Wednesday, October 10, 2007

Context is King

When you closely consider any important business function, it's fairly clear that most people within the function or process understand their roles and responsibilities. Since many business processes are based on consistent, repeatable transactions, it becomes easy to move up the learning curve and gain a deep understanding about how a process works and how it can be improved.

Innovation, however, doesn't work this way, for at least two reasons. First, in most firms there simply isn't a defined, consistent process for innovation. Frankly, in most firms, people simply invent an approach once they think they have a winning idea. That's not optimal but can be overcome. But what's really interesting is the second issue with innovation - context.

If I am part of the purchasing process, I don't need any context. I know that a requisition needs to be changed into a purchase order and placed with a vendor. Transactional processes have their context embedded in them. Innovation, on the other hand, needs to attach context to every idea or concept. The reason this is true is that an idea tends to be very fluid, and without context may be hard to evaluate or even consider.

This is one of the key reasons why suggestion boxes fail. People will place ideas in a suggestion box, but unless they define the context of the idea closely, it can be difficult if not impossible to evaluate the ideas. Additionally, if the idea isn't aligned with the needs of the firm or the corporate strategy, (also context) it will probably be ignored. Once an idea is generated, if other people are to consider, evaluate, prototype or test an idea, they need to understand the context of the idea - what problem it solves or opportunity it addresses, how it will be applied, its benefits and costs. Without this information, an idea is simply too disconnected to adequately consider, evaluate and convert into a new product or service.

Context comes in several dimensions. First, addressing the problem to be solved or opportunity to be addressed. Second, comparing the idea to existing solutions or proposed solutions. Third, finding teams or functions that can approve and adopt the idea. Fourth, determining the value of the idea. In a traditional transactional process, an individual doesn't need to consider these concepts. In an innovation process, context becomes the most important arbiter of success.
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posted by Jeffrey Phillips at 5:01 AM


Blogger James Todhunter said...

Hello Jeffery,

You are spot on about the importance of conext for innovation. I just got back from a two day working conference focused on innovation. A recurring theme was that one of the attributes of innovation is that it must generate value.

But, value is a highly subject thing. The frame of reference from which one considers a concept will influence the value perception. This is where context becomes pivotal. Unless all participants in the innovation value chain are aligned around a common understanding of the situational context, failure is almost a certainty.

When the goals of the customer, the enterprise, and the innovation worker are in sync, the innovation outcome will deliver value to both the customer and the enterprise.

10:14 AM  
Blogger Greald said...

Dear Jeffrey,
I think we are very close in our thinking.

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