Monday, January 18, 2016

Innovation in the file cabinet

Not long ago our innovation team was asked by a client to lead an innovation project to create a new product.  As always when we are asked in by a new client, we did a quick survey.  It's important to understand what the client knows about innovation, what they have learned or attempted previously.  Innovation can be strange and new, and if other tools or methodologies are familiar or in use, it's often valuable to incorporate them into our processes if possible, rather than ignore them.

In this case we were told that Yes, the client had adopted another consulting firm's innovation methodology.  In fact when we met with the client team, they provided a binder of information on a step by step innovation process, that from the looks of things was relatively straightforward and complete.  Of course every consulting firm has its own ways of doing things, and there are factors and characteristics that will differentiate one consulting firm from another, but at the heart of the matter innovation is always about defining challenges, understanding future market needs and conditions, gathering customer insight on unmet needs or jobs to be done and generating solutions.  That's the basic "front end" in a nutshell, and no matter how you spin it or package it, all innovation programs have some flavor of these steps.

Anyway, back to the client.  As I noted, the client team pulled a binder out and showed us another consulting firm's methodology.  They presented sample deliverables.  They presented a sample workplan.  And at some point I began to wonder:  what do they need us for?  All the step by step instructions, all the information necessary to innovate was here.  Had they adopted this methodology, I asked?  The answer, as you might have guessed, was sheepish.  No, the client team responded.  The other consulting firm had built the process for them, given them "training" on the process and the client team had agreed to "take it from there".  A year later, no innovation had been completed, because no one was there to reinforce the innovation process, too many other priorities had sprung up to compete with innovation, and it seemed a bit unusual and risky.

Needless to say, I was both shocked and relieved.  Shocked that so much effort had been expended to develop a reasonable innovation program that had not been implemented.  And relieved to note that virtually none of it had had an impact on the team or company.  Which meant we could ignore it as part of our effort, much as the client team had ignored the existing materials.

Innovation in the file cabinet

While the client shall remain nameless, this is in fact a situation that occurs quite frequently.  From an innovation methodology or process point of view, there are very few companies that are truly "green fields".  Most have heard of innovation, many have purchased books or sent people to innovation training, and a fair number have partnered with one or more innovation consulting firms.  Yet far too often when we do our initial reconnaissance to determine what a client has done from an innovation perspective, all we find are old methodologies that reside in a binder, somewhere in someone's file folder or file cabinet.  Do they have innovation processes or methodologies?  Sure, if what's buried in the file cabinet counts.  No one wants to appear unprepared, but many simply haven't implemented what they have.

Why would firms pay for innovation training, advice, methodology and consulting and then shelve all of the knowledge?  There are a number of reasons, but the most important ones have to do with priorities and risk.  Steven Covey introduced the idea that managers spend time on things that are URGENT or IMPORTANT.  Innovation falls into the category of IMPORTANT.  It is important that a company create new products, or develop a new business model.  Most day to day operations fall in the category of URGENT.  It is urgent that we respond to this competitive move or that new piece of legislation.  And, as Covey noted, the URGENT always beats the IMPORTANT.

Good innovation knowledge, methodologies and training ends up on the shelf because the teams in question don't have the bandwidth, the resources, or the approval to pursue new and interesting ideas.  Heck they can barely keep up with the day to day stuff they are tasked with, much less add on new projects.  Innovation training and inspirational speeches amp up enthusiasm which is quickly overturned by business realities.

General aspiration or firm commitment

Here's what you need to know if you hope to do any innovation, at any level of the company:  is innovation a general aspiration, or a firm commitment?  Aspirations are important, but often lack the resources and investment necessary to implement.  Further, Aspirations talk about change but don't have the commitment to make the change a reality.  Innovation requires a firm commitment, from senior executives who are willing to change the status quo, and who will resource interesting challenges and projects immediately, with the best people.  Firm commitments are signaled when innovation projects get top billing, when the best people clamor to join those projects and when they are adequately resourced and regularly called on to report advancement and achievement.

You'll need to quickly work out each innovation request, to see if it is a firm commitment.  There are a few signs that can signal the breadth and depth of commitment.  First is the level and commitment of the person who demands it.  CEOs demanding innovation are a dime a dozen: they all demand innovation but don't follow up.  Executives who demand innovation and strip their best people from other activities or redirect resources and funding to innovation create a much clearer picture.  A second opportunity to demonstrate clarity is by defining an interesting and valuable scope.  Rather than simply ask for "innovation", people with true commitment ask for a new solution that's X times better than what's in the market, for a specific set of customers.  Innovation without scope is boiling the ocean.  Finally, you'll get a sense of the depth of commitment by the way activities are measured.  If no one every bothers to understand how innovation is proceeding, if there aren't frequent assessments of the effort, then you know that the effort isn't serious.

The reason so much innovation methodology, process and knowledge ends up in binder on bookshelves and file cabinets is that there's exceptionally little follow through on the part of executives. These individuals want innovation, but don't want to disrupt the status quo, so their innovation becomes aspirational rather than a firm commitment.  And when that signal is received by a designated innovation team, the materials go back on the shelf, to wait for another day when the commitment is higher.

Out of the file cabinet

The problem with innovation in the file cabinet is that it isn't being exercised.  If you have a method or process, implement it, learn it and perfect it by doing innovation.  It will be difficult and messy at first, but like any human endeavor you'll get better with more practice.  Parking the information in a file cabinet does nothing for anyone, in fact it is a waste of time and develops internal cynicism when people know they've received training or been introduced to a process they aren't encouraged to use.

Which, of course, raises the final question:  should corporate teams even try to innovate internally, or should they simply rely on external consultants to help generate ideas, or acquire other technologies or companies?  The simple answer is that doing innovation well is difficult, so perhaps we should outsource innovation.  But that leaves aside the question of integrating new ideas, technologies and products built by others into an existing portfolio of products and services.  Which can easily become a jumble of disparate solutions with no common theme, when you constantly seek to purchase ideas from the outside.  Innovation can be outsourced, but the transition of new products and services into the existing corporation can be very difficult.  With this in mind it is always better for a firm to build innovation capabilities, even if most of the work is outsourced, because when ideas originate internally there is a practical transition path to new products and services that is developed, which can help external ideas and products as well.

Getting innovation knowledge and expertise out of the file cabinet and into every day activities is important, and the importance increases daily, as new competitors enter the market and old industry conventions crumble.  Building on investments you already have or knowledge and skills already developed will be crucial for long term success.
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posted by Jeffrey Phillips at 7:04 AM


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