Thursday, May 22, 2014

Innovation and the Hype Cycle

Perhaps one of the most challenging issues regarding innovation is the lack of an established definition.  Oh, sure, some will say innovation is defined as "new ideas that deliver value" or another variant, and they'll be right.  But the story doesn't end there.  Innovation has either lost all meaning or has so many situational context meanings as to be practically meaningless.

I wanted to talk about the hazy definition of innovation and the impact it has on the adoption of what we believe is the most important aspect of innovation - innovation as an internal competency.  You see, the definition of "creating new ideas that provide value to customers" is OK, but it can apply to firms that consider that a statement of strategy, or firms that perform the activity haphazardly and periodically.  While neither of these instances are representative of successful innovation outcomes, both in general terms can be described as innovation. And it's for this reason that many commentators, pundits, cynics and general curmudgeons like to say that innovation is futile, dead, passe or other negative adjectives.

The Gartner Hype Cycle

Gartner, in their wisdom and having the opportunity like Zeus to scan the history of information technology, noticed that all new concepts and technologies proceed through a predictable "hype cycle".  Typically that begins with a lot of promises about what the new technology will do, plunging into the pit of disillusionment as people realize that the new technologies are just that - technologies not solutions.  Then enterprising entrepreneurs and others build meaningful solutions which incorporate the technologies or capabilities and provide meaningful solutions, so the stock of the technology rises again.  I've provided my own "innovation" hype cycle below, but with a twist.

Innovation, you see, must be carefully defined before we plop it into any strategic framework.  I'll argue that innovation as a strategy or theory is well accepted.   On the Gartner hype cycle innovation as a strategy or theory is on the "slope of enlightenment". Clayton Christensen did that for us, and now CEOs and senior executives in most industries laud the benefits and bake innovation into their strategic goals.  Innovation as a theory or strategy is reaching the "plateau of productivity" after plunging into the trough of disillusionment five to ten years ago.

On the other hand, innovation as an activity, that is, where innovation teams are off working on creating new products and services based on an identified need or new market opportunity, is just emerging from the trough of disillusionment.  Discrete innovation activities have rarely delivered what was promised.  Several recent studies indicate that most innovation activities don't deliver the promised results.  Some of that can be chalked up to mismatched strategies, unrealistic expectations, poor skills and training and an overhyped capability.  But right now we are on the verge of better innovation projects, but that's not what we want to ultimately optimize.

If you'll look further to the left you'll see one more innovation concept - innovation as a core competency or discipline.  In my opinion that concept is just reaching the peak of the hype cycle, and trails innovation as a project.  The difference is that innovation as a competency builds infrastructure, skills, methods and processes to simplify innovation projects and reduce cultural resistance.  Yet far too many firms have considered innovation an occasional, one-off activity rather than a repeatable, consistent discipline.  When firms wake up to the need for more capability and discipline, then it too will complete the hype peak and plunge rapidly into disillusionment, as innovation teams, centers of excellence, Chief Innovation Officers and others are unable to prove value, because until innovation as a strategy or theory is fully embraced and understood, it's difficult to invest in innovation as a competency or discipline.

Of course, like most management fads we've done this backwards, top down instead of bottom up, demanding meaningful results before capabilities were developed, weak, ill-fated experiments that were easy to ignore.  Today we've finally got executives who think that innovation is important.  They aren't sure what that means, but they want more innovation when possible.  Can we restrain ourselves and offer up innovation skills and competencies before plunging into innovation activities?  So far the results say no, and if all innovation focus is placed on innovation projects and activities, you could see all three of my innovation definitions dragged into the trough of disillusionment.  Things don't have to progress only to the right, they can slide back to the left, especially into the pit.

When an employee or consultant asks you what you mean when you say "innovation", it's not a throw-away line or a philosophical debate.  Defining and understanding the difference between innovation as a strategy, as a discrete, one time project or as a capability or discipline has implications.  Words matter, especially words that have hazy definitions that we allow others to define for us.  Executives, senior managers and innovators, pay close attention.  Define what innovation is, what it means, its purpose and goals, before anything else, or you too will end up a victim of the hype cycle.

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posted by Jeffrey Phillips at 8:26 AM


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