Monday, June 29, 2009

Innovating outside the lines

This is going to be one of those posts where I try to take a trite concept, like coloring inside the lines, and turn it into something more insight. Stick with me, we'll see how it goes.

As long as people have created art, there have been critics. One can imagine the first caveman to sketch a buffalo or mastodon probably had a critic standing just behind him, commenting on his work. I was thinking about this recently after watching a "Monk" episode. Perhaps you've seen Monk on television - played by Tony Shaloub, the detective is obsessive-compulsive, and that's just on his good days. Monk volunteers to watch the kids of his friend and colleague, Captain Stottlemeyer. He takes the kids to their favorite restaurant, a 50s themed diner, where they start coloring the menus. It drives Monk crazy that the kids won't color within the lines.

That got me thinking - everything we do in school and in business encourages people to stay "within the lines". In art we encourage people to "stay within the lines" of conventional art expectations. In science we encourage people to stay within the lines of received wisdom - after all, it was a "known fact" that the sun revolved around the earth for thousands of years. Think we are above that now?

In business we encourage people to "stay within the lines" by carefully defining their job descriptions. People who work outside of their descriptions and responsibilities are quickly reminded of their responsibilities. We encourage people to "stay within the lines" by developing specific evaluation criteria. We communicate effectively what we want from people, and reinforce that by what we provide in the way of compensation and rewards. We encourage people to stay within the lines through the power of formal and informal corporate culture, which is constantly pushing people to remain within the fold, within the expectations of the organization.

Then, we wonder why we can't innovate, why no one will - wait for it - "THINK OUTSIDE THE BOX". Hmmm. Perhaps it's because we've been constantly told that coloring outside the lines, working outside our job grade or job description, questioning the status quo, is wrong. We've become the trained elephant, which only requires a cuff to be placed on its leg to believe it is staked to the ground. If everything in your culture reinforces thinking "inside the box" and coloring "inside the lines" then why is your team surprised to find that innovation can be difficult?

What to do? Well, there are several responses to this, none of them easy. One that is often attempted and never seems to work well is to hire a couple of "left brained" people and scatter them throughout the organization, hoping they'll influence the thinking. Most of these people will be co-opted into the group think very quickly or ejected like a virus as quickly as possible. Another response is to demand innovation and change from a group that has been educated by the firm over time that change is difficult and new ideas are risky. A quick, rapid change in this environment is exceptionally difficult. The third, and most permanent change, is a consistent change from the top down, starting with strategic direction and working its way from the management team and its priorities into business plans and individual evaluations. This change may take two or three years, but the subtle shifts will encourage the entire team to get on board.

Why do we think people can immediately and effectively "think outside the box" when for their entire lives we've reinforced "coloring inside the lines"?
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posted by Jeffrey Phillips at 5:23 AM 32 comments

Thursday, June 25, 2009

Operational Excellence - once an enemy, now a friend to innovation?

OK I admit it. I've grown frustrated by the fact that a capability or insight that proves valuable to an organization - operational excellence - is also such a big impediment to innovation. It's strange that something that in some regards is so good for an organization can also be so detrimental as well.

How, you might ask, is a focus on operational excellence a detriment to innovation? Well, individuals measured on operational excellence want consistency, a clearly defined process that people follow closely, the elimination of failures and mistakes, the elimination of variance. These are GOOD things for an organization once it has determined the appropriate mix of products and services customers want. To be able to deliver the products and services at the highest quality and lowest cost is valuable.

However, all that focus on eliminating waste and variation and risk creates mental barriers for innovation that are very difficult to overcome. If a person or team has been evaluated and compensated for making the machine run efficiently and effectively, can they really stop in mid-stream and now work in a very different model - the model that innovation requires?

So, for years operational excellence has been my nemesis. But I've decided to use innovative thinking to turn the problem on its head. Perhaps what we should be asking is how to create an operationally excellent innovation process.

Those of you who follow this blog understand that firms that are successful at innovating have intentional innovation processes that are sustainable over time. It makes sense that if we want people in an organization to accomplish a complex set of tasks, we'd implement a defined process and method within which they can work. This is where the worm turns - if innovation is a defined process, then perhaps our friends who are interested in operational excellence can help us make those processes more effective and efficient.

Imagine changing the mindset of the organization - changing the cultural attitudes of the organization - by reinforcing the "operational excellence" concepts within a innovation oriented mindset. Let's find the best new ideas, and implement them in the best way possible. Suddenly these two concepts, which have been inimical, can now work in support of each other. This attitudinal change is not a simple one, but it is one that could happen. What's required is leadership from the senior executives to explain why innovation is so important, and how the concepts and methods of operational excellence can enable and support the organization to become more innovative.

It's at least worth a try.
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posted by Jeffrey Phillips at 6:50 AM 3 comments

Friday, June 19, 2009

Innocentive paints a bright future

I had a chance recently to talk with Dwayne Spradlin, CEO of Innocentive, about the growth of Innocentive over the last few years and its strategic goals. I've had the chance to interact with people from Innocentive over the years and have followed it as another example of innovation creating a solution to a thorny problem - how can we get smart minds from across the world to present us with solutions to clearly defined problems.

Innocentive has grown and changed as a firm since I had the opportunity to interact with them, and Spradlin paints a very clear future and some specific goals. In fact, we talked about four changes that he and his team have implemented, and that bear watching over time. The first is that Innocentive, which originated in the pharmaceutical space, is really branching out - targeting "challenges" in many different industries and many different scientific categories. From its original roots it initially focused on very difficult scientific challenges, but is gradually opening up to other industries and other types of challenges. Second, the kinds of challenges and types of "solutions" Innocentive can capture have expanded. The bread and butter work for Innocentive remains the scientific challenge and solution, usually a very specific, well scoped problem that has a scientific solution, but increasingly Innocentive is offering brainstorming challenges (on the more general level) and electronic RFPs (on the more specific level) which allows Innocentive to offer a full range of idea generation and solution identifying services.

Third, and one I found interesting, is Innocentive is offering solutions to firms outside the commercial sector. Spradlin and I discussed a very successful relationship Innocentive has with the Rockefeller Foundation, where non-profits can seek funding and Innocentive sponsors challenges on their behalf. Spradlin and his team believe that non-profits, NGOs and other organizations should benefit from the power of organized innovation. Finally, Spradlin and I talked about "customer driven innovation" - the cultural shifts in most organizations that happen when firms realize there are more good ideas, and more perspectives, and more insights, outside the organization than inside the organization. Putting the customer first, clearly understanding their needs, and building products and services that meet their needs is the ultimate goal - customer driven innovation.

We spent some time, as you might imagine, talking about crowdsourcing and the role Innocentive plays in the crowdsourcing arena. There are a number of easily recognizable players in the space, including solutions like Dell's IdeaStorm or IBM's Idea Jams. Innocentive participates in this market and supports the concept of open innovation and crowd sourcing, but departs from the crowdsourcing mentality when it comes to evaluation of the ideas. Rather than a "thumbs up" or ranking/voting mechanism, the solutions presented to Innocentive are not judged by the crowds (Wisdom of Crowds) but by a select team within the organization that sponsored the challenge. Given the nature of the challenges and the specific requirements of the problem, as well as the sensitive nature of the solution and its intellectual property, this is probably the best solution.

Finally we talked about the growth of innovation software and idea management. As the market matures, it's not unusual that a firm may have one, two or even three different applications - one for pure ideation, one for idea management and one for crowdsourcing or other activities. Spradlin is interested in working with other idea management firms to create open APIs or markup language so that firms that have more than one idea management application could exchange information more freely. There's an acknowledgement of history in this discussion. Both the ERP and CRM behemoths like SAP grew by aggregating various capabilities into one monolithic umbrella - perhaps there's the option to keep smaller, more nimble firms and integrate and exchange information rather than create a fully integrated idea management solution for the enterprise. Time will tell.

I came away very impressed with Spradlin's vision for crowdsourcing and for Innocentive. One has to believe that the existing economy will force firms to find the best ideas, as always, but using methods and mechanisms that control costs and speed identification of the best solutions. I think Innocentive is well positioned to capitalize on the need for innovation and the growth of acceptance of open innovation and crowdsourcing.
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posted by Jeffrey Phillips at 5:00 AM 7 comments

Wednesday, June 17, 2009

Can you afford to innovate?

Today we'll look at the affordability question of innovation from a contrary viewpoint. Usually people in my position sit hectoring business leaders about the fact that they "can't afford to not to innovate" which as we all know is poor grammar, a double negative and a lecture, all rolled into one. While saying this may make me feel righteous, and while I am probably correct, it behooves us to turn the tables around and ask ourselves - if we decide that innovation is important in our business, can we afford to do it?

Innovation has several costs associated with it as a practice. The first and most recognizable cost is financial - that is, the dollars that have to be spent in order to create new products and services. These dollars may be spent on consultants or third parties (feel free to ring us up for this kind of help) or on providing internal people and resources to an innovation team. Let's not kid ourselves. Innovation costs money - it is a form of experimentation, market research and investment.

The second cost is psychological and cultural. Can we enforce the change in thinking that is necessary to encourage the organization to think differently? This cost is actually more expensive than the fiscal cost. As a senior leader, you will need to invest your time and energy into ensuring that the cultural roadblocks and inhibitors are cleared out of the way so the innovation teams can function. It is a drain on your time and places stress on the organization and its culture. In many firms successful innovation will cost the culture something as well - which is why innovation is usually done in firms that are good at innovation from the start (already baked into the culture) or that are innovating their way out of a crisis (no other choice). Given any other option, most firms will grasp at other avenues out of a crisis - cost cutting for example, before turning to innovation.

The third cost is cannibalization. If your teams do a good job innovating, they are going to identify new products and services that overlap or make redundant existing products or services. In some instances they may create ideas that make a market or product line obsolete. Look no further than the big music stores to see what iTunes and music swapping/sharing has done to Tower Records. Would Tower Records have done this to themselves? Do they wish today that they had? Too many sacred cows in an organization will mean the cost is too high to consider innovation as a strategic tool.

The fourth cost is time. Innovation doesn't happen overnight. Well, idea generation may happen overnight, but validating an idea and bringing it to market certainly doesn't. Firms that demonstrate good innovation skills are constantly innovating, so there's not the concept of a "beginning" and "end" to innovation - it happens all the time, over time. We need a lot of time to be successful, and that time gets pulled from management, line workers and third parties. If your time is too valuable to share with an innovation team, then the innovation team ranks too low on your priorities.

So, if you look at this less than exhaustive list of cost elements, it's reasonable to ask yourself "Can we afford to innovate?". Innovation comes with exceptional benefits, but they are down the road, out a year or more, when the market is demanding return RIGHT NOW. Those returns are probable, and possibly big, but the costs are real and happening now. So the tradeoff is obvious. Many firms will argue that the possible payoffs are not worth the price in the short run, and will reach a reasonable conclusion that they can't afford to innovate. In the long run we have a name for these firms - market laggards. They have bought into the fallacy that innovation cannot "pay for itself" when strangely enough, all of the market leaders - J&J, P&G, Intel, Apple, Google, Boeing, Toyota, etc - are innovators and have found the investments necessary to innovate.

Can you afford to innovate? Of course you can. The real question is - do you have the "will" to innovate?
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posted by Jeffrey Phillips at 7:55 AM 2 comments

Tuesday, June 16, 2009

Banks - Utilities or Innovators?

Whenever I run short of ideas or just need a different perspective, I check in on several blogs that I think are real leaders in their spaces. One I find that has great ideas and content is BankerVision, by James Gardner. He writes recently about a topic that I've been thinking about for some time, the choices firms make about innovation and their role in their markets.

I think too many firms assume their markets are zero sum games - that is, there are a fixed number of customers available in a market, and any I add must come from another firm in the industry. There isn't a lot of allowance for potential customers that are currently in the margins, or customers in adjacent spaces, or in many cases people who want to be customers but can't be. The banking industry is a great example - we know for certain that at least 20% of the US population is underbanked or unbanked - those are customers that most banks know exist but either overlook or have decided that those customers are too risky or unprofitable to exploit. So billions of dollars flow in a gray economy or in remittances or check cashing sites, while the banks continue to ignore or overlook these potential customers. Yet they will fight tooth and nail for their existing customers and the customers of their competitors, taking share and losing share from each other.

All the while other firms - Prosper, Mint, alternative payment networks - are angling in and slicing away customers by appealing to one or two significant needs, rather than a general banking product. So, the banks overlook some potential customers and allow themselves to be cut off from other single need customers. Does this sound familiar? If we were to go back to the 70s and substitute the names GM and Ford for the existing banks, and Toyota and Honda for the smaller disrupters, would that seem logical? Toyota and Honda sold to people who couldn't afford or were turned off by the "Big Three", and for the most part the Big Three had turned their backs on these customers. The Big Three ignored emerging customer segments in the US and fought over the same pool of customers.

So, to return to the title and concept of this post - is your market truly a "zero" sum game? And if so, should you become a "utility" that locks in its market and provides a good or service in the background - but does it so well there's little need or opportunity to change, or should you become an innovator?

Utilities succeed for the most part because they face little direct competition. Most individuals don't have many choices for their water or electricity service. Many banks are similar to monopolies, since once a banking relationship is established, it is difficult to break that relationship and switch, especially as the number of services or products acquired by an individual from a specific bank grows. However, utilities, at least the good ones, provide exceptional service. They keep the lights on 99.99% of the time, or constantly provide clean water, so they meet or beat expectations, and consumers don't have much choice anyway.

In the banking sector, there used to be much less choice, and much less switching. However, there are many banking options and choices available, and more will come on line. As new services are developed that allow people to painlessly switch their banking services from one provider to another, the winner in the space will be the firms that either aggregate services from many banks (Mint for example) or those that create interesting, innovative products that retain existing customers and attract new ones (sorry, no examples yet).

Banks could be utilities - they could provide so many of the services and features we need as consumers that there'd be no reason to switch or seek banking services elsewhere, but they've failed in their basic mission to establish trust and transparency. Imagine if their rates and fees were regulated like utilities - then again, that might happen.

If a bank can't successfully compete over time as a utility, then it must become an innovator, or watch its best customers get sliced away by firms that offer compelling services tailored to their needs, which are then aggregated into one view by firms like Mint.
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posted by Jeffrey Phillips at 1:32 PM 3 comments

Wednesday, June 10, 2009

Promises Kept - Why Innovation works

I read the recent article in Business Week - The Failed Promise of Innovation - with a measure of expectation and regret. Here's a magazine that has as one of its leading lights Bruce Nussbaum, who is constantly writing about innovation and hosting innovation panels and events, yet either honestly believes that innovation has "failed" to meet its promises or is simply waving the flag at the bull. Of course Nussbaum wrote that innovation was "dead" at the end of 2008.

The article which suggests that innovation has failed leads in with the following paragraph:

But there's growing evidence that the innovation shortfall of the past decade is not only real but may also have contributed to today's financial crisis. Think back to 1998, the early days of the dot-com bubble. At the time, the news was filled with reports of startling breakthroughs in science and medicine, from new cancer treatments and gene therapies that promised to cure intractable diseases to high-speed satellite Internet, cars powered by fuel cells, micromachines on chips, and even cloning. These technologies seemed to be commercializing at "Internet speed," creating companies and drawing in enormous investments from profit-seeking venture capitalists—and ordinarily cautious corporate giants. Federal Reserve Chairman Alan Greenspan summed it up in a 2000 speech: "We appear to be in the midst of a period of rapid innovation that is bringing with it substantial and lasting benefits to our economy."


If you read the above carefully you'll see that innovation has failed in the eyes of this author because, for all intents and purposes, we don't have the jet backpack that we were promised. If we were promised a gadget or gizmo by the folks in Disney's Tomorrowland that we don't yet have, well, innovation has failed.

Perhaps a more enlightened and reasonable argument is that innovation happened, just not where we expected it. A tremendous amount of innovation happened in financial services - some of it bad, yes, but some of it will prove out to be great. Let's look at Prosper or other micro-lending sites for example. A tremendous amount of innovation happened in personal communications - the iPhone and other cell phones are merging the telephonic needs with computing needs and other needs.

Let's look back at that quote again and consider it from a different angle. Why don't we have cars that run on fuel cells? Well, we can, it's just that the conditions haven't matured for fuel cells to be the dominant mode of propulsion. Gasoline and diesel engines, along with hybrids are still more efficient than fuel cells. An innovation or great idea holds promise, but it must succeed in the marketplace. Fuel cells hold great hope, and will become a significant source of propulsion when gasoline remains above four dollars a gallon or when Congress decides to mandate their use. Does this mean that innovation "failed"? No, just that some of these concepts identified above were talked about years ahead of their time. Micromachines and MEMS provide another great example.

Many projectors that we use every day or televisions we have at home are powered by a MEMs device - the Digital Light Processor from Texas Instruments. There are MEMs devices out in the world today, we are just beginning to see them enter the market. While the idea was great, developing the manufacturing capability to produce them took - wait for it - innovation in manufacturing techniques. Just because we can envision a MEMs device doesn't mean that we had the capability to produce them with very low error rates at volume.

Innovation isn't dead, and it hasn't failed to meet unreasonable expectations or promises. Instead of creating these false peaks and unrealistic expectations about innovation, perhaps we should simply create the environment where innovation can thrive and get out of the way. Some of the biggest impediments to innovation aren't technological or even monetary, they are cultural and bureaucratic. The next article written about this will certainly suggest that since innovation has "failed" in the private sector, perhaps the Federal Government should create specific programs to "manage" and fund innovation in specific segments, which will lead us directly to where Japan was in the 1980s with MITI, a failed corporatist policy.

Innovation is supposed to fail, frequently and with consequences. Taking risks means that some of the ideas HAVE to fail for others to succeed. Edison didn't create the best, most effective lightbulb on his first try - he failed repeatedly and what we see today is only the success based on a tremendous number of attempts.

If we look carefully, innovation has happened all around us, and we'd be foolish to suggest that innovation has "failed". If it didn't happen in the markets we'd hoped, or in the timeframes we'd hoped, then perhaps the market demand guided innovation to happen in the places where consumers demanded it most.
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posted by Jeffrey Phillips at 5:14 AM 20 comments

Tuesday, June 09, 2009

Pulp Innovation - Continued...

If you've enjoyed Pulp Innovation, then please continue to follow it at http://pulpinnovation.blogspot.com. I will continue the saga of Sam Marlowe and the innovation consulting team at Marlowe Innovation at that site, since I want to turn my attention back to current events in the innovation space in this blog site.

As always, please feel free to contact me with your thoughts or suggestions at:
info (at) ovoinnovation (dot) com.
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posted by Jeffrey Phillips at 5:32 AM 2 comments

Monday, June 08, 2009

Pulp Innovation Chapter Twenty Five

With Meredith coming aboard, Matt and I decided to ensure we had documented our methods and processes, to make it easier for Meredith to come up to speed on the products and services we delivered to our clients. That meant that we had to get a lot of our concepts on paper, rather than simply retaining them in our heads. Additionally, we agreed to train Meredith in our approach, so that she would be able to participate on projects that weren't related to market research or ethnography, and hopefully she'd learn enough that she could take on a leadership role on our projects.

Take two dyed in the wool consultants, numerous innovation projects over the years with at least 30 different clients and try to distill that down to an organized methodology, so you can teach a new partner the "ropes". Talk about drinking from the firehose. Matt and I debated, and wrote, and condensed, and debated some more. At the end of the week we'd developed an outline for a five day training session, which we felt would serve as a great introduction to many of the phases of an innovation project, and give Meredith a chance to understand the sweep of the work she'd be involved in.

The first day was focused on innovation and corporate strategy. This is an area that is often overlooked, in our experience. The CEO or some "C" level executive proclaims the need for innovation, and a couple of teams scurry around creating some new item or gizmo, only to discover that the new creation doesn't align to corporate needs or expectations. No, we firmly believe that successful innovation requires a good understanding of the corporate goals and directions, and we advocate thinking about innovation as an enabler to corporate strategies, rather than a strategy unto itself. There, I've used the word "enabler" in a sentence which either makes me a consultant or a psychotherapist. Sometimes it's hard to tell the difference.

The second day of training is focused around spotting opportunities. Many firms we work with have the opinion they can innovate from the "inside out" - that is, that many of their customers are simply clamoring for the great new technologies that XYZ firm has dreamed up. Unless your named after a popular fruit, that doesn't seem to hold much water in the real world. Most successful innovators need to examine trends, understand their competitors, and rub elbows with their customers to understand the needs and opportunities in the marketplace. Day two was written to consolidate trend spotting and synthesis, lead users and a number of other techniques to gain customer insight. Of course Meredith could flesh out the section on Ethnography and market research.

Matt tackled day three - which was about creativity and idea generation. In our years of consulting, we'd rarely come across a well-run ideation or brainstorming process in our clients. Too often the sessions were either poorly led or led by someone with a stake in the outcome, which biased the process and the results. Additionally, many of these so-called brainstorms turned into debating societies rather than follow the best practices for brainstorming outlined by the Creative Problem Solving Institute and others over the years. So Day Three was focused on idea generation, with a heavy emphasis on managing an effective brainstorm, but with a look at a number of other idea generation techniques. Matt excelled at this, so he worked up a great program for Day three.

Day Four was my specialty. Once we've identified opportunities and needs (Day Two) and generated ideas to satisfy those needs (Day Three), how does a team turn a raw idea into a new product or service? In Day Four we examined the needs for a consistent innovation process and the roles and responsibilities that exist within that process. My favorite analogy: suppose I want to create a new purchase order. Certainly I'd speak with a person in purchasing who'd have a binder with all the necessary processes, and a purchasing system would be in place to help me place my order. All of the steps would be documented and everyone would have clearly defined roles and responsibilities. What about generating and documenting ideas? Does any process exist? Is it defined? Do the people who need to be involved to flesh out ideas and evaluate them understand their roles? Who are we kidding? While there is no one required innovation process, every firm that succeeds at innovation has a process that they follow.

The fifth day examined innovation leadership, especially focused on changing the culture of the organization and identifying traits of successful innovation leaders. Matt and I based this day on the team leads that we'd found who were successful in our clients, and used case studies to identify why some firms had been less than successful. Imagine telling your employees to be innovative - to take big risks and change the organization - but holding them accountable to the same evaluation and compensation processes that existed before the introduction of an innovation program. Of course everyone reverts to what they are evaluated and compensated on, which isn't innovation, so little to nothing gets done. Without significant culture change, innovation is tough to do even with great idea generation, opportunity identification and an innovation process.

After a week of development, debate and self-reflection, Matt and I were pretty pleased with the results. What we had, in fact, was a curriculum not only for Meredith but one we could offer our clients as well. We both were comfortable leading groups, and had a tremendous range of innovation experiences to draw from to ensure the training wasn't simply an academic exercise. Meredith's acceptance was paying dividends even before she showed up for her first day of work.
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posted by Jeffrey Phillips at 5:46 AM 4 comments

Friday, June 05, 2009

Pulp Innovation Chapter Twenty Four

We finished our lunch with Meredith and thanked her for her time. After the usual pleasantries that are exchanged when people you barely know are departing, she did something I admired.

"Well, how'd I do?" she asked.

Matt's eyes widened and I laughed. A direct question deserves a direct answer I thought.

"Personally, I think you've got good experience and good insights."

"But.."

"But Matt and I need to talk about the impact of a third partner, and whether or not we believe you could work the way we work. Leaving a safe corporate nest for the world of consulting is a big change. We at Marlowe can be a bit rough around the edges and we have big expectations of each other, and the folks we work with."

"How can I prove to you that I can contribute and want to work as part of your team?"

I knew I liked her. It was a good question. How can you prove yourself if you aren't given a chance to do so?

"Tell you what" I said. "Can you arrange to take a vacation from your job and join us on a job as a spectator? Then you can see for yourself how we work and what our expectations would be of you. At the end of that, if you are comfortable with us, and we with you, we'd offer you the position." I glanced at Matt for this last bit, checking to see if he was on board. The slight tilt of his head assured me he was.

"I'm interested and I'd be willing to do that. How soon can we make it happen?"

"I'll be in contact with you in two or three days. We'd need to identify the right client. As soon as I think we've got the right opportunity, we'll let you know. If you haven't heard from me by next Friday, give me a call."

"Thanks, Mr. Marlowe. I'm very interested in working with your firm. I don't want to seem pushy but I'd like to arrive at a decision quickly."

"I understand, and I appreciate your directness. As I said, I will find an opportunity for you to come in and work with us, and we can take the decision from there."

I turned to go to Matt's car. Matt caught me and walked stride for stride down the sidewalk. "What project can we bring her into that will give her the sense of what we do?"

"I don't know which would be best, but I like her style and we can use her skills in several clients we have currently. Do you have any reservations about her?"

"Same as yours. It can be tough to make the jump from corporate life to the life of a consultant. She's got good presence and clearly understands market research and ethnography."

"So are you saying we should just make the offer now?"

"Yes, I am." That pulled me up short. Matt had walked on several paces before he realized I had stopped.

"You were dragging your feet on this just a few days ago. Did she do so well over lunch that she changed your mind?"

"Look, number one, she's got the skills. Two, she's even better in person than on the phone. Three, we tell our clients to be decisive and make the decisions that are evident. Why shouldn't we take our own advice?"

What can you say when the evidence falls out in such a compelling way? I shrugged and nodded. We continued on to the car.

That afternoon I called Meredith and offered her the job, if she wanted it, without any other conditions. After some negotiation over salary and start date, she accepted. Now, Marlowe Innovation had two senior partners and one junior partner, and the capability to deliver an entirely new set of insights to its customers.
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posted by Jeffrey Phillips at 5:02 AM 1 comments

Tuesday, June 02, 2009

Pulp Innovation Chapter Twenty Three

After my call with Johansen I took my sales frustration out on the piles of work I had on my desk. I was able to plow through several weeks worth of messages, followups and introductory calls by the time lunch rolled around. Matt and I had planned a lunch to meet with a candidate to join our practice, an experienced ethnographer and market research consultant who was looking to join an innovation firm. Both Matt and I felt that her skills could effectively round out our team. Matt was the idea generation guy and did a lot of work on culture and communication. I led a lot of trend spotting and synthesis work, and also focused on building innovation processes and methods. Together we both offered training. What we were missing, however, was the capability to help a firm identify customer and prospect wants and needs, especially from a qualitative viewpoint. Meredith could fill Marlow Innovation's most obvious hole.

Her background and skills were impeccable. She had graduated only a few years before, from one of the few universities that granted an ethnography degree, since that branch of study had only recently split from the more traditional anthropology degree. After graduation she had worked for a mid-sized bank, but given the turmoil in the banking industry and the slow pace of change in that industry as a whole, she was looking for something more interesting and with more change. I had my concerns.

Moving from a safe, traditional nine to five in the banking space, to a consulting role in the innovation space was a big leap. In addition, Matt and I worked as hunters - we found the work, won the work and as a team we completed the projects we could staff internally, and sourced partners when we needed them. Both Matt and I had sales responsibility, and anyone coming aboard would need to pull their weight in the sales cycle. Would Meredith be able to make the transition from a relatively stable role in a slow moving industry to a consulting role that demanded quick thinking and learning new industries, while taking on sales responsibility and project leadership? It was a steep hill to climb.

I had liked Meredith from the start if for no other reason than that she had contacted us for the interview. I liked that get up and go attitude, and she seemed interesting and engaging on the phone when we first spoke. I'd let Matt talk with her as well before we brought her in to meet in person, to ensure I had his buy in and support. Matt gave her the thumbs up so we planned to meet at Darby's on Lancaster street - a neutral site that allowed us, and her, to back away if the first face to face didn't go well.

Darby's is one of those places that seems to exist only to satisfy my eating requirements. It has a chalkboard full of daily sandwich specials that only Dagwood could truly appreciate. Most of the sandwiches are stacked high with meats, cheeses and vegetables, and make for difficult eating even with good friends. I suppose I should have suggested a place where the food was easier to consume while talking, but Darby's it was. We arrived and took our regular booth near the back and waited for Meredith to arrive.

"You sure we can afford another person on the team?" Matt asked. We'd been through this before - we had a good pipeline of work for us and a few others, but bringing another senior person on board meant more sales efforts for both of us. However, I thought we could recoup the costs by taking on the work we'd been sourcing to other ethnography and research firms.

"I think we can get more work from our existing customers and take on larger projects with Meredith, and we won't need to outsource so much research work" I said. "No guarantees, but I think her skill set is something we need. You getting cold feet?"

"Cold, no. Cool, possibly. It means a lot of work to bring someone aboard, and it would be a big change for her as well."

"She's probably not the hard bitten type yet, you mean. Used to the 9 to 5 routine. Can she come up to speed quickly on a new industry, and add value quickly?"

"Yeah. It's an issue. Plus we have this charming rouge image to uphold. Is that possible if we add a younger woman to our mix?"

We were about to find out, as Meredith approached our table. She was younger than Matt and me, not that that mattered, tall and thin, with a slightly pinched face. She'd be more attractive if she smiled, I thought to myself. She looked a bit bookish and shy, unlike what I expected from our call.

"Mr. Marlow" she asked.

"I'm Marlow" I said, scooting around in the booth and taking her hand. "And this is Matt Ferguson, my partner. You spoke with him last week."

"Pleased to meet both of you" she said, but didn't look pleased. She clasped a portfolio close to her chest, as if she might need to ward off our possibly unseemly advances.

"Please join us. Can we get you something to drink?"

"Yes" she said. "Is it close enough to lunch to order a bourbon?"

I knew I had liked her on the phone.

It turned out that Meredith was very nervous, and after meeting a couple of guys like Matt and I you could understand why. After her drink, and a brief introduction from me on the firm and how we operated, she seemed to become much more comfortable.

"I've been working for Coastal Bank for over five years" she said "doing primary research, quantitative mostly, and some voice of the customer work. I've not had a chance to do as much ethnography as I had hoped, but I have participated in the development and launch of two new products. The work is interesting but slow, given the culture. The bank doesn't want a lot of risk, so we carefully plan our new products and I think we often miss opportunities. I'd like to do more primary research and ethnography, and I think a consulting firm focused on innovation would be the right place for me."

"What do you think ethnography and market research can add to an innovation project?" Matt was opening the door. Meredith would make or break her opportunity with us with this answer.

"Most market research tells us what customers like, or don't like, about what we already offer. Ethnography can give us insights into what people do, and why they do it, and offer a glimpse into needs that they have we can fill. Rather than talk about what they don't have, or don't even know they need, we may be able to spot opportunities they haven't recognized, or needs they have they aren't aware of yet."

I met Matt's eyes and he nodded slightly. Meredith had the right insights. Now, could she work the way we worked?
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posted by Jeffrey Phillips at 6:28 AM 2 comments

Monday, June 01, 2009

Pulp Innovation Chapter Twenty Two

I was back in my office, bright and early the following Monday. Well, 9:30 is early for me and it was bright outside anyway, a sunny, clear day that promised the start of a great week. On my desk there was the flotsam and jetsam of a person in and out of the office constantly, working on a range of different projects, each of which had their own timing and progress. A dozen pink slips were there, requesting and in some cases demanding a return phone call. I knew it would be a busy morning.

Matt had also decided to grace us with his presence that morning. His desk, unlike mine, was spotless and completely organized. How he managed to do it was beyond me. Like a duck I supposed, calm above the surface but paddling like hell below it.

I started my day with the usual, a steaming cup of coffee and an unfiltered Camel. Matt and I had been together as a team long enough that we had the old couple ritual down.

"Morning" he said, without even a second glance. "Breakfast of champions I see."

"Breakfast of Champions is a Vonnegut novel. Turns out that caffeine stimulates the brain - so coffee is a brain food."

"And cigarettes?"

"They simply have the ability to repel people who would otherwise require me to eat a bran muffin every day."

"So you are a defensive smoker?"

"You could think of it that way."

Given our heads, we could carry on a patter like this just like Bacall and Bogart. We'd learned not to carry it too far - no whistling references, but on any given day it was a one-upmanship game to see who'd give in first. Today, I was too enthusiastic and too busy to carry on. So Matt stepped on my toes for me.

"What's up with Accipiter?"

That's what I wanted to know. Four days after our meeting and not a word from anyone. Usually silence meant you'd shot and missed. Fine, if I missed, no problem. Just let me know I missed and what you were expecting. Any meeting is a learning experience for me, just as much as for my prospects. I had already resolved to ring Phillips and possibly Johansen to see what the word was in the informal network.

"I thought the presentation went well" I said. "No word yet from them. You know how it is."

"Yep, I know how it is."

Matt did know how it is. He had a set of his own clients and knew the sales score. Talk to ten, get engaged with three or four, hope to close one or two. And never hear a word more than absolutely necessary from your clients. I suppose they think we innovation consultants have extrasensory hearing along with our ultra-creative personalities. In most cases I've never experienced a sales process with less interaction, less communication and more surprises than when selling innovation services. Given what we knew, and how we could help, I was constantly surprised by the lack of engagement during the sales process. Accipiter was following the tried and true approach we'd seen from a number of our clients - a series of high profile meetings with no clear goal, interactions with a range of different people with very different and often conflicting goals and agendas and no clear outcomes.

"I'm planning to shake the tree over there later this week" I said, more to cover the fact that I wasn't sure how to shake the tree, or if there was even a tree to shake. It wasn't clear who was in charge of the initiative, and what the ultimate goal of the effort was. "I'm going back to the folks I think are champions for us and for the project, Briggs and Johansen. He's in HR and she's the nominal project manager. Neither of them are decision makers, but perhaps they can give me a read on what is happening."

"Flying a bit blind, are we?"

"Stumbling in the dark with a blindfold barefoot in a room full of broken glass."

"That bad?"

"Yes. But there are some real opportunities there if we can get a project started. We can do some great things for them, and I think they have the energy and desire to create some interesting new products and services. We've just got to overcome the inertia that builds up around things like this."

"What are you waiting for? Pick up the phone and give someone a call. Let's get that thing moving". Matt wanted the win almost as much as I did.

I pulled out a pile of crumpled business cards from my desk drawer, sorting through them looking for the joker and the ace. In this case, Johansen was the ace I thought. She doesn't make the decisions but does seem to be the fair haired child. Briggs, on the other hand, is the joker - he gets the downstream benefit of innovation but won't necessarily be involved in the project. However, he did seem to have his ear to the ground, and understand the value that an innovation initiative could bring to retention and recruiting new employees. Which one do I call first? I decided to dial Johansen. While not in the loop, at least she was in the direct line of succession.

The phone rang and was answered by a crisp, impersonal voice. "Accipter Enterprises" the voice said.

"Susan Johansen please"

"Thank you" and the voice was gone, replaced by a humming, a few clicks and the ringing sound.

"This is Susan Johansen"

"Susan, this is Sam Marlow. Is this a good time to take a minute to speak with me?

"Hello Sam. I have just a few minutes before my 10 o'clock." I glanced at my watch. Five minutes to ten. Just enough time to get the story from the inside.

"That's fine. Shouldn't take that long. I appreciate the chance to catch up with you. I am simply trying to understand what the next steps are with Accipiter. Have you heard anything coming out of our presentation and the executive team meeting last week?"

There was some paper shuffling on the other end, a slight pause and then "Not really. I heard your presentation was well received but beyond that there's not been any action on it as far as I know."

"If you don't mind me asking, this is going to be your project. What do you think will happen?"

"I've been asked to lead an innovation project by Bill Thompson, but he needs to get the executive team agreeable and on board. Your presentation was a first step toward doing that. I think Bill believes we still have to bring several of the executives on board. Several of them are uncertain about the investments and risks of innovation, and are frankly protecting their budgets."

"OK - do you know if there is a plan to get them on board?"

"I don't know yet. Bill and I are scheduled to talk on Wednesday. Can I give you a call then when I may know more?

"Of course, and thanks. I know you'll need to move on to your meeting, so I'll just plan to call you Wednesday afternoon."

"That will work for me."

"Thanks Susan"

"You're welcome."

Matt glanced at me. He didn't have to say anything. We both knew it would be a long, drawn out sales cycle.
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posted by Jeffrey Phillips at 4:53 AM 1 comments