Monday, April 16, 2007

Reactive or Proactive Innovation?

By now, certainly you know that when someone asks an either/or question, the best answer is simply "Yes". I'd like to spend a few minutes today thinking about the benefits and rationales of innovation that is reactive, and innovation that is proactive.

Most companies have opportunities for both reactive and proactive innovation, so let's start by defining terms. Reactive innovation is innovation that waits for a good idea to be presented. The classic reactive innovation technique is a suggestion box or an email address. In "reactive" innovation, the firm expects ideas to be sent in and then reacts to those it considers good ideas. Proactive innovation is an approach that constantly seeks to find great ideas and to sponsor ideas. Proactive innovation means that the firm is constantly defining new opportunities and challenges and using the ideas generated to attempt to create new products and services based on those challenges. So, which is the "right" approach?

For a firm just starting on an innovation path, we strongly suggest starting with a "proactive" approach. This means creating a few well-defined problems, challenges or opportunities and creating a brainstorm or other method to submit ideas based on these defined challenges. Creating a context for your team and directing their thinking as they begin to innovate is important. The context helps them understand what kind of ideas your firm needs, draws bright lines to help direct scope and thinking, and demonstrates how the ideas will be used - showing that they have value. Actively seeking ideas early in the process demonstrates commitment to the innovation process as well.

Once these programs are up and running, the firm has set an expectation for innovation and demonstrated how those ideas are used. At that point a suggestion box (which is more "reactive" than proactive) can make sense. A suggestion box allows individuals to report and capture ideas of any form or type, without management's direction to solve a specific challenge or opportunity. This means that in a reactive mode, ideas will vary widely and will need more time for review and contemplation. A suggestion box is best used once the firm has some experience with proactive innovation techniques, so the organization begins to understand how to generate and submit ideas.

Clearly there are other aspects of proactive versus reactive innovation. Other factors include:
  • Communication and expectation - what do we expect to happen in our firm based on the innovation approach?
  • Investment - proactive means taking action before the first idea is generated. How do we invest in these programs and how do we fund them?
  • Compensation/Motivation - it's much simpler to demonstrate that management is involved and committed to a proactive innovation approach. How do we compensate and motivate people in a "reactive" approach?
As noted above, eventually both approaches are important and can run in parallel. For those just starting out, a proactive bias is in order.
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posted by Jeffrey Phillips at 5:10 AM

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