Wednesday, April 13, 2016

Here comes the hypenated innovation offering

It's almost inevitable that innovation will grow to become an amorphous blob of ideas, techniques, processes, "experts", software and a host of other things.  It's the natural order of economics that when an opportunity is available, everything rushes in to fill the vacuum, and as the market becomes crowded various offerings must differentiate themselves from the others to demonstrate value.

It's like this with cheese, wine, beer (remember when there was only Budweiser and Miller?  Now you can have chocolate beer, artisanal beer, birch beer, pumpkin beer, beer from the mountains, from the coast, etc) and a host of other products and services.  Unfortunately, we are reaching peak innovation offering, which means we'll soon see the dreaded hypenated innovation offering.  We'll know we've reached peak innovation insanity when someone writes the "Chicken Soup" for innovators souls book.  Coming soon to a bookstore near you.

This slight rant of mine was started when I saw a new software application talk about its ability to help its clients in agile lean innovation.  Agile is a word adopted from software development, which is really just about stripping away a slow, steady development process replacing it with short "sprints" to complete a few features at a time.  Lean is about stripping away unnecessary assets to focus on doing the most with the least.  In case you haven't been around innovation very long, few innovation activities have too much funding and staff.  Most are already lean, but not intentionally.  And most are already sprints, because the people involved have other jobs they need to get back to. So the software purports to assist innovators in what they already do.

But we can expect to see much more of this - the unintentional obfuscation of innovation. As we pile on more modifiers and adjectives to define and differentiate innovation, we ought to take a moment to remind ourselves that the basic idea - developing interesting new products and services that fill a need that people have, and that those consumers want to buy - is not yet fully understood and incorporated as a strategic endevour in many companies.  Sure, executives talk about the importance of innovation, but they don't really know what it means.  Like the Supreme Court judge said of pornography, he may not be able to define it but he knows it when he sees it.  If the basic concept we are trying to modify isn't well defined or understood, what's the point of adding more adjectives and modifiers?  We simply risk creating even more confusion.

The Basics

Innovation, at least in the corporate world, should be defined in this way:

using creativity to create new ideas that address unmet needs that customers have and using those ideas to create new products and services that customers want to purchase, and which create differentiation for the company.

That's a good, basic definition of innovation, and believe it or not most companies don't have a common, shared definition.  Once one exists, it's easier to get people to align behind it.  Only then should we modify the definition by noting that innovation can be incremental, meaning small changes to existing products or services, or disruptive, completely new concepts that radically change the existing market structure or change industry dynamics.

Further, innovation can result in a number of outcomes.  We definitely use innovation to create new products, but also we can innovate new services, new customer experiences, new channels, new value networks and new business models (attribution here of course to Larry Keeley).

Layering On

Once we define what the act of innovation is, and what some of the potential outcomes can be, then we can define the methods of going about innovation - the "how" if you like.  This is where terms like "agile" or "lean" can come into play.  We at OVO often talk about "rapid" innovation, trying to start, conduct and end innovation before the culture becomes aware of the activity.  You can talk about "open" innovation, which is simply working with external third parties to exchange ideas, technologies, intellectual property or other tangible or intangible goods to make or improve ideas.

As your definitions improve and your team grows competency, then you can add complexity to the innovation definition and process, leading to...

Full Obfuscation

Then, of course we can begin to combine adjectives, types and modifiers, so we can expect to see something like Agile Open Radical Customer Service Innovation.  This is of course a combination of process, type, outcome and degree.  The ultimate obfuscation will arrive when experts debate the merits and rankings of various types of highly modified innovation, much the same way as ancient theologians argued about the number of angels that could dance on the head of a pin.

All of this obfuscation is dangerous and does nothing to assist the average innovator or the executive who must make innovation choices and fund innovation projects.  There is no better or worse innovation activity, process or outcome:  each activity should be driven by corporate needs, competitive realities and strategy.  All innovation types and outcomes are viable and necessary depending on the circumstances.  Unfortunately, given all the hubbub and lack of clarity, most decision makers settle for the simplest and easiest innovation type:  incremental product innovation, because it's easily understood and has little apparent risk.  But what you are doing is making decisions and setting policy based on the least common denominator.

When thinking about the language, definitions and modifiers that clog up innovation conversations, marketing and decision making, remember four important things:

  1. What outcome do we want to achieve:  a little more revenue, or make a significant "dent in the universe"
  2. What is the best method or process for us to achieve that goal:  working internally, working with partners, etc
  3. What type of outcome helps us achieve our goal: new product, new service, new business model, etc
  4. What do we as the leadership team need to do to see that the effort succeeds
If you can answer these questions, you will discover that each innovation activity deserves its own modifiers and adjectives, and the cycle should renew itself each time.

The more attention a market attracts, the more charlatans enter and the more obfuscation will be created.  Innovation, at its heart, is simple, but requires a lot of commitment and courage.  Like scaling sheer cliff walls, those who do it best use only a minimum of trusted tools.  Experts need very little accoutrements when they do their work.  Naive beginners lard up the process with every tool, trick, technique and process.  Go back to square one for greater success.  Beware of the constantly hypenated innovation solutions. 
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posted by Jeffrey Phillips at 5:53 AM


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