Wednesday, January 27, 2010

The most powerful innovation tools

I was leading a training session with a client today when one of the folks in attendance looked at me and said - this isn't rocket science.  I had to agree.  In my experience most of the really interesting tools and techniques for innovation, the ones that create real insight, are fairly simple, but in their simplicity force the team to look at its products and services in a completely new light.

Take, for example, my favorite "low hanging" fruit - the scenario plan.  A scenario plan can be built by a few well trained executives in a workshop in a day or two, using trends and market information gathered over a few days or weeks.  There are several published methodologies to follow, and if you need a good facilitator to walk you through the effort, we're available.  Total effort, less than you spend fighting most "fires".  Total value - the identification of emerging opportunities and possible threats to your business, with enough lead time to act accordingly.  Why every firm, every product group doesn't conduct at least two scenario planning sessions a year is beyond me.  They are easy to do, help you gain advance insight on critical markets, and can help position your firm in a leadership position instead of a reactive situation.

Or, another favorite tool, the one that sparked the "this isn't rocket science" comment - the customer experience journey.  This tool documents the lifecycle of a customer as they become aware of your offerings, become a customer, use your products, services and support, and remain a customer or leave.  Understanding the lifecycle of the customer and critical touchpoints, we can discover "moments of truth" where the customer has different expectations of service or interaction than we do.  Simply put, we are trying to be "intentional" about our design for customer experience.  What's powerful about this tool is not in its bells and whistles.  There really aren't very many.  What's powerful is that few firms think about the "journey" and these critical interactions and design the customer experience.  There are a number of potential opportunities to innovate around a customer experience, and studies show time and time again that the two most compelling innovation types are innovations around business models and innovations to create unique customer experiences.

I'm sure that many of you seek very interesting and robust methodologies and tools to further your innovation efforts, and some of them may actually be useful.  I suspect that a good rule of thumb is that the most robust or difficult the tools is to understand and use, the less real insight and value it creates, while very simple tools - scenario planning and customer journey mapping as two examples - create value because they force you to adopt very different perspectives than are typical.  Often times the simplest tools are the most powerful and most robust.
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posted by Jeffrey Phillips at 9:11 PM 7 comments

Tuesday, January 26, 2010

Book Review: LinchPin

Every once in a while an opportunity comes along to explore something really new and different, and I'm happy to say that you're experiencing one of those events.  Seth Godin is releasing a new book entitled LinchPin, and is trying out a completely new "media" strategy relying on bloggers.  I was honored to be asked to participate.  You'll find his entire book launch on the Squidoo lens:  http://www.squidoo.com/the-Linchpin-Posts.

Seth sent out sections of his book in advance and we had a chance to read those sections and ask questions of Seth about the book.  I've also had a chance to read Linchpin and will provide a review and some of the Q&A between Seth and myself.

First, the review of LinchPin.

Seth has tapped into a number of trends over the years and LinchPin is no exception.  However, I think the concepts he elaborates in LinchPin are probably more important and more sustained than any of the trends from his previous books.  The concept behind LinchPin is that many people need to take ownership of their jobs and lives, and demonstrate the value they can offer by becoming "indispensible".  People can become indispensible not because of their power or position, but because of the way they work - what Seth calls "emotional labor", and what I like to call engagement and passion.  I think with LinchPin he's tapped the mother lode.

Too many people accept a day's pay for a day's work.  They clock in, do their work like automatons, and clock out.  Most businesses never tap the creativity or passion that people have, and most people believe that stuff belongs at home, or in the gym, the lodge, the classroom or the garage, rather than in the cubicle.  The truly indispensible people are ones who bring all that passion and energy to work, and deliver incredible experiences for their partners, customers and compatriots.  I think many people are unsatisfied at work because they aren't willing to tap into their real energy and passion, and don't believe that that work would be rewarded and valued.  In a time when everything can be outsourced, only commitment, passion, creativity and engagement will be differentiators.

This raises both an opportunity and a concern.  People who are too energetic, too committed and too engaged can be a threat to the regular business practices of most businesses.  So, the LinchPins may find themselves as outliers in their business, which can be discouraging, or they may find the culture changing to meet their leadership.  In other instances LinchPins may have to form their own businesses to be able to work they way they want to work.  A word that is frequently repeated in LinchPin is the word "unique", and there are few firms and organizational cultures that embrace uniqueness today.  While I believe Seth's on to a core need that many people have, it may be some time before larger organizations embrace the creation of more LinchPins.

Now, my Q&A:

JP:  Why "LinchPin"?
SG:  My goal in the title was to let people know that it doesn't matter if the world says they are in charge, it doesn't matter if they've been annointed - what matters is taking the steps to become something we can't live without.

JP:  Can a person become indispensible within an organization or do they have to stop complying with an organization in order to do so?
SG:  All of us have worked with people who would be awfully difficult to replace.  Not because of power, but because of their contribution.

JP:  Isn't scalability and repeatability important?  Can we be an economy of thousands and thousands of entrepreneurs?  What work will remain within a corporation and what will be outsourced?
SG:  Of course we need these jobs (cogs that exchange a day's work for a day's pay) but that doesn't mean you have to choose to do them!  My point is that we have been literally brainwashed by industry to believe these are good jobs and that we should shut up and do them.  It's just not true.

JP:  Isn't it a bit much to claim there's a "multi-generational conspiracy designed to sap your creativity"?
SG:  No, I stand by my hyperbole.  The fact is, large corporations and the engines of commerce have been aligned with the government (and vice versa) for a hundred years.  What we've done is interntionally set up a system (and it's worse in Asia) designed to produce compliance.

JP:  What, exactly, is emotional labor?
SG:  I'm using it to describe the hard work of being present, of being creative, of confronting fear, of making a personal connection with colleagues and customers.  Work used to be put cog a into widget b.  Now work is making a customer's day, in whatever way you are able to.

JP:  What's the shift from "mediocre obedience"
SG:  I think we're seeing a profound shift in the culture, particularly among educated and sucessful individuals.  Part of it is the environment, part of it is the economy and part of it is aging boomers.  The direction we're heading, I think, is that we're going to reward and respect artists, not consumers.

JP:  Why the focus on "giving"?  It seems most corporations are more focused on "taking", especially the CEOs of larger organizations.
SG:  I'm arguing that the reason we pay these guys so much is that we're afraid to stand up and do things on our own.  The resistance pushes us to be bystanders, so the board and shareholders happily give away the store to the guy with the guts to stand up and say "follow me".  We won't need great men when we embrace the fact that they're no better than us, they just figured out how to lead a tribe.

JP:  Is this book meant to encourage people to create their own destinies and follow their "art" or meant to inspire people within larger organizations to change their cultures?
SG:  Art is not painting or poetry.  Art is making a difference, leading, doing the thing no one thought of before, doing work that matters, wherever you are, whatever you do.  The resistance would like you to believe that fitting in is what's expected, safe, required by the shareholders, essential for efficiency, blah, blah.  Bullshit.  The big secret is that every organization needs multiple LinchPins.  Why not you?
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posted by Jeffrey Phillips at 4:15 AM 10 comments

Friday, January 22, 2010

Voting Against Innovation? Really?

Bruce Nussbaum is a voice I generally respect in innovation, but this time I think he's got it exactly backwards.  In his latest post he argues that the Supreme Court ruling on campaign finance law locks in all advantages to large corporations.  His position is that since large organizations have buying power in political campaigns and lobbying organizations, they can elect politicians who will do their bidding.  Thus, his reasoning goes, any new innovation or idea will be regulated or legislated out of existence by pliant politicians who are in the pockets of big commercial contributers.

How many times do we have to see this movie?  I remember Rollerball, when I was kid. We were all going to be singing the Coca-Cola national anthem.  Every ten years or so we are warned that big corporations will take over our government and will dictate to us, the consuming population, who will be powerless to resist.  This is such a nihilist view of the world I scarely know where to begin.

Let's frame this around innovation, since that's where these concepts intersect.  Nussbaum is asserting that big corporations will be able to block or eliminate innovation that threatens them if they are allowed more opportunity to fund political campaigns.  So, I guess Twitter, Facebook, MySpace and all the social media will simply disappear, and we'll all become compliant drones.  The ever increasing capability for ANYONE to complain and build social networks to others who feel the same way will only grow, so I find it hard to believe we won't be able to build coalitions to push back against any infringements of our needs.  Second, I don't recall Yahoo or better yet Microsoft even noticing Google or taking them seriously, and if they had attempted to regulate or legislate Google out of existence many people would have rebelled.  Nussbaum seems to think there are a cabal of people standing ready to tell us how to think and what to buy, and those people will be unleashed with a vengenace when the corporations can support candidates.  News flash:  corporations, large and small, have competing interests and different goals.  They don't work in lockstep or we'd have far fewer choices in our markets.  And this supposition ignores the fact that we import much of the products we use, so unless we are willing to outsource all innovation, the US firms will have to at least keep pace with foreign innovation or build walls around our economy.

I find it very difficult to believe that the campaign finance laws will impact innovation.  If large corporations in this country actually believe they can legistate or regulate their way around competitors, then they'll need to eliminate an entire generation of entrepreneurs in this country and build blockades against good ideas and products from a host of other countries.  Once we've shot our children and walled ourselves in, it won't take long to realize we've become Zimbabwe and for those people who wanted choice and new products and services to overthrow their government, hopefully at the ballot box.

I believe Nussbaum is working from an old, corporatist model in which few companies control the media and dictate what we learn and how we interact.  I think we are smart enough and connected enough that regardless of the amount of corporate financing that flows into Washington, we the people will be able to overcome any movements to limit innovation, if for no other reason than the quality of our lives depend on it.
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posted by Jeffrey Phillips at 2:05 PM 2 comments

Thursday, January 21, 2010

What good innovators know

There are a lot of smart people writing about innovation, and what it takes to succeed.  I'd like to suggest that there is one relatively simple attribute that all firms that demonstrate innovation success share, and that's constancy.  While others will argue for factors like culture, or leadership, or vision, or tools, I'll tell you that I think the mere effort of constantly trying to innovate is the real reason most good innovators succeed.

Why is constancy so important?  Because innovation is not going to be successful as a discrete project.  Innovation faces too many hurdles and upsets the status quo far too often.  If innovation becomes a discrete effort, bounded with a start and end date, then it will not return the results that were hoped for, since everyone can breathe a sigh of relief when the project's finally done. 

As Edison and countless others have demonstrated, you rarely get it right the first time, and if you are stymied by early failure, then you'll never find and implement the best ideas.  Innovation, as has been pointed out by individuals with far more to say about it than me, will create some failures.  Your job isn't to avoid the failures, since you can't predict them in advance, but to reduce the cost and impact of the inevitable failures.  In other words, keep moving.

Another reason constancy is important is that people need to learn how to innovate and learn that it's OK to innovate.  The firms we hold up as innovators - P&G, 3M, Apple, Google, Gore and so on all have long track records of innovation.  3M has considered it a core value for over 70 years.  One could argue that this is a cultural bias.  What I'll say is that anything that gets done repeatedly and successfully over time informs and shapes the culture.  So which came first - the constancy or the culture?

Constancy also has something to do with success.  Even if there are failures along the way, if a firm sticks to its guns and continues to innovate over time, the processes and techniques will improve and the firm will have increasing success.  We all want the home run at the first at bat, but that's rare even for home run hitters.  The Hall of Fame is full of people who played many, many years to achieve greatness, and is notably lacking in "flash in the pan" players.

We at OVO like to talk about consistent, sustained innovation processes that become part of the fabric of the organization - a way of life within the business.  This, in my mind, is the only way to succeed at innovation.
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posted by Jeffrey Phillips at 5:29 AM 3 comments

Monday, January 18, 2010

Innovating in a regulated industry

Here's a news flash for you:  innovation is difficult to accomplish on a consistent basis.  Even more so if the culture and management team of your organization is risk averse.  And few industries are as risk averse as those that are heavily regulated by the federal government or state governments.  Just last week I was told by a prospect that it was difficult to innovate in a regulated industry.  Makes me wonder where all of the phamaceuticals, medical devices, insurance offerings and many other products and services came from, since they weren't hatched from the whole cloth.  It's time to put the lie to "you can't innovate in a regulated industry".

This is, of course, an excuse which allows a company or team to avoid making decisions and stay within the status quo.  It is ENTIRELY possible to innovate within a regulated industry, otherwise we'd never have created a pacemaker (for example) in the first place, and we'd never improved on it once it was developed.  Tell that to people who are living with pacemakers and other implanted devices decades after their surgery.  One might be able to argue that it's more difficult to innovate in a regulated industry, as opposed to an unregulated one, and that might be true.  Regulated industries usually deal with human health, or where there is an expectation of disparate knowledge (financial services, insurance) between the company and the customer.  However, the fact that a firm is regulated doesn't give it a pass for innovation.  In fact, it may make the need for innovation even greater.  Here's why:  heavy regulation builds a comfortable fence around an industry, and the key players within that industry usually agree to divide the market up.  They don't compete and don't offer new products and services, since that would rock the boat and cause work for the entire industry.  Look at many heavily regulated industries - life insurance for example.  There's exceptionally low innovation and rapidly increasing commoditization.  Firms accept the fact that since they are regulated, they should not have to innovate, and all innovation happens at the margins, where disrupters can steal customers away.

Too often, the regulations become a "ceiling" for new products and services.  Rather than dream up new products and services that customers need, then try to revise the regulations to fit those products, firms use the regulations as a hard and fast rule, never to be breached or violated.  They are in a box of their own making and own choosing, and careful never to question the box.  Again, disrupters are going to seek ways to make that box obsolete, and the interesting thing about most regulated firms is that they employ lobbyists, whose job it is to influence or change regulations.  A truly innovative firm would identify products and services that met customer needs, then lobby for the changes necessary to implement those products, and force the rest of the industry to follow.

Regulated products and services face stiffer tests and constraints because they have the propensity or opportunity to damage us in some way - in our wallets or in our bodies.  For that reason they should face higher hurdles for safety and communication.  But that should not stop firms in these industries from innovating.  However, the few firms that do innovate in these industries (ING in banking, Progressive in insurance, St. Jude and Medtronic in medical devices) are considered risky upstarts who disrupt the normally placid waters of the industry.  Good luck to them.  We need as much innovation in these industries, if not more, than we need in search engines, video games and cell phones.
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posted by Jeffrey Phillips at 5:55 AM 13 comments

Friday, January 15, 2010

Innovation Definitions matter

I made what in hindsight is a fairly funny mistake recently.  Working with a new client who wanted to become more innovative, we pressed ahead into a project only to realize that their definition of innovation was to have customers interact with their products in a technology showcase.  When I think of "innovation" I think of teams using a number of tools and techniques to generate and bring to life new products, services and business models.  When this team said "innovation" that's what I thought, and what I assumed.  What they were thinking was something else entirely, and that didn't become evident until we developed a workplan.  Then, the differences in the expectations and definitions were clearly exposed.

We failed at what should be an upfront discussion - that is, what does innovation mean to your firm?  I've been around innovation so long that if I'm not careful I just assume that corporate executives that I'm working with have the same expectations and definitions as I do, and that can be very problematic.  Definitions matter because they drive corporate expectations and commitment.  If it seems "innovative" to have your clients interact with your products in a showcase environment, and that adds value to your organization, great.  But in my mind that's not innovation.  And also not my client's fault.  It's mine, for not taking the time to understand what the word "innovation" meant when they used it, and what their expectations and best outcomes were.

Innovation is one of those words like "pornography" that, in the immortal words of the Supreme Court can't be defined, but we know it when we see it.  Our client thinks it will be considered "innovative" if it allows customers to interact with its products in a high tech, high touch environment.  They may be right.  However, that's not really "innovation" in my mind, because they are not trying to use the facility to generate new ideas or bring new products and services to market.  The center may become a marketing program, meant to create good will and more openness to the market, but not ascertain ideas or seek consumer input.  This won't create new products and may divert funds from other efforts that would create new ideas, so it may be doubly risky, while seeming very innocuous.

The morale of this story is simple.  As innane and obvious as it may seem, when the words "innovative" come out of your client's mouth, stop and ask for an example or a definition.  If they can't provide one, then work with them to create a definition that you, and they, agree is correct, because there's simply too much room for assumption, and error, when the word is taken at face value.  Too many firms, and too many people are simply throwing the word around for advantage, which leads to misguided expectations and disappointed consumers.
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posted by Jeffrey Phillips at 5:28 AM 6 comments

Thursday, January 14, 2010

Just do something!

I'm constantly amazed by all the talk about innovation that I hear within many organizations, and how little real action is taken.  It's time, my friends, to gird up your loins and take action.  Let's borrow the motto from Nike and decide to just do something.

If you are waiting for the sign from above (by that I mean your executive management) that you may now go and be innovative, stop waiting.  Even if the sign comes, it will be so watered down and so filled with misdirection and uncertainty that you wouldn't act on it anyway.  Act now, even in small ways to develop innovation activities and skills, so that you can then build on those activities and flesh them into new ideas, and new products and services.

When I say this to many mid and senior level folks I talk to, they want to know:  what can I do to make a difference?  There are a host of small actions you can take to start innovating, and as you do you'll build credibility and will attract others who are interested and want to work with you.  If you never start, you'll never build the community or team you need to succeed.

Here are just a few things that are very easy to do, and very inexpensive to do, that just about anyone in any firm can do to add value and start innovating.  Once you do these things you'll build your credibility and get to do even more.

  1. Document trends and provide your sense of what they'll mean for your business in the near future.  Yes, I know this isn't your job, but as it turns out it's not anyone's job in most businesses but everyone needs this synthesis.  A well organized consolidation of trends, transitioned into a document that provides shape and clarity to a potential future outcome, is helpful to any organization.  And, since no one else is doing it, you are now the expert.  If someone disagrees, then you've attracted a compatriot who can work with you to provide a counterpoint.  All innovation starts from recognizing an opportunity, issue or threat before others do.  Trend spotting and synthesis can get your team there first.
  2. Observe your customers.  Go read the complaint letters.  Read what people are writing about you online on Facebook or Twitter, or other blogs.  Go watch your customers use your products.  Become a customer of your products or services.  Write down what you like, and don't like, about your products.  This is free Voice of the Customer and Ethnography.  As you do this you'll gain insights into unmet unarticulated needs, which are also a great opportunity for innovation.
  3. Use brainstorming and other idea generation tools as frequently as possible, and use them in the right situations and contexts.  Rather than pull a rarely used tool out of the toolbox ocassionally, use the tools regularly and effectively.  In that way, idea generation doesn't seem so artificial, but a natural part of doing business.  And since you're doing it regularly, you learn more about how to do it well.
  4. Read the best books about innovation, to learn more about the best practices and tools, so when there are opportunities for innovation, you can recommend the appropriate tools and techniques.  Learn to be a good facilitator, and understand the rules and techniques for idea generation.  As your skills grow, you'll be asked to lead idea sessions for other teams.
There's always something you can do, and starting now is much better than starting when you finally get the OK.  In many firms, the OK may never happen.  Create a small innovation capability and generate ideas about the future, new product and service ideas, and help other teams generate ideas.  You'll attract others who have similar needs and interests and gain incredible credibility.  Eventually you'll be the go-to person for innovation.  Don't laugh, I've been in at least two organizations where the head of innovation was simply the person who started doing innovation and was eventually recognized as the expert.
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posted by Jeffrey Phillips at 12:37 PM 4 comments

Friday, January 08, 2010

Innovation waits for no man

One of my partners, who is an electrical engineer, let out a loud cry a few minutes ago.  He was responding to an article I sent him about a new electical gizmo that monitors eletrical usage in the home.  He was upset because he came up with a very similar idea about a year ago, but he failed to move on it and assumed it was safe to put on hold for a while.

This points up an innovation fallacy, and a separate truism.  First, the fallacy.  Good ideas are rarely conceived in isolation.  Even really good ideas often happen in several different places relatively simultaneously. So while you may think your great idea is unique and original, there's a good chance it isn't.  The truism that follows is that it's not the individual or team that conceives the idea that wins, it's the individual or team that commercializes that wins.

Let's look at the fallacy first.  As is fairly well documented, Newton and Leibnitz conceived calculus at roughly the same time in history with no interaction.  Alexander Graham Bell and another inventor applied for patents for the telephone on the same day.  Good ideas to solve seemingly intractable problems or address emerging opportunities are rarely unique.  Simply ask yourself - have you ever seen a new product or service and thought "I thought of that years ago".  There are enough smart people reading the same news and watching the same events unfold  as your team, so many ideas are likely to be spawned simultaneously in a number of geographies or in a number of different companies.

This places all the more emphasis on commitment to your ideas.  If you have a good idea, then you need to move as quickly as possible to prototype it, pilot it, assess it and gain customer feedback.  Don't assume you have time on your side, or that your idea is significantly unique.  The latter is a fallacy and the former is a trap.  Time is not on your side.  As people become more aware of opportunities or challenges and attempt to create their own solutions, more people will try to innovation a robust solution.  Some of those firms won't have the scruples to evaluate, test and refine their ideas.  They'll stick an idea out there, gain feedback and learn from their products and mistakes. 

Innovations wait for no man.  Since it's easy to show the same ideas are often conceived by disparate groups at roughly the same time, you need to be prepared to move on your ideas as soon as possible.  This means you need a process or methodology to enrich, nurture and develop ideas quickly, and a piloting or feedback loop to gain customer feedback.  Once you've received the feedback, you may then decide the idea is too nascent or the needs still too undefined for your idea, and place it on the shelf.  Otherwise, someone else is likely to beat you to the punch, and leave you yelling at your monitor that you had that idea a year ago.

The race goes not to the swift or the battle to the strong, but success in innovation goes to the confident team prepared to act on its ideas.
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posted by Jeffrey Phillips at 11:17 AM 5 comments

Wednesday, January 06, 2010

The innovation "silver bullet"

When I was a kid, only the Lone Ranger and Werewolf hunters used silver bullets.  It was never really clear to me why a guy in a mask with a native american counterpart needed fancy bullets, but who's to say?  The need for silver bullets when hunting unholy creatures of the night makes more sense to me, at least in an allegorical sense.  What isn't clear at all is when the "silver bullet" became synonymous with a big win.  And, more recently, why anyone would want a "silver bullet" in innovation.

Today's diatribe was sparked by a recent Accenture survey of executives about innovation.  One question asked the executives to respond to "My organization is looking for the next silver bullet rather than pursuing a portfolio of ideas".  Executives could strongly agree, agree, remain neutral, disagree or strongly disagree.  58% of the executives who responded strongly agreed or agreed with this statement, and another 16% were neutral.  Of course every firm hopes for significant, disruptive returns from innovation, but placing these unreasonable and outsized bets on innovation to deliver the one "giant killer" idea is unrealistic and unfair to the innovation teams.

What's wrong with a big, hairy audacious goal?  Nothing.  But when you place so much emphasis on one exceptional idea, you create a number of terrible outcomes.  Those include:
  1. Ignoring a number of really good ideas since they aren't the "silver bullet"
  2. Placing unreasonable expectations on teams that aren't used to innovating, which are already under significant pressure with limited resources and timelines
  3. Placing all of your eggs in one basket
As I like to say, when I go hunting for whales, I like to keep my eyes open for the other big fish.  If I bring home a tuna or marlin, I never come home empty handed.  But if, like Ahab, I am so single minded that only the big white whale will do, then more likely than not I'll come home disappointed.  Big, game changing innovation is difficult to do, even in firms that do innovation well.  It's notoriously difficult in firms that under-resource innovation or don't have good methods or processes, or a culture that resists innovation.

What I'd prefer to see, and what we at OVO advocate, is the development of a portfolio of ideas, spanning the gamut from incremental to disruptive.  What we know about innovation is that many ideas won't become new products and services, starting out we just don't know which ones will fall by the wayside.  Working a broad portfolio means that even when some ideas fall out, some still remain.  Chasing one single, game changing silver bullet idea is impractical, often wasteful and usually doomed.  And once a team fails to deliver that silver bullet, innovation is ruled a failure, when it was the goal, not the process, that was the problem.

Are our management teams really that strategically bankrupt, to demand a "silver bullet" idea?  Does every executive team demand the "iPod" of their marketplace from their innovation teams?  Are these simply mind games that executives play to "stretch" the thinking of the teams, or do they actually expect these kind of ideas are laying around for the taking?  Note that exactly one "iPod" idea has been generated in the MP-3 market in the last decade.  If this is so easy and so straightforward, why hasn't there been a disruption in that marketplace?

Silver bullets are for killing werewolves.  Innovation is for creating a pipeline of incremental and disruptive ideas for new products and services.  Any executive who demands a "silver bullet" from an innovation program doesn't understand the purpose of innovation and has unreasonable expectations about the outcomes.
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posted by Jeffrey Phillips at 1:56 PM 2 comments

Tuesday, January 05, 2010

Innovation Needed Now - Education

Braden Kelley occasionally posts requests for innovation bloggers to respond to questions or topics that his readers or bloggers submit.  His latest one was "what product or sector is in most need of innovation".  This question allows me to kill two or more birds with one stone.  My recommended area most in need of innovation is the education system, for several reasons.

First, the primary and secondary education system in this country is based on learning models from the 19th century.  While there has been significant change in almost all aspects of life, a 2nd grade teacher plucked from the late 19th century and returned to earth would be bewildered by most of what he or she encountered, except the pedagogy within the average classroom.  Sure we don't emphasize rote memorization anymore, but short of that the curriculum and teaching methods haven't changed.  One could argue that's because there's been so much success, but on any relative scale we can demonstrate that the educational system is failing miserably.  So we have a rigid educational program steeped in tradition that is demonstrably failing.  The educational system must innovate in order to be relevant.

Second, regardless of the tradition, we aren't teaching kids how to learn, or teaching them relevant skills, and are often channeling all of the kids in an educational system into a collegiate experience.  This one size fits all educational outcome, where in some schools over 90% of students have college aspirations, neglects the fact that many won't complete college and will require other skills to generate income.  Why do we continue to prepare the students for "knowledge worker" jobs when clearly there are many demands and opportunities, and proclivities for other skills?  We need to resurrect the concept of apprenticeship and place more emphasis and value on learning skills beyond the classroom.  We need better definitions about what kids need to know, and more importantly, we need to teach them how to learn and how to teach themselves and others.

Third, the disrupters are out in force. Since most educational systems are government monopolies rather than private enterprises, there's little innovation and little incentive for new entrants.  As it is, many states have begun to experiment with charter schools, for-profit schools and many parents are turning to home schooling.  Given the difficulty of starting alternative educational programs, and the rigidity of the existing educational bureaucracy, these experiments are too little and may be too late.  We are at risk of losing a generation of students who have been taught inadequately and are unprepared for many of the roles and responsibilities they must take on.  The state governments and localities must act to allow much more experimentation, and universities must require more from people who want to teach, and must create new teaching and educational paradigms.  If we aren't careful, businesses will go back to the beginning and create their own schools, to ensure a consistent flow of knowledgeable students with excellent experience.  If you can't get the right raw materials, you create or purchase your own sources.  At one point it was argued that home schoolers were the nut cases who for behavior or religious reasons kept their kids at home.  Since home schooled kids have proven very adept at getting entry to prestigious colleges, more and more people are pulling their kids out of primary and secondary programs and teaching them at home.  This runs the risk of weakening the social fabric, if we don't have shared educational experiences, but these home schoolers are merely demonstrating that they believe they can innovate the educational model.

The educational system in the US is clearly failing - failing the students, failing the teachers and failing to create people who can join the workforce or create their own companies.  In most factors the US ranks well down the list in terms of educational achievement.  Only greater demand and political pressure will encourage more experimentation and more innovation.  At this point we need disruptive innovation - a complete rethinking of the pedagogy, curriculum, technology and intent of education, followed by a restructing of how education is offered and consumed.  If we can completely rework the health care system in the US in just over six months, with the right focus we can rework the educational system and create a more powerful, relevant educational experience for our children and grandchildren.  We need to do this NOW.

Recently there was an argument about whether or not a school voucher program in Washington DC should continue as a pilot program.  Only 1700 kids were receiving vouchers to go to private schools, and by most accounts were doing very well.  That program was threatened with termination, not because the funds were lacking or because the students were doing poorly, but because the program threatened the educational monopoly.  For those of us who care about better education for everyone, in every program at every level, we need more innovation, faster than ever, in order to overcome the entrenched bureaucracy.
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posted by Jeffrey Phillips at 1:40 PM 9 comments

Innovation Fail

I've been thinking a lot about the linkages between innovation and failure.  Too often we in the innovation space want to dumb down failure, make it seem safe and reasonable.  And too often many in the corporate space draw up scary creatures dressed up as the possibility of failure, to avoid having to innovate at all.  So, herewith, a rambling diatribe about innovation and failure.

First, let me start out by saying that too often innovation is a game of chicken.  A team generates some ideas and under significant pressure for speed and success picks one to champion.  At that point anything other than a resounding success is a failure, since a true failure (the wrong idea, the wrong market, the wrong time) is pretty easy to diagnose, and a marginal success (fast follower, wrong pricing, wrong channels) doesn't seem worth the effort.  Failure in many organizations is based on a catastrophic incident, where the ONE idea that had been championed and worked on didn't succeed.  This means all the investment is lost, and, what's more, there aren't any other viable ideas in the hopper.  This kind of failure is easy to modify.  We simply need to reduce the COST of failure.  That can be done by keeping more viable ideas in the hopper and by finding simpler, less expensive ways to test ideas before we commit to them fully.  After all, it's not likely that every idea in an organization will be a winner - some ideas will not succeed in any case - but choosing a needle in a stack of needles is a high risk game.  If we can find ways to reduce the cost of failure, or perhaps spread the cost over more ideas, then innovation seems less risky.

Another thing about "failure" is that we try to kid ourselves that failure is a "good thing" a learning opportunity.  Well, not in most cultures.  When I was first coming along, one or two big failures in any organization was considered a "career limiting move".  I doubt that most corporations have evolved into coddling individuals who consistently fail at what they do.  These tendencies, of course, fly in the face of experimentation and limit the range and scope of ideas.  Too much penalty for failure will result in only very plausible ideas, which really isn't innovation, just incremental improvement.  For real innovation, someone sooner or later will need to swing for the fences, and while home run hitters are exciting, they are also the ones most prone to strikeouts.  So this leaves us on the horns of a dilemma:  for successful innovation, we need spectacular ideas which may also lead to spectacular failures.  On the other hand, spectacular failures often lead to the opportunity to seek new employment.  Again, we can't kid ourselves that failure doesn't matter or is always a "learning experience", but we need to find ways to reduce the cost of failure and increase the ability to experiment.  After all, if there were no risks then everyone would want to innovate.  And perhaps that's what puts the lie to "everyone can innovate" because many people simply can't stomach the fear of failure.  But what's interesting is that they actually hold the reins to many of the monsters they fear.

Another remedy might be to seek the causes of innovation failure.  Often, many of the causes or symptoms are under our control.  Some factors we can control or at least understand.  Probably the most important factors that firms ignore or misunderstand are trends and unarticulated needs - in other words, the context and opportunities for innovation.  Typically we start with a problem and generate ideas, ignoring the environment, the strategy and the context for the idea, or simply assuming they remain the same over time.  Then we are surprised when the ideas don't align to needs in the customer base, or that someone else has beaten us to the punch, or that we've solved a problem that has been solved before (also known as being late to market).  Many causes of failure in an innovation context are within our understanding, if not our outright control, and the fact that too little strategic thinking, plannning and foresight is part of an innovation effort is often the cause of the failure.  Just as you wouldn't start a climb of Everest without careful planning and strategic thinking, why would you kick off a disruptive innovation project without the same investment?  That can only lead to failure, and that is failure that you could have foreseen and avoided.

Much like the monsters in "Where the Wild Things Are" we build up FAILURE as a terrible monster, but with careful consideration we can understand that failure can be tamed, if not eliminated.  It is important to understand that many of the causes of failure lie within our understanding and possibly within our control, and that failure is an opportunity to learn something new.  But with any opportunity for great rewards come some risks, and we shouldn't discount failure but use the threat of failure to sharpen our actions and our thinking.  Find ways to reduce the cost and the impact of failure in innovation.  Educate your management team to the costs of innovation and the realities that some ideas will fail.  Understand the factors within your control to reduce the likelihood of failure, and build in communication mechanisms to communicate what was learned or what can be reused when failure occurs.
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posted by Jeffrey Phillips at 5:48 AM 2 comments