Tuesday, May 31, 2016

Innovation is a feature

As a marketer who was first an engineer, I am often guilty of larding up my marketing content with facts about features.  As we used to say at Texas Instruments, I can quote "feeds and speeds" all day long.  We can talk about faster processors or larger memories, more sophisticated storage devices and the ability to stream video at close to the speed of light.  And so on.  Marketers should get pilloried for this nonsense, because we are selling the steak and not the sizzle.  Marketers who talk about product features forget that people buy products to solve problems or to achieve some stature.  They buy the benefits, in other words.  I've often said that in the end few people care HOW something gets done as long as it gets done effectively.

This marketing problem has now fully transitioned into an innovation problem.  The reason this is an analogous problem is because executives are moving through their organizations and talking to their boards about innovation, as if innovation is a deliverable, an outcome or a benefit.  It is, in fact, none of those things.  Innovation at its best is a continuous process, at worst an occasional activity, but in either sense it is the HOW of something, not the WHAT.  Innovation is a feature, what it creates should deliver benefits to someone.  Yet how quickly we forget.

To many organizations, the idea of innovation is enticing.  They look at other companies that are "innovative" and gaze admiringly on all the new products and services that drive more revenue and profit.   It seems that all one must do is claim to be innovative and more profits and revenue will accrue.  When that fails, the nascent innovator then decides to actually become more innovative, trying to generate new ideas and move them into product or service development.  This is when they discover that innovation is not a deliverable, and during the implementation of an innovation capability or culture it certainly isn't a benefit, because attempting to "bolt on" an innovation process to a competent efficient culture is like dropping a modern 8 cylinder engine into a Model T.  In theory it should work, but the results often aren't all that appealing.  And in case you were wondering about the analogy, the modern 8 cylinder refers to the existing corporate processes and practices, which operate on "all cylinders" efficiently.  The Model T is the structure you try to build to use the existing processes in a new way, to innovate, and it typically ends badly.

Innovation is a feature of an organization or a culture.  It is not a benefit to customers.  In fact to many customers new innovative products aren't benefits, because these new capabilities require existing customers to change.  Some will change gladly, some will change if forced and some will never change.  So innovation may require that you piss off a portion of your existing customers and acquire a bunch of customers who have been ignored or overlooked, or who never considered your solutions before.  You get these customers because the innovations you create have benefits that they want or need.  And, it's also necessarily true that more innovation does not lead to more benefits.  Incremental innovation extends existing benefits to some degree, so lots of incremental innovation does not guarantee a lot of new benefits.  This is why so many corporations consider innovation a failure - there's a lot of activity but not much motion, because all of the effort is constrained to such a small space. 

Like any compelling phenomenon innovation has reached and passed its apex of awareness and promise and to some extent collapsed into the trough of disillusionment.  Now, new carnival barkers are promising better rewards through hyphenated innovation:  agile innovation, rapid innovation, design thinking innovation and so on.  Clearly, simple, general innovation is a significant disappointment, so we are working to re-categorize it rather than look at the misplaced expectations and lack of commitment.  Instead, simply strip it back to its base elements.  Ask:  what is innovation for?  What are we trying to deliver to customers?  What do they want or need?  Can we create that within our business, or must we rethink or re-imagine what our business is?  How disruptive must our thinking become?  What benefits does the customer need?  What problem must they solve?  What unmet needs could be addressed?  If you'll revert back to a simple question driven methodology, always keeping in mind that innovation is an activity or a feature, and not a deliverable or benefit, then innovation will take the place it rightfully occupies.
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posted by Jeffrey Phillips at 11:42 AM 0 comments

Friday, May 20, 2016

Can you teach people to innovate?

One of my recent pet peeves is the proliferation of education options for innovation.  One of my alma maters offers a "certificate" for innovation management.  While I cannot comment on the course, it is taught by two professors with little private sector experience who haven't created a product. One of them is a psychology major, which I guess makes sense because innovation is often the product of new or unusual insights or perspectives. 

You'll forgive me for a startling lack of enthusiasm about many of these "educational" offerings.  There are several reasons for my skepticism:
  1. Innovation is strange, unusual work, very different from what most people do day to day
  2. It doesn't require great insight or difficult tools, but does require working against considerable resistance in existing cultures and customer expectations
  3. You don't educate someone in "innovation", you educate them in a set of tools, expectations, perceptions and beliefs.  The combination of these factors enables innovation to occur.
  4. No matter how much you train people, they can only implement the tools and techniques if they are allowed to
  5. There is no commonly agreed innovation standard.  Perhaps the closest anyone has come is in Creative Problem Solving, which I would think is probably the best answer to innovation training.
We are what we do repeatedly

It is in our nature as corporate employees and those that serve them to follow well-trodden pathways.  One of these well-trodden and expected pathways is to "train" people on new tools and methods when introducing a new project or capability.  Most people in organizations are paid handsomely for their deep experience, and that's what they deliver every day.  When forced to confront new thinking and new tools, most will demand training to assist them to provide more expertise.  However, since most innovation is "one and done", the vast majority of people don't regularly exercise their innovation skills and experiences.  Thus, training is often ineffective because the tools that are learned aren't regularly engaged in consistent, repeated innovation activities.

The complete lack of standards

Imagine a world where every automobile had a different type of engine.  Your one goal in life is to become the best auto mechanic, yet every car that drives into your shop has a different engine. Some are four cylinder gasoline engines.  Some are eight cylinder diesel engines.  Some are hybrids, some are electric, some are powered by natural gas.  In this world you'd respond by becoming a virtuoso in one type of engine, say compressed natural gas engines, or you'd hire a plethora of people who could reasonably address a wide array of engine options.  Such is the nature of innovation activity today.

Without an agreed standard, and considering the wide array of potential outcomes for innovation (incremental to disruptive, products, services, business models, experiences and channels to name only a few), there is no one way to do innovation, and so many variations as to make training impossible, except in very narrow capabilities or tools.  I suspect it's probably possible to become an expert in Voice of the Customer techniques, but this is simply one of several ways to get customer insight, which is just one of several phases of a complete innovation activity.

A completely new way of thinking

Innovators argue about the metaphor of "inside the box" thinking.  Some believe that using the concept of "inside the box" is helpful because innovation is always bounded by constraints.  Others believe that the concept of a "box" is difficult, getting outside the box helps expand possibilities and introduce adjacencies.  Innovation is enabled by specific tools (trend identification and analysis, scenario planning, customer insight generation, open innovation, idea generation, prototyping, etc) but give me a person with an open, curious and inquisitive mind and I can move the innovation world, even without any of the other tools.  A careful, cautious plodder who is deeply immersed in all of the innovation tools, who has every "certificate" known to man but cannot release the thinking bonds that constrain them is worthless on a true innovation exercise.  They are people who know everything and can apply nothing because their horizons are too small.  Good innovation requires the courage to conduct new thinking, explore new opportunities, question the status quo.  In fact that's what innovation really is, questioning why we do things the way we do, and seeking opportunities to radically reshape how and what we do, to the benefit of customers and ourselves.  If you can't think differently, all the training in the world is useless.

Born, or Made?

Now, if you are still with me, you might be thinking that I am going to make the argument that innovators are born, not made.  You'd be wrong on that point.  There is no innate innovation gene, although clearly some people have more interest in exploration and discovery.  Some people are more creative than others.  Some people are really good at dreaming up new stuff.  That's all true as far as it goes, but neglects the fact that creativity and exploration must be linked to rationalization and implementation of the good ideas in order to solve a problem for a customer and to make money.  Innovators aren't born but they are shaped, more by experience than by training.  Of course we can provide some training in any tool or technique, and try to enlarge the way people think when they encounter an innovation exercise.  But the best way to make an innovator is to give them an intractable problem and remove the constraining barriers.  Encourage them to think differently and come up with novel ideas.  And, once they've done that, do it again.  We can make innovators, but not just by training, but also through engagement.  Innovators are workers who get their hands dirty.  Does your certificate come with some washing up powder and examples of the innovations you created?  If not, you are an observer of other people's innovation, and need to do some work of your own.

Can you teach people to innovate?

The answer to this question is:  no.  You cannot teach people to innovate.  You can teach them tools and techniques like TRIZ or trend spotting.  You can teach them process methodologies that lead them from customer needs to ideas to prototypes to customer validation tests.  You can teach them to think about innovation outcomes that are more disruptive or radical than incremental change.  You can show them Doblin's Ten Types model to help them think through the potential outcomes of an innovation activity.  But until they understand that innovation is a holistic implementation of all of these factors, and requires them to release their fear, uncertainty and doubt, you are hammering jello to a wall.  It will not stick.  The wall must be removed as the knowledge is applied.

People can innovate.  What we can do is accelerate, simplify and make their innovation activities more productive and efficient through tools and techniques.  But what we cannot do is remove fear, uncertainty, corporate constraints and a lack of executive commitment.  We cannot force organizations to sustain innovation activities so the work is repeated until it becomes familiar and eventually second nature.  So the real question is: can we teach organizations and corporate cultures to innovate?  We know the answer to this is yes, but few companies have the time and patience to make the change that's necessary.
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posted by Jeffrey Phillips at 8:58 AM 0 comments

Monday, May 16, 2016

Innovation without change

I've been puzzling this over the last few weeks, trying to wrap my head around the importance of innovation generally and the lack of real innovation delivery specifically.  What I mean is that everyone knows that innovation is vital to growth and future success, but very few new innovations are created. The vast majority of innovation effort and outcome is expended on me-too, so what incremental innovations that don't really change the user or the market.

I think the main problem with innovation - real innovation, that is, the kind that creates disruptive new products or introduces new channels or business models - is that it requires change.  And there's little that corporate structures, cultures and executives fear more than change.  They don't like change that's thrust upon them, and they certainly don't like change that is created internally without an exceptionally good reason.  In fact one could argue that in many ways midsized and larger companies are completely conservative - using the definition that conservatives seek to conserve frameworks and ideas that currently exist and those from the past.  Depending on the type, scale and proposed innovation outcome, innovation can create a small amount of change or a significant amount of change, and we know how difficult change is, even in organizations that are ready to change.

Change introduces another dimension to this discussion:  the concept of reactive or proactive change.  Most organizations change in a reactive fashion, because they are forced to change because of external factors or competitive threats.  The best kind of change is proactive change, which can be carefully planned and implemented through a change management process.  This description should ring true for innovators as well.  In a nice bit of parallelism, innovation can be reactive or proactive.  When innovation is reactive, a company is playing "catch up" and has no choice but to innovate, working against its own cultural fears of change.  When innovation is proactive, the change that will spill over out of the innovation activities can be planned for and managed accordingly.

Note then that any innovation activity, no matter how small or large, has secondary and tertiary effects beyond simply creating a new product, service or business model.  Innovation creates change, which ripples throughout the organization, far beyond the intended customer targets.  The more the ripple effect, the more people are impacted, the greater the resistance, especially if the team is not prepared for the change.

Knowing all this innately if not expressly, most managers and executives wish for the impossible: innovation without change.  Most executives are expressly conservative (using the definition above), good at conserving the status quo and tinkering mostly at the edges.  Most innovation, however, is innately radical or disruptive, changing not simply the end product or service, but often having a much larger impact, causing teams to question the targeted segments, product portfolios and even business models.  No wonder most innovation comes from outside the conventional players in an industry.  Entrants have little regard for existing conventions or norms, and are interested in disrupting those norms for their own benefit, while incumbents seek to protect the industry and at best want to manage change slowly.

Here's the final analysis:  if your organization fears change, resist change or is slow to embrace change, anything other than incremental innovation will be difficult if not impossible.  This truism should cause most executives to lose a lot of sleep, because the future of business is far more dynamic and unpredictable than the recent past, and the pace of change is only accelerating.  The companies that will innovate the best are those that are open and willing to change.  Those that are focused on preserving the past had better have a very defensible position, or be in niche markets, because change is inevitable, and innovation will often be its ignition.

You may have some change without innovation.  You will have very little innovation without change.  Those that can change can innovate, but will still need skills, creativity, time and patience.  Those that cannot or will not change should not bother to innovate.
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posted by Jeffrey Phillips at 6:48 AM 0 comments