Monday, March 01, 2010

Selling innovation to your boss

I've argued before that most firms innovate when faced one of two conditions:  fear or greed.  The fear factor indicates the firm has explored all other options, and now only the most "radical" option - innovation - remains.  To paraphrase Sherlock Holmes, "when you've eliminated the possible, whatever remains, no matter how improbable, must be the answer".  And, like Gordon Gecko from Wall Street, I believe many firms innovate when they believe they've spotted an emerging opportunity or new market.  In this case, greed is good.

But if all innovation were based on these two drivers, then little innovation would get done.  Clearly many firms latch onto innovation as a life preserver, a last ditch effort rather than a strategic focus, but there's more innovation underway than could be accounted for by desperation.  And I'm relatively certain that while some firms are good at spotting innovation opportunities and moving aggressively to produce new products and services, they are fairly few and far between.  That leaves us with the majority of innovation getting done by the firms in the hazy middle - not really desperate, but not really leading innovators either.  If that's the case, what methods do they use to "sell" innovation to the appropriate decisioning individuals or bodies?

Innovation can be "sold" to executives in one of several methods:
  1. As a method to increase organic growth, driving new profits
  2. As a method to disrupt the existing market or adjacent markets, preempting a competitor
  3. As a method to create significant differentiation within a market space
  4. As a method to create product or service leadership
These are the hard-headed, rational reasons, and the reasons that organizations tell themselves they innovate.  in reality, most firms take on innovation efforts because:

  1. An employee created a great idea and we really have no choice but to exploit it
  2. A competitor has launched a new (product, initiative, campaign) and we need to respond to it
  3. A senior leader within the firm has made it his/her mission to create an innovation program and the squeaky wheel must be greased
We often find that innovation programs are formed around existing assets - people or ideas - that persist until they must be addressed.  Sort of like a plant that must be weeded out or watered.  Otherwise, most new innovation efforts are based on a response to what a competitor is doing.  This "reactive" innovation is not, in our minds, the best way to innovate, but it may be the best way to sell an innovation program, to give your initiative the final "kickstart" needed to get the funding or resources you need.

Thus, to "sell" innovation you need to:
  1. Link it to a corporate objective (growth, differentiation, disruption) 
  2. Build ideas and momentum under the covers
  3. Demonstrate what your competitors and new market entrants are doing
  4. Link all three together (strategy, existing momentum, competitive threats) to complete the package
Without all three "legs" of the stool, you'll struggle to gain credibility.  Without a strategic linkage any innovation will be incremental point solutions.  Without some existing momentum, the work will seem too overwhelming.  Without the ability to demonstrate what competitors are doing, you rely on executives who place great emphasis on longer term strategic goals.
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posted by Jeffrey Phillips at 5:46 AM

47 Comments:

Anonymous Robert Brands said...

Right on Jeffrey, one of the main reasons great ideas fail in the management process. All part of Training & Coaching (7th Imperative of Robert's Rules of Innovation, www.robertsrulesofinnovation.com

7:16 PM  
Blogger CHARLIE GARLAND said...

Jeffrey - I have to say I have a very different perspective on this issue, and that is that innovation needs to be value- (and values-)driven, not fear- nor greed-driven. That's one of the major problems with our broader culture's conceptualization of innovation, in my opinion. That's also one of the reasons I'm writing a book on this very topic. It'll be out later this year. A bit more via shameless plug: www.businessbrainstorm.com.

3:09 AM  
Blogger Jeffrey Phillips said...

Hi Charlie.
I agree with your assessment, innovation should be value driven, but that's not often how a team gets the approval to innovate within a business. One could characterize yours as the "heart" argument and mine as the "head" argument for innovation. When it comes to resources and dollars, the heart may be right, but the head usually dictates.

5:59 AM  
Blogger Mitch Ditkoff said...

Nice post. Thanks.

5:33 AM  
Anonymous Boris Pluskowski said...

Hi Jeffrey

I think you're spot on with this post. Although I agree with Charlie that programs need to be value driven, I think you've covered that element more than adequately by making sure that people are linking their programs to corporate objectives (which incorporate a definition of what is valued by the company as well as the values by which they are willing to achieve those objectives).

All in all a great post :)

Best

Boris Pluskowski
http://www.completeinnovator.com
http://twitter.com/bpluskowski

7:55 AM  
Anonymous George Rathbun said...

You are absolutely right. However, there is one thing I'd like to add. Most organization have, or at least think they have, a department (i.e.: R&D) or subgroup in the organization that is responsible for innovation. The rest of the organization is cutoff, so someone with a great idea may not have the avenues necessary to have it explored. This really is where innovation is getting hung up... organizations are not tapping their collective brain trust. They are limiting the number of people allowed to engage the innovation process, and are oblivious to this fact because in their minds they already have a process.

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