and even greater weakness at the VP level
• They are in a heavily regulated industry and let that fact drive too many of their decisions, serve as an excuse for not innovating and stimulate bloated projects that meet the regulatory deadline...but little else
• They have decided that their 2010 strategy is as follows:
  • Stick to the knitting...it got them through the disaster...and the disaster may not be over
  • Cut cost...no matter the cost
  • Do more with less...again
  • Pull back on new offerings...that will probably just confuse the customer anyway
  • Be a "fast follower"...although they can't do anything fast
  • Focus on the "cost of quality"...although they cannot consistently measure or define what that really means
  • Pursue "best practices" and "operational excellence"...sigh

Time of death...5:34pm...November 8th, 2009.

When they actually fall over, slide into the body bag, have the funeral and the burial...only time will tell.

I was recently given a copy of "Innovation Passport - The IBM First-of-a-Kind (FOAK) Journey from Research to Reality" by Mary Jo Frederich and Peter Andrews, and I realized the depth of my innovation "geekness" when I flew through it in one sitting!  Let's be honest here, this is a book written by innovation practitioners for innovation practitioners.  Normal buyers of fluff management books will not get past page 20 of this book.  This is serious "nuts and bolts" innovation management, product management and portfolio management all wrapped up into one book.  And that's a GOOD thing!

A lot of books written lately about innovation and product management tend to focus on the basics of culture, climate, process, etc.  Innovation Passport, includes those things as well, but goes much, much further.  It is a peek inside the research culture of IBM.  It is a primer on collaborative innovation with your clients.  It is a process manual of setting up (and maintaining) a solid innovation management and product management program.  It is a handbook on how to commercialize ideas...the real definition of innovation.

A couple of really nice features in the book include frequent "Lessons" sprinkled throughout each chapter which zero in on key points to remember on the specific topic.  I found myself turning page corners where these lessons were called out.  Secondly, the book walks through IBM's process set in a chronological fashion as it unfolds along the FOAK roadmap.  For example, in the "front end" it describes how ideas take shape, how to create solid partnerships and how to choose the best projects.  Once the FOAK is established, the "back end" pieces are further explored.  These include, clarifying project plans, ensuring the work gets done and portfolio management.  It even includes a step-by-step guide on establishing a Innovation Program for your own organization.

As an Innovation Management and Product Management practitioner, this book was very enjoyable and enlightening to read.  It is a very technical book...full of product development jargon, project management discipline and idea/innovation management process.  However, that is what really separates this book from many others, it is written at the practitioner level.  For those of you who follow along on this blog, and who are also at the practitioner level, I'd recommend a copy.  If anything, it is a rare peek inside a world-class organization that demonstrates excellence in collaborative innovation.

For more information, the authors have set up a blog at:  http://innovationpassport.blogspot.com/

"If your only tool is a hammer, you tend to see every problem as a nail" - Abraham Maslow

When I work with clients, I tend to use a lot of tools.  I have tools to assess innovation maturity.  I have tools to lead a root cause analysis.  I have tools to do customer interviews.  I have tools to facilitate an idea generation session.  You get it...I have a lot of tools.  And that is to specifically avoid the situation that Mr. Maslow describes above. 

Many times...my counterparts on the Lean/SixSig side rely far too heavily on their specific tools.  They won't even consider some the "softer" and qualitative tools used on the CPS/Innovation side of the tracks.  Honestly, I use a broad spectrum of tools from an even broader spectrum of thought disciplines.  I'll even use a tool for an unintended purpose!  GASP!

A couple of years ago I pulled together a slide deck that walked through the tools I use for problem solving that include the best-in-breed from the CPS arena and from the SixSig/Lean arena.  Hope these help!


Remember...use the right tool for the job...regardless of where it came from or whether or not it is "approved" for this particular use.

"Success is neither mysterious or magical.  Success is the natural consequence of consistently applying the basic fundamentals." - Jim Rohn

I am constantly asked the same question..."What do I need to make innovation happen in my organization?"

And that's usually followed by..."And I really just want to know the basics...the key points."

If you know me...you'll know that I cringe at this question.  There are hundreds, if not thousands, of unique combinations of skill sets, processes, tools, techniques and leadership styles that take a little luck and some money and other resources to get innovation to "happen" in any organization.

But, I'd be a pretty poor consultant and thought-leader if I didn't at least have a quick answer.  So...here is the absolute bare minimum of what you need to have innovation succeed in your organization: 

1. At least one senior leader willing to be engaged (more than engaged...participatory)
2. Resources – people, money, time and space
3. Treat innovation as a business discipline, not as an event
4. A process/mechanism for moving ideas forward (do SOMETHING with the ideas you get)

If you start with this foundation, you're already well on your way to success!

This week I am in Anaheim, California…Disneyland to be more exact.  I am attending the 33^rd Annual International Conference of the Product Development & Management Association.  As an official Media Partner for the conference, one of my responsibilities is to report and share with you the latest from the world of innovation, design, product development and product management. 

 

Let’s be clear…there are some heavy hitters here this week.  People like Guy Kawasaki and Professor Jean-Phillipe Deschamps and Ken James of GlaxoSmithKline and Steve Rendle of North Face and Dr. Sumantran of Hinduja Automotive.  And that's just the keynoters!  The conference has a full slate of corporate, academic and consulting-based experts in product development, design and innovation.  But that's still not it!  Add in Guru Roundtables where you can learn and ask questions in a more intimate setting, the Technology Showcase of new products and an entire exhibit hall full of NPD-related exhibitors.

 

I’ll be providing more frequent updates during each day at Twitter account @PDMAConference if you’d like to follow along in "real time."  Blog updates will be more summary in nature and published at the end of each day.