Thursday, August 24, 2017

You don't lack time to innovate. You lack allocation and purpose.

You'll forgive me if I lapse into a bit of consultant speak - can't help but do so since I've been in consulting for many years.  One of the factors that dictates what people do as consultants (and in other jobs or industries where time is tracked to projects or other expense categories) is the availability of charge codes.  Everyone knows that lawyers, for example, typically bill their time in 15 minute increments.  They need not only to bill their time in these time segments, but they also need a "charge code" - some mechanism to associate the time they just spent to a client, a business development activity or some overhead charge.

As consultants, most of us are no different.  Regardless of how you ultimately bill the client (time and materials, fixed fee, gain-sharing or other mechanisms) almost every consultant and consulting firm I'm aware of tracks consulting time.  I'm sure the same is true in many other industries where people are accountable for a time sheet at the end of a week or month. 

Tracking Time

In a consulting firm, where you spend your time matters, especially if you are expected to generate revenues by billing clients.  As a consultant one of your primary goals is to generate enough business to sustain your salary and overhead costs.  A second goal is develop new and interesting value propositions or skills that can provide customers with new insights and create service differentiation for yourself or your company.  In the consulting business we call this "practice development".  A third goal is business development, spending time to talk to new prospects and existing customers about new work. Finally, in every business there is some time that is simply "overhead" - filing, retrieving data, filling out time cards, doing stuff that drives the business forward but isn't billable.

As an individual with a time sheet, you are constantly evaluating your time commitments:  how much time for this customer?  How much time and effort for that customer?  How much time in business development? How much time in practice development?  Time and how it is accounted for, becomes a major consideration in everything you do.

Cobbler's Kids

Which is why even consulting firms need a charge code for innovation.  While we in the consulting industry are good at tracking and allocating time, we aren't always good about spending time innovating our own products, services and business models.  And time allocation matters - if you have a goal of being 70% chargeable, that's where your focus and emphasis will be.  Which means you'll spend more time with customers and less on business development, practice development and lastly, of course, will be innovation.  This is why even consulting firms that lead innovation efforts are often like the Cobbler's kids - they have the worst shoes.  Even those of us who talk to our customers about making time for innovation often fail to do it well.

If we, who track time so assiduously fail to define time and account for time spent on innovation, what must it be like for corporate practitioners who don't account for their time or worst, don't have specific time allocations?  As we know, innovation is very important but rarely urgent, so it frequently slips down the "to do" list until it becomes an utter necessity, at which point it becomes a "rush job".  No time allocation, no fixed expectation of time spent in innovation and an acceptance of allowing innovation to fall to the bottom of priorities mean that very little time is spent building skills to become better at innovation, let alone actually doing innovation.

What If

But what if everyone in your company had to account for their time, and what if everyone had a specific time allocation for innovation?  That might differ depending on the individual, their experience and interest in innovation of course, but what if at the end of each year you could look across your team and see how much time an individual spent building innovation skills and contributing to innovation projects.  Wouldn't that be valuable as a manager?

Wouldn't the signal that people will be expected to spend time on innovation, and that time will be managed and accounted for, send signals about the importance of innovation and the expectations that innovation must deliver results?    All too often we hear that people within corporations don't have time for innovation.  That's because they believe they are 100% allocated to their "day jobs" and can't afford distractions or time away.  What if managers and executives specifically allocated and measured time spent in innovation by individual, team and department, and set goals for each individual or group, and examined the outputs and outcome.  Do you think people would find time for innovation?  Do you think more innovation would get done?  Of course the answer to these questions is "yes".

Innovation with a purpose

But the final twist to this story isn't just that people should spend significant time, but that they should be focused on significant opportunities.  It's easy for people to commit 5% of their time to innovation and to generate really incremental ideas.  That outcome isn't really all that better than what happens today.  Beyond simply allocating and evaluating time, management teams should include specific portfolio goals - 70% of your innovation time on incremental tasks, 30% on disruptive ideas, and then measure against those goals.  If every individual or team in your company spent 5% of their time on innovation (100 hours in a 2000 hour work year) and 30% of that time was focused on disruptive innovation (30 hours per individual per year), could we expect some really new and interesting ideas?  You bet we could.

What's holding innovation back?  Time.  Time to think, time to explore, time to experiment.  And strangely, we aren't time deficient.  Most people work a 9-5 job and spend inordinate amounts of time in meetings where very little gets decided or done.  If we could reclaim even a modest amount of that time and reallocate it to more important activities, and direct those innovation activities to more interesting outcomes, the innovation most companies could create would be incredible.
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posted by Jeffrey Phillips at 6:41 AM 0 comments

Tuesday, August 15, 2017

Overcoming fixedness before being locked in amber

It seems strange to me, after working for over 12 years in innovation, that so many people can view the same set of circumstances and opportunities in so many different ways.  Our economy is awash in innovation opportunities, and the opportunities are growing and expanding.  There are opportunities to innovate new products and services, of course, but also new channels and new business models.  Customer experience is rapidly becoming an important innovation avenue.  Paul Hobcraft and I have been writing about the opportunities that are available in entire platforms and ecosystems, and these of course create in turn new opportunities.

The basic building blocks of opportunities - customers, unmet needs, emerging trends and technologies - are all growing.  Beyond that most of us have our basic needs fully met - food, clothing, shelter are all reasonably achieved.  That means that new innovations may be more intangible, psychological, emotional, notional - but there are as many opportunities there as there are in tangible innovations, if not more so.

With this opportunity abundance, why is it that so many individuals and companies see restrictions, limits and barriers to innovation, rather than the vast potential that's available if only they'd set aside past conventions and risk tolerances.  After all, this isn't a 'glass half empty, glass half full' conundrum. This is more akin to a 'glass half empty, barrel overflowing' situation.  People simply aren't paying attention, are too distracted or too fearful to really think about all the potential innovation opportunity.  Or, as I'll explore below, we give into a perspective that suggests that many issues, conventions, regulations and cultures are fixed, unable to move.

Like an insect in amber

You may be familiar with amber - the gemstone that originates from ancient tree sap that hardened over time.  The Czar of Russia had an entire room that was covered in amber - supposedly one of the most beautiful rooms in the world.  You'll often find in amber insects from long ago that were captured by the sap as it flowed down pre-historic trees.  I often think of modern business executives and their teams share similarities with those insects.  They are caught up, stuck, and have lost their freedom of movement. But unlike the insects, that loss of freedom isn't because of a tangible, sticky substance, but because of the stickiness of their perspectives, their cultures, their experiences and education and their industry conventions.  They are insects in a virtual amber, doomed to limits that are dictated and prescribed by their own thinking.

Innovation comes from outside

It may not seem evident at first, but virtually all radical and disruptive innovation originates from outside an industry's boundaries, by people who often weren't even in the industry, who were serving other clients or other needs and saw a way to serve a new set of customers or solve a new set of needs.  The reason these outsiders can so easily disrupt an existing industry is because they haven't been paying homage to the conventions and cultures that built the industry or market.  These entrants have little or no stake in how the industry or market is built or its existing business models, and in fact can profit by radically changing the business model.  These individuals, like Richard Branson or increasingly Elon Musk, are radical free agents, who aren't bound by industry conventions or past expectations, who actively look across industries for rigid decision making and adherence to past ways of doing business.

Weak links / Strong links

The other way to think about this stickiness is a "weak link/strong link" framework.  There are two perspectives: first, the linkages within the industry or convention and second the linkages between the participants.  Disruptive innovation is easier in the first example when there are few strong industry conventions or shifting from existing conventions is relatively painless for the consumer, or when everything is shifting, so the customer accepts that shifts are necessary and important.  An example is when digital music appeared via MP3s and Napster made music sharing acceptable.  Apple was able to disrupt music distribution and publishing because the form factors changed, the technology (digital versus physical media) changed and the music players themselves changed.  When multiple factors are changing, disruption is easier to accept.

Conversely we can see why it is difficult to innovate in the airline industry.  There are too many rigid, regulated or business model conditions.  Safety concerns, unions, the transparency of pricing, the reliance on key volatile inputs (oil, labor), the fixed number of gates and so on don't leave a lot of options for innovation. This means that much of the innovation needs to happen outside of the core offering, and explains why the most interesting innovation has come from outsiders (Branson for branding) or new entrants (Emirates/Qatar) for new services.  But even these innovations pale when we compare them to innovations in technology, in software and in other markets or industries where conventions or regulations are absent or easier to ignore.

What's fixed / what mutable?

So the questions a potential innovator must ask themselves in any situation is:  what's fixed, and cannot be changed?  What do competitors assume is fixed but could change?  Where are there strong linkages that would be difficult to change, and where is change already occurring that we can surf to greater success?  And, how "fixed" or transmutable is my company's culture, perspective and thinking?  Can others around me recognize opportunity and move with it?

Innovation is possible in any setting and in any industry.  Even a very heavily regulated industry such as air travel has plenty of potential for innovation if only the participants would think beyond product innovation.  In other industries that are less regulated, innovation opportunities abound.  Innovators must determine the "fixedness" of their perspectives and cultures, and then the fixedness of the industry or market they compete in.  Otherwise, like the insect swallowed by the tree sap, they'll find themselves encased, unable to move and unable to innovate.

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posted by Jeffrey Phillips at 6:19 AM 0 comments

Monday, August 07, 2017

The most innovative man in the world

For the last few years a commercial has been running to advertise Dos Equis.  In these commercials there's always some hyperbole (I know, who would of thunk it in a beer commercial) about a suave, sophisticated gentleman who can simultaneously drink Dos Equis and entertain heads of state.  He is, we are constantly reminded, the most interesting man in the world.  We are told that his mother has tattoos that say "Son" on them.  Superman has pyjamas with his face on them.  And so on.  And because he drinks Dos Equis beer, you should too.

In light of this (admittedly interesting and captivating) advertising, I thought it would be interesting to describe in the same way what the most innovative man (or woman) in the world might think, might do and how they might behave.  While the most innovative man in the world doesn't exist, wouldn't it be worthwhile to imagine what skills, attitudes, perspectives and beliefs that individual would have?  Here we go...

The most innovative man (or woman) in the world

The most innovative man or woman in the world would have to have a motto.  The most interesting man says "stay thirsty" because he's selling beer.  I believe the mantra of the most innovative man in the world would be "stay curious", because he's interested in identifying and solving interesting problems.

The most interesting man in the world, according to the ads, is almost always surrounded by supermodels and beer.  The most innovative man (or woman) in the world would be surrounded by customers and prospects, because he or she would be constantly trying to ascertain what the really interesting, unmet needs were.

The most interesting man in the world is always shown in exotic locations - skiing in the Alps or yachting in the Med.  The most innovative man or woman in the world would be found in more mundane places - research labs, startups, focus groups - always searching, always curious, open for any new insight.

One thing both share is the desire for connections, but for very different reasons.  For the most interesting man, connections are about social advancement, getting invited to the right party.  For the most innovative person, connections are about exchanging new ideas, mixing, combining and blending new ideas and experiences to create new solutions.

The most interesting man in the world has a "been there, done that" aspect, always with a wry twinkle in his eye that suggests he's done this before and knows how it will end.  The most innovative person in the world approaches every experience as if for the first time, with a Beginner's Mind approach, hoping to learn something new.

Another thing they share is the lack of conventions.  Neither are interested in following conventions but in setting new conventions, new ways of thinking.  The interesting person does it for attention and followership, the innovative person does it to disrupt markets and industries and create new solutions and value.

The most interesting person is a total insider - knows everyone, knows where the bodies are buried and his or her social capital is built on that, and on sustaining the status quo or bettering it.  The most innovative person is a near outsider - knows a lot of people in the in-crowd but also knows plenty who aren't "in".  He or she understands the social conventions and industry standards but doesn't rely on them, just as happy to subvert them as to sustain them.

Finally, the most interesting man in the world is an amalgamation - the combination of a number of stories and people combined into one fictional person.  Likewise, the most innovative person in the world is also fictional, because it takes a group of people or a team to bring an idea to full reality, and few people possess all of these traits.

 Just as no man is an island, no one person can contain all of the skills and traits to take an idea from concept to realization.  The sooner corporations understand that innovation is a team sport that requires an interesting blend of different skills and experiences, and the environment in which these teams can thrive, the sooner we'll see more interesting products and services.

The most innovative person on the planet isn't known, and probably won't be, because innovation is a team sport, where many different people bring many different skills, perspectives and experiences to bear.  Stop searching for the most innovative person and start building the right teams and placing them in cultural and business environments where they can succeed.

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posted by Jeffrey Phillips at 5:49 AM 0 comments