Selling Innovation to Your Boss

by Jeffrey Phillips

I've argued before that most firms innovate when faced one of two conditions: fear or greed. The fear factor indicates the firm has explored all other options, and now only the most "radical" option - innovation - remains. To paraphrase Sherlock Holmes, "when you've eliminated the possible, whatever remains, no matter how improbable, must be the answer". And, like Gordon Gecko from Wall Street, I believe many firms innovate when they believe they've spotted an emerging opportunity or new market. In this case, greed is good.

But if all innovation were based on these two drivers, then little innovation would get done. Clearly many firms latch onto innovation as a life preserver, a last ditch effort rather than a strategic focus, but there's more innovation underway than could be accounted for by desperation. And I'm relatively certain that while some firms are good at spotting innovation opportunities and moving aggressively to produce new products and services, they are fairly few and far between. That leaves us with the majority of innovation getting done by the firms in the hazy middle - not really desperate, but not really leading innovators either. If that's the case, what methods do they use to "sell" innovation to the appropriate decisioning individuals or bodies?

Innovation can be "sold" to executives in one of several methods:

1. As a method to increase organic growth, driving new profits
   
2. As a method to disrupt the existing market or adjacent markets, preempting a competitor
   
3. As a method to create significant differentiation within a market space
   
4. As a method to create product or service leadership

These are the hard-headed, rational reasons, and the reasons that organizations tell themselves they innovate. in reality, most firms take on innovation efforts because:

1. An employee created a great idea and we really have no choice but to exploit it
   
2. A competitor has launched a new (product, initiative, campaign) and we need to respond to it
   
3. A senior leader within the firm has made it his/her mission to create an innovation program and the squeaky wheel must be greased

We often find that innovation programs are formed around existing assets - people or ideas - that persist until they must be addressed. Sort of like a plant that must be weeded out or watered. Otherwise, most new innovation efforts are based on a response to what a competitor is doing. This "reactive" innovation is not, in our minds, the best way to innovate, but it may be the best way to sell an innovation program, to give your initiative the final "kickstart" needed to get the funding or resources you need.

Thus, to "sell" innovation you need to:

1. Link it to a corporate objective (growth, differentiation, disruption)
   
2. Build ideas and momentum under the covers
   
3. Demonstrate what your competitors and new market entrants are doing
   
4. Link all three together (strategy, existing momentum, competitive threats) to complete the package

Without all three "legs" of the stool, you'll struggle to gain credibility. Without a strategic linkage any innovation will be incremental point solutions. Without some existing momentum, the work will seem too overwhelming. Without the ability to demonstrate what competitors are doing, you rely on executives who place great emphasis on longer term strategic goals.


Don't miss a post - Subscribe to our RSS feed and join our Continuous Innovation group!

---

Jeffrey Phillips is a senior leader at OVO Innovation. OVO works with large distributed organizations to build innovation teams, processes and capabilities. Jeffrey is the author of "Make us more Innovative", and innovateonpurpose.blogspot.com.

Need more time for innovation (or whatever)?

How to get three hours back every day

by Matt Heinz

I need more hours in the day, and I assume you do as well. Between our personal and professional lives, there's always too much to do and not enough time to do it.

But despite these challenges, I'm constantly looking for ways to do two things:

1. Eliminate distractions
   
2. Make better use of "down time"

If you're trying to do the same, here are eight things I'd recommend trying. Collectively, I think they effectively give me back about three hours every day.

Don't drive

• We waste a lot of time in the car, driving. Except for returning a few phone calls, this isn't very productive time typically. If you can take the bus, other public transportation, or even carpool with coworkers, you can use part of that time to get caught up on other work. Catch up on email offline, brainstorm something without other distractions, and work through other things on your to-do list. Worst case, catch up on some of your reading. Any of that is better than stop-and-go traffic.

Always have something to read with you

• Everywhere you go, carry something you want to read. It can be printed materials (newspapers, magazines, printed-out articles), or it can be saved content on your SmartPhone. For example, on my iPhone I have access to my RSS feeds via Google Reader, a mobile version of ReadItLater that syncs Web articles I want to read, and also an iPhone version of Kindle software to catch up on a book I'm reading. There are so many times during the day when I'm waiting, or in a line, that can be used for a few minutes to catch up on some of this.

Avoid and cancel meetings

• Do you really need to attend every meeting on your schedule? Have you yourself scheduled meetings that can be more effectively handled with a 5-10 minute conversation in the hallway? I'd be willing to bet that 25% of your meetings this week aren't worth your time. Figure out which ones they are, and get your time back.

Keep your email offline, all the time

• If you use Outlook in particular, right-click on the icon in the lower right-hand corner of your screen and select "Work Offline". This will essentially "freeze" the email in your inbox currently, and queue up anything in your Outbox to sync when you want to. This helps you focus on what's at hand, without getting distracted in real-time by new incoming messages. Click the send/receive button when you want to, but otherwise stay more focused and more productive without the constant distractions.

Forward your phone to voicemail when you need/want to focus

• Most phones and phone systems give you the ability to point inbound calls directly to voicemail. If you need to focus on something, shouldn't you turn off this distraction as well? You don't have to do this all day. But if the project in front of you will take 30 minutes to get done, don't let things like new emails and phone calls distract you. That 30-minute project could take 60-90 minutes easy if you check email, take a call, and have to get re-engaged and focused again.

Get up earlier

• Would it really be that hard to get up 30 minutes earlier? This may not be your most productive, awake time. But an extra 30 minutes (when the rest of the house is still sleeping) could be used for reading, exercise, whatever you want. This alone gives you an extra 3.5 hours a week, and that's a lot of time.

Do your most important 1-2 tasks/projects FIRST every day (before email and voicemail)

• At the beginning of each day, you already know what 1-2 things are most important to accomplish. But most of us, before tackling those projects, check email and voicemail and quickly get distracted by the day's interruptions and fire-drills. Nine times out of ten, those distractions can wait until your most important tasks are finished. Get them done first, and I guarantee you'll feel (and be!) far more productive every day.

Delegate

• You probably aren't delegating to others actively enough. You're probably doing too much yourself, including things might be more efficient to be done by others (and sometimes with better results). You could be using a service like TimeSvr to get small tasks done by someone else. You could use eLance to outsource a variety of administrative projects. You could use ActiveWords to shortcut frequently-used activities on your computer. Long story short, you're working too hard and doing too much. Do less yourself, but get the same and more done.

Don't miss an article - Subscribe to our RSS feed and join our Continuous Innovation group!

---

Matt Heinz is principal at Heinz Marketing, a sales & marketing consulting firm helping businesses increase customers and revenue. Contact Matt at matt@heinzmarketing.com or visit www.heinzmarketing.com.

Uncertainty of Economic Growth Remains

by Steve McKee

The National Federation of Independent Business (NFIB) says that small business optimism grew slightly in January. Slightly. The NFIB Optimism Index currently sits at 89.3, ten points below where it was prior to the recession.

Commenting on the index, Lawrence Mishel, president of the Economic Policy Institute, said:


"To absorb the over 15 million officially unemployed workers in this country... job openings and hirings must rebound dramatically. This report offers no indication that this is happening."


The NFIB's report is consistent with Decision Analyst's January Economic Index, a survey of several thousand households based on nine different economic measurements. The index remained unchanged for the third month in a row, stuck at 94, well below the 110 which signals an economic expansion. This index tends to lead the U.S. economy by up to a year, suggesting the economy will remain sluggish throughout 2010.

That's what the CEO of Unilever, one of the world's largest consumer product companies, is preparing for. Speaking of the economy, Paul Polman says:


"It's not going to just drastically change in the next 12 to 24 months. We will be in for a long and slow recovery, and that's what we're planning our business on."


Policy makers continue to point the finger at the difficulty of securing business credit. But the indexes above suggest the bigger problem is simply a lack of revenue growth, meaning employers simply don't need to hire. That sentiment is borne out by the fact that fewer than one in ten owners surveyed by the NFIB added employees in January, while more than twice as many cut jobs.

Businesses don't want to borrow money as long as economic uncertainty remains high. What we most need now is normalcy, not big ideas. Let's hope the politicians are paying attention.


Enjoy this post? Subscribe to our RSS feed and join our Continuous Innovation group!

---

Steve McKee is a BusinessWeek.com columnist, marketing consultant, and author of "When Growth Stalls: How it Happens, Why You're Stuck, and What To Do About It." Learn more about him at www.WhenGrowthStalls.com and at http://twitter.com/whengrowthstall.

Welcome to 2010 - Now What?

by Steve McKee

The best thing about hope is that it springs eternal, especially at the beginning of a new year. 2009 is behind us, 2010 lies ahead and we have to believe that the coming year will be better than the last.

There is, of course, no telling. I recall in late 2008 looking forward to the calendar turning, hoping that with a new year the craziness of that fourth quarter would settle down and enable us to rebuild our economic prospects. Alas, the recession wore on. And on. The downturn has now lasted more than two years, and it simply has to be over. Doesn't it?

Time will tell. In the meantime, those of us who have any say over investment and job creation should go about our business with the intent of bringing about growth. We don't have any other choice, really - nor would we want to do anything else. As bad as last year was, we survived, and most of our companies are leaner and meaner for it. That's the silver lining.

So we get up, we go to work, we look ahead, we make decisions, we take risks. Just as we always have, and just as we always will. As I alluded to in my final FindYourNerve.com post, we are blessed to operate within the most productive, dynamic, and resilient economic system the world has ever seen. As each of us does our part, the whole will take care of itself.

Image Credit: Witness

---

Steve McKee is a BusinessWeek.com columnist, marketing consultant, and author of "When Growth Stalls: How it Happens, Why You're Stuck, and What To Do About It." Learn more about him at www.WhenGrowthStalls.com and at http://twitter.com/whengrowthstall.

The Worst Decade Ever :-)

by Steve McKee

Now that 2009 is over, I have bad news and I have good news.

First the bad news. According to the Wall Street Journal, stock performance in the decade now ended was the worst ever - worse even than the woeful 1930s. For the past ten years, the value of NYSE-traded stocks has declined by an average of 0.5 percent a year. Compare that to the 1990s, when the average annual increase was an incredible 17.6 percent.

Factor in inflation and it gets even more depressing, with the S&P 500 declining an inflation-adjusted 3.3 percent annually. During the 1930s, stocks showed an inflation-adjusted (deflation, really) annual gain of 1.8 percent. And the decade now ending saw many notable companies fall out of the S&P 500, for reasons of scandal (Countrywide, Enron), excess (Bear Stearns, Merrill Lynch, Lehman Brothers, Wachovia), misfortune (Circuit City, Lucent, Reebok) and just plain changing dynamics (AT&T, Compaq, Dow Jones & Co., Maytag, Wyeth).

Pretty discouraging, when you think about it. But here's the good news. The vast majority of American corporations found a way to move ahead during the turbulent ten years past, and all of them - all of us - are the stronger for it. We face challenges ahead, but having muddled through the most difficult decade in two centuries we'll face little that will surprise us. And those of us who have maintained our focus, kept our nerve and remained consistent throughout should profit all the more.

Here's to 2010, the dawn of a new decade. May the old one rest in peace.

[Note: Today marks the one-year anniversary of this blog. Prior to launching it last December I wondered - and worried - if I would have enough to write about. If there's any silver lining to the year now past, it's that it provided plenty of content for a blog called "When Growth Stalls." Let's hope next year is a little tougher on me.]

---

Steve McKee is a BusinessWeek.com columnist, marketing consultant, and author of "When Growth Stalls: How it Happens, Why You're Stuck, and What To Do About It." Learn more about him at www.WhenGrowthStalls.com and at http://twitter.com/whengrowthstall.

Keys to Growth for 2010

by Mike Myatt

While today's post is short, it truly merits the attention of anyone still grappling with 2010 budget concerns. I'm going to share something with you that you might not want to hear, and quite frankly, something that will likely send your CFO straight into apoplexy. You don't grow a business by shrinking it. The key to corporate growth is not to fall into decline; hopefully not by default, but certainly not by design. If your 2010 plan is one that involves constriction, contraction, shrinkage or retraction, you should note that this is not what your clients and prospects are looking for.

Do you think your clients will be impressed that you're cutting staff, shrinking marketing budgets, eliminating service lines or any other item that they perceive as a limiting factor in your ability to help or add value? Know this: your clients and prospects will never see any form of bunker mentality as being beneficial to them. One of the great business myths is the theory of "remaining flat" - it simply is not possible. A business grows or shrinks - it gains ground on competitors, or loses ground to them. So my question to you is this: What are you specifically going to do in 2010 to better serve your clients, to continue acquiring and developing talent, to build your brand, and to grow your business? General George C. Patton said it best: "Never defend, always attack."

---

Mike Myatt, is a Top CEO Coach, author of "Leadership Matters...The CEO Survival Manual", and Managing Director of N2Growth.

The Paradox of Innovation from 30,000 Feet

It's About the Journey, Not the Destination

by Robert F. Brands

In the C-suites of corporate America, innovation has become a mandate. Executives - from CEOs to marketing officers - believe that to innovate is to embrace the Holy Grail of 21st Century business.

But is innovation alone the answer? Is the end - innovation - capable of surviving solely as a mandate?

Or is innovation a process, journey that seeks a destination refined and polished along the way? "Total Innovation" is a sojourn that mandates a total approach philosophy.

However, to create the Culture, foster Ideation and sustain a focus on thoughtful New Product Development, innovation requires a complex combination of and continued adherence to imperatives that must be introduced, embraced and nurtured. Innovation imperatives must start at the top, the CEO. They must be written into the Mission Statements; "Innovation" must have the backing in the strategic plan.

To thrive, Innovation must have the support of long-term growth objectives and capital support. Beyond support, Innovation must gain Inspiration from leadership, who will create and foster a Culture of innovation and motivate the organization. Leadership must acknowledge the role of Risk, and understand the possibility and benefits of failure.

For without such inspiration and continued communication, Innovation will not survive. It will become little more than a once-promising concept left to wither on the vine of fanciful corporate initiatives that never quite took root.

Therein lies the paradox of innovation. Companies cannot succeed without innovation. Yet few executives understand how to introduce, nurture, or capitalize on the promise of innovation within the organization.

Planned well, the Imperative of Innovation can impact the New Product Development process. It can encourage fertile Ideation, welcoming input from associates to customers and users alike. It feeds the machine, providing methods of collecting, vetting, ranking and considering the Next Big Idea or future new products or processes.

The Innovation Imperative insists on Ownership and Accountability. It requires a Champions - and Chief Innovation Officer, if you will - be named to oversee teams Trained, coached and mentored to shepherd projects through the system, all the while adhering to each Imperative.

The Imperative requires Observation and Measurement of performance and results to ensure they deliver Net Result and Reward, and that they meet or remain focused upon an established set of objectives - and those involved are recognized accordingly.

Ultimately, innovation done well leads to Value Creation - for the organization, its stake holders and customers.

---

Robert F. Brands is President and founder of Brands & Company, LLC. Innovation Coach Robert Brands has launched a new site - www.RobertsRulesOfInnovation.com - to complement his upcoming book.

Creating Mobile Products by Division

by Drew Boyd

Mobility is a good thing. As mobility increases, so does our standard of living. Mobility expands job opportunities, enriches our personal life, and boosts prosperity. For nations, mobility expands trade, creates wealth, and makes countries more competitive. Mobility even helps us live longer. For hundreds of years, life expectancies hovered around 40 years. During the 1800s they began to shoot up when road transport improved. Today life expectancies in many advanced societies approach 80 years thanks to improved mobility in transportation, communications, and network computing.

How can we use structured innovation to create more of it? How can we make the products and services we use every day more mobile? For this month's LAB, we will use the Division Template. We begin by listing the product's (or service's) internal components. Then we divide one or more of the components in one of three ways:

• Functional (divide along functional roles)


• Physical (cut the product or component on any physical aspect)


• Preserving (each part preserves the characteristics of the whole)

Using Function Follows Form, we envision potential benefits of the new form and other ways to adapt the form to make it more useful. The trick is to use each type of Division with the specific intent of increasing a person's mobility. Each type of Division results in a different type of mobility. Here is how.


Functional Division

To use Functional Division, we start by listing the functions alongside the component list. In some cases, multiple components may be needed to perform one function. We imagine the function "carved" out of the total system. Then we "mobilize" it. We create access to the function away from the original product. Cellphones are perhaps the best example of that. Cellphones give us access to telephone communications away from the home or office. Mobile banking is another example. Take a look at the apps on your iPhone and you will see many examples of Functional Division. My favorite is Chord Play, and app to play guitar chords while...mobile. But notice the app itself is not a mobile guitar. Rather, just the function of playing chords has been mobilized.


Physical Division

With Physical Division, we don't just imagine carving out a component or its function. We actually cut something out along any physical dimension. For this exercise, I prefer to physically cut the function out of the original unit in a way that it can be taken with me in mobile fashion, but then returned back to the main unit at some point. Here is an example of such a product. It is from the Stout Tool Corporation. The STX-50 is a one-handed, cordless band saw. It is a mobile cutter. But snap it into place in the STX-50 Cutting Station and it becomes a traditional tabletop band saw. This product was invented by taking the core function of the original product (cutting) and making it mobile. Let's look at another example: how would we make a mobile refrigerator using Physical Division? We would have a refrigerator that would allow you to remove a compartment and take it with you. Imagine having a portable beverage container or freezer unit that lifts out of the refrigerator, allows you to keep things cool while away, then is reattached back inside the main refrigerator. I like this approach to Division because it tends to create the most novel mobile applications.


Preserving Division

A traditional way to make something mobile is to create a smaller version of the original. We make it portable. Many products fit into this category...portable chair, portable printer, portable music, portable disk drive. Without realizing it, we are using the Division Template. A six-pack of Coke Cola is a divided two litre bottle of Coke into smaller units that preserve the characteristics of the original. Going back to our refrigerator example, a small, portable cooler is a refrigerator that has been made mobile. Notice how this differs from the other refrigerator example above. In that example, we divided out an actual part of the main unit. Here, we just made a smaller main unit. This is perhaps the easiest method for creating mobile products.

---

Drew Boyd is Director of Marketing Mastery for Johnson & Johnson (Ethicon Endo-Surgery division). He is also Visiting Assistant Professor of Marketing and Innovation at the University of Cincinnati and Executive Director of the MS-Marketing program. Follow him at www.innovationinpractice.com and at http://twitter.com/drewboyd

The Importance of Consistency and Consensus

Interview - Steve McKee of "When Growth Stalls"


I had the opportunity to interview Steve McKee, the author of "When Growth Stalls" about the challenges companies face when they lose focus, lack consensus, or fail to maintain consistency with their innovation efforts. We also discuss a variety of other innovation topics including: barriers to innovation, education, and metrics.

Steve McKee is president of McKee Wallwork Cleveland, a full service marketing communications firm, is a BusinessWeek.com columnist and has been published or quoted in The New York Times, USA Today, Advertising Age, Adweek, Investor's Business Daily and The Los Angeles Times. He has appeared on CNBC, ESPN2, CNNfn, Bloomberg radio, and network television affiliates across America.

Here is the text from the interview:


1. When it comes to innovation, what is the biggest challenge that you see organizations facing?

The biggest challenge is consistency. People tend to look at innovation as an occasional thing - a lighting bolt of inspiration - rather than the result of a disciplined process. Sure, major innovations don't come along every day, but if you're not steadily on the prowl for them you'll never catch one. And not all innovations need to represent significant breakthroughs. Sometimes a small innovation in a rote process can produce tremendous benefits over time. Innovation efforts shouldn't have an on/off switch. They should be steady state.


2. Of the reasons that cause growth to stall, which is the most damaging to the organization?

They can all be damaging, but the most insidious is a lack of consensus. The reason is simple: until your management team is aligned, none of the other issues can be addressed. It's kind of like a marriage in which a couple is always fighting - about money, chores, in laws, whatever. Those are often not the real issues; the real issues deal with more fundamental things like trust and communication. You have to address the root issues first, and once you do all of the other problems can be addressed in turn.


3. Of the reasons that cause growth to stall, which is most difficult for the organization to recover from?

A loss of focus may be the toughest. If there's a commitment to finding consensus a company can usually get there, and a loss of nerve can be turned around on a dime if the circumstances are right. Inconsistency can only be overcome over time, but with a steady hand it can improve day by day. But when a company loses its focus it can face a great deal of difficulty in overcoming the consequences.

I read about a resort hotel general manager who said, "It takes two minutes to cut your rates and two years to get them back." He's right (and it might take a lot more than two years). In order to overcome a loss of focus a company may have to divest a division, trim staff, reorient its brands, or do a host of other things. It can be expensive, painful and time-consuming.


4. How do you help your organization see that it is time to switch from defense to offense?

Since you used a sports analogy, I'll continue it - you never want to play defense. That doesn't mean you don't have to sometimes, but the cliche is true: the best defense is a good offense. In business there's no reason why you can't be playing offense most of the time. When you drop the ball, recognize it and do everything you can to pick it up again right away.


5. What are some good examples of companies that you feel had their growth stall and then got it restarted?

I have to give Walmart its props. I took the company to task in When Growth Stalls for losing its focus when a few years ago it announced it was going to try to broaden its customer base. Of course, many retail analysts thought it was brilliant. I knew it was a mistake, and I'm happy to say I said so at the time in my BusinessWeek.com column.

Circumstances bore that out, and it didn't take long for Walmart to regain its focus on "people who live paycheck to paycheck." While the recession has been good to Walmart, the company isn't sitting on its hands. It's pouring billions of dollars into additional advertising, store remodels, IT infrastructure enhancements, etc. Walmart will benefit from its renewed focus for a long time to come.


6. What are some of the biggest barriers to innovation that you've seen in organizations?

One barrier is the need in modern business to measure things. Sometimes we get so preoccupied with ROI that we think if you can't measure something it's of no value. I would counter that by asking, "how much do you love your wife?" Love is impossible to quantify, but that doesn't mean it's not there - and in great supply. Anyone can paint by "the numbers," but the best leaders have wisdom and good judgment that goes beyond what can be reduced to a spreadsheet. As someone once said, "no one ever asked for a microwave oven." Or an iPod, for that matter.

Innovation efforts are not unlike venture capital investments (when you think about it, that's exactly what they are) - you're going to have a lot of flops between hits, but you can't know ahead of time when you're going to come up dry and when you're going to find a gusher. The key, as I said above, is consistency. You either believe in innovation (and put your money and time where your mouth is) or you don't.


7. What skills do you believe that managers need to acquire to succeed in an innovation-led organization?

Curiosity, of course. A desire to pioneer and break new ground. Patience. Willingness to fail. And an understanding that activity and productivity are not the same thing. I tell my staff "you gotta look up before you look down." In other words, sometimes you need to gaze at the clouds before you can reduce something to paper or proposal. Take time to think, instead of always "doing", and you'll find that your "doing" is much more productive.


8. If you were to change one thing about our educational system to better prepare students to contribute in the innovation workforce of tomorrow, what would it be?

One word: privatize. What better way to demonstrate the power and value of innovation than by having students experience its benefits in their own educational environment? We're trying to teach kids about the realities of competing in a global economy and the need for innovation, yet we're doing it in a plodding, bureaucratic, unimaginative and restrictive system. Doesn't make sense, and it's hurting the kids.


My book review of "When Growth Stalls" can be found here.

---

Braden Kelley is the editor of Blogging Innovation and founder of Business Strategy Innovation, a consultancy focusing on innovation and marketing strategy. Braden is also @innovate on Twitter.

Up or Down - Innovation and Value are Key

by Rowan Gibson

A couple of years back, when the economic barometer was pointing upward, all the talk in company boardrooms was about growth, innovation and value creation. Today, with the global economy lingering in the doldrums, corporate strategy is shifting inexorably back to the safe haven of operational efficiency. Now you might argue that this reaction is both inevitable and understandable, and I would accept that at some level. But remember this: something far deeper and more significant than these episodic upswings and downswings is the fact that we've entered a new kind of economic era - an era where cost-cutting is no longer enough. Whether it's currently an 'up' economy or a 'down' economy, we now do business in a value-based economy. And innovation is the only sustainable source of value-creation we have left.

What organizations need to understand is that, at the macro level, productivity - which of course is central to profitable economic growth - has always been determined by two elements. On one side, it is determined by the efficiency with which companies use their inputs - how much labor and capital it takes to produce their goods and services. On the other side, productivity is determined by the value that customers place on the outputs.

For most of the industrial era, the predominant focus was on efficiency as opposed to value. Yet when we look at the companies that are creating most of the new wealth today, we find that they are not doing it by eeking out the last few percentage points of efficiency from their business processes. They are doing it by creating things that bring incredible new value to customers.

Think about Apple, or BMW or Porsche. What we find is that, while these companies are highly efficient in their operations, they do not necessarily enjoy the largest economies of scale. It's their ability to deliver value - to create things that are compelling, exciting and wonderful - that has made them enormously effective engines of wealth creation. BMW and Porsche, for example, command the highest margins per vehicle in the world. Contrast this with the meager performances of GM and Ford and we find that huge economies of scale do not per se deliver an advantage. If a company is not capable of combining low operating costs on the one side with high value-creation on the other, it simply becomes incredibly efficient at making the kind of products customers don't want.

On the whole, large companies have spent about a hundred years building a 'hyper-efficiency' mindset into their organizations. But, until recent years, they have given very little thought to the other side of the productivity coin - how to build a mindset around creating 'hyper-value' for the customer. That's why innovation goes so much against the grain in most companies. It has to fight against a whole set of management principles, processes and systems that are basically set up to deliver something else.

Creating value requires a deep understanding of unarticulated customer needs. It requires enormous creativity. It requires a degree of messiness - i.e. recursive cycles of experimentation and learning. It requires radical thinking in terms product configuration or value proposition. But the industrial age has given us organizations that are not very good at doing any of that. It has given us organizations that treat variety as the enemy - that believe variance from a quality standard, or from a budget, or from a production schedule is a fundamentally bad thing. Yet creating value for the customer often entails challenging and deviating from these norms.

To use the language of complexity theory, most companies have been operating predominantly at one end of the spectrum - "the ordered regime" - and hardly at all at the other end, which scientists refer to as "the edge of chaos." It is this 'other' end - the messy, creative, experimental end - that is so vital for value creation, wealth generation and long-term growth. Indeed, in his book, "The Hacker Ethic", Pekka Himanen wrote that, in today's economy, the "most important source of productivity is creativity." This is the sort of mantra that becomes popular when the economy is growing; when companies find themselves drawn naturally toward the innovation end of the spectrum. But the big challenge comes when things take a downturn and there's pressure to cut costs again - which is exactly the situation we're in now. Organizations must ensure that the pursuit of radical, value-creating innovation does not get neglected as they pull back reflexively toward the 'ordered regime'.

As Charles Simeon, a pastor at Cambridge University in the 18th century, profoundly observed, "The truth is not in the middle, and not in one extreme, but in both extremes." The same could be said of operational efficiency and innovation. Now more than ever, organizations need to learn how to operate equally well at both extremes - they need to be both highly innovative and highly efficient at the same time. In a value-based economy, companies must be able to continually dream up products and services their customers wouldn't want to live without, yet they must simultaneously have the capacity to deliver those things with brutal efficiency.

---

Rowan Gibson is widely recognized as one of the world's leading experts on enterprise innovation. He is co-author of the bestseller "Innovation to the Core" and a much in-demand public speaker around the globe. On Twitter he is @RowanGibson.

Tenure versus Loyalty

by Mike Myatt

If your organization confuses loyalty and tenure there is trouble on the horizon. If your business highly values tenure as a measure for employee evaluation, it is time for you to consider updating your talent management practices and procedures. So, what's wrong with tenure you ask? In principle very little; but in practice virtually everything. Think of any organization that has mediocre talent, where management has frustrated you with consistent under-performance, or where cavalier attitudes and a sense of entitlement overshadow a focus on productivity and performance, and I'll show you an organization that embraces tenure.

An old business saying that sums-up my feelings about tenure goes like this:


"The only thing worse than an employee who quits and leaves is an employee who quits and stays."


You see tenure is not synonymous with loyalty, but rather is a more often a measure of compliance and survival. Ask yourself this question: Who is more loyal - an employee who has been with the company a long time but is an under-performer, or a less tenured employee who always goes the extra mile and consistently exceeds expectations? The following are the top reasons why tenure as business practice simply constitutes flawed business logic:

1.Tenure is Outdated

• In case you haven't checked your calendar lately it isn't 1950, it's almost 2010. Outside of government and academia (this should be more than enough proof that tenure is a bad thing) most people don't work for 30 years for the same employer.

2.Tenure Suppresses Talent

• Just because 'Employee A' has performed a task longer than 'Employee B' doesn't necessarily mean that 'A' is more skilled than 'B'. Furthermore, just because 'A' has been with the company longer than 'B', doesn't necessarily mean that 'A' possesses more talent, upside, knowledge, or adds more value than 'B'. When an organization promotes based upon tenure, and not based upon recognition of talent, merit, performance, etc., the company is not leveraging its true talent base. Not recognizing, developing, and rewarding talent is the fastest way I know of to drive talent out of your organization and directly into the hands of your competition.

3.Tenure Breeds Obsolescence and Mediocrity

• The sad reality is, that with very few exceptions, if you have someone on your payroll who has been with the organization in a similar role or capacity for an unusually long period of time, you likely have a mediocre employee producing mediocre work. Here's an example. Even in this day and age it is still not that uncommon to find large corporations and government agencies with IT silos built upon mainframe computing solutions. These silos are staffed with legions of 'tenured' COBOL and C++ programmers, as well as 'tenured' IT managers overseeing the operation. Walking into these organizations is often like traveling back in time 20 years. These companies have placed themselves far behind the technology curve because tenured managers hire employees with obsolete skill sets and together they create mediocre solutions.

4.Tenure Inhibits Change and Cripples Innovation

• Organizations that favor tenure also tend to be prone to majoring in the minors. The mandates for compliance along with the accompanying maze of bureaucratic processes and procedures, will often take precedence over doing the right thing. Tenured organizations also tend to embrace comfort zones and are often built upon the "DITWLY" (Did It That Way Last Year) principle. All of these traits preclude the advancement of change initiatives and cripple innovation.

5. Tenure Kills Brands

• As an organization expands and continues to promote mediocre talent up through the ranks, you'll notice that growth will eventually slow, quality and customer service suffer, and eventually these negative attributes will be reflected in declining brand equity. Think of any negative brand connotations you have, and you'll likely find an organization that embraces tenure. The Costco experience isn't what it used to be, US auto manufacturers continue to struggle, the Comcast brand has been hammered, the banking industry has been crippled, and government agencies (pick one - IRS, DMV, etc.) often evoke feelings of hatred at the mere mention of their name.

The bottom line is this...as an employer you need to possess an extreme bias toward performance. Reward talent, innovation, loyalty, attitude, creativity, work ethic, contribution, and leadership ability...not tenure.

---

Mike Myatt, is a Top CEO Coach, author of "Leadership Matters...The CEO Survival Manual", and Managing Director of N2Growth.

How many years of experience do you have?

by Mike Brown

Several years ago, an HR professional passed along a piece of wisdom warranting consideration by anyone who works: Lots of people claim twenty years experience, when what they really have is one year of experience, twenty times over.

Since that conversation, I've used her statement to gauge my career:

• What new skills, capabilities, and accomplishments have I demonstrated in the past year?


• Based on near term potential, what opportunities exist to gain new experience in the coming year?


• What can I do specifically this year to increase the likelihood I'll be developing additional valuable skills?

Ask yourself those same questions. If it looks like you've posted several years of the same experience, you owe it to yourself to take deliberate steps and correct the situation. Potential solutions?

• Work to redesign your job - formally or informally


• Step forward for new and different work assignments


• Figure out ways you'll increase your learning


• Volunteer for associations and specific roles to help grow your experience

If you haven't done this self-assessment, do it now and get to work making sure your next twelve months are materially new and different.

---

Mike Brown is an award-winning marketer and strategist with extensive experience in research, strategy, branding, and sponsorship marketing. He's a frequent keynote presenter on innovation and authors Brainzooming!

Book Review and Innovation Summary - "When Growth Stalls"

A few weeks ago I received "When Growth Stalls" by Steve McKee in the mail. "When Growth Stalls" is a relatively short, easy, and pleasant read.

The book starts by making the point from research that 54.9% of companies' growth is either currently stalled or stalled at some point in the last decade. Growth can stall for a variety of reasons including: market techtonics, the lack of consensus at the top, a loss of focus, a loss of nerve, or creation of marketing inconsistency.

When you look at the world and the findings of the research in the book, one thing stands out, and that is often companies run into trouble because executive teams either are too busy to notice or too afraid to admit that they:

• Have lost their ability to differentiate their products or services from the competition


• Have customers who don't understand the company's point of differentiation anymore


• Don't know their place in the marketplace anymore


• Have trouble making decisions


• Can't state their company's core competency in simple terms (and neither can the employees)


• Have lost clarity on who the target audience is


• Are transferring their own lack of clarity on the future direction for the company into its marketing


• Find it dangerous to take creative risks


• No longer produce marketing and advertising that captures the interest and imagination of customers


• Are not commiting sufficient resources to ensure success of market plans

In summation, as I see it: ultimately when organizations achieve success, they tend to ride the winning horse too long, fight about which horse will win the next race, or deny that a new race will be run at all.

McKee's main point is that taken together - a lack of consensus, a loss of focus, loss of nerve, and inconsistency - form a vicious cycle that can derail even the most promising growth companies of yesterday. But, once you realize you have a problem and come to terms with it, you can try to set your sights on a simple, singular, and directional "Top Box" for the entire organization to focus on. A "Top Box" is an organizational goal that is specific, time-bounded, and measurable - one that everyone in the organization can see and take tangible actions to help achieve. Your "Top Box" should ultimately be served by your marketing strategy - which could be driven by the given equation:


Top Box = I choose X


Where:

• I = The prospective customer you're trying to serve


• choose = the decision they're going to make


• X = Your brand, product or service

And to achieve your "Top Box", you have to take things back to basics. You have to define a clear "who" to target, make sure that your "what" is obviously different than everyone else's, that every part of the customer experience reinforces that differentiation (and your brand), and that your positioning is clear and consistent.

Digging deeper into positioning, Steve McKee defines five main categories of positions:

• Someone


• Something


• Somewhere


• Sometime


• Somehow

And, the position you choose must be:

• Relevant


• Believable


• Credible


• Differentiated


• Defensible

If your new market-driven positioning meets these five tests then you must be ready to move boldly in the marketplace, and start making the change real. But execution is, of course, everything so you must:

• Execute your positioning consistently across the organization


• Execute your strategy consistently over time


• Invest consistently in making your brand distinctive

So, if your company has stalled, maybe it is time to go back to basics, redefine your organizational focus, make it a living, breathing reality every day from the inside out, and then (and only then) tell people why they should believe.

So, are you ready to recommit yourself to growth?


My interview with "When Growth Stalls" author Steve McKee can be found here.

---

Braden Kelley is the editor of Blogging Innovation and founder of Business Strategy Innovation, a consultancy focusing on innovation and marketing strategy. Braden is also @innovate on Twitter.

Are you in denial?

by Rowan Gibson

Sometime over the next decade (if it hasn't happened already), your company will be challenged to change in a way for which it has no historical precedent.

Look around the world today and we see entire industries whose business models have gone belly up. The pharmaceutical industry has a fundamentally broken business model. The global grocery business has an imperiled business model. The traditional airline industry is struggling with an out-of-date business model. The insurance industry, the travel agent industry, the music industry and the movie industry have anachronistic business models. This is a situation that most companies have never faced before.

Whilst some firms may have become adept at reinventing their products and services over the years, very few organizations have any experience in completely reinventing who they are, who they are serving, how they are serving and what their industry is. They simply have no history of that kind of fundamental innovation. That's why - almost in a heartbeat - a lot of companies come unstuck. When the need for deep, fundamental change arises, most industry incumbents are simply not ready for it.

For example, was Detroit ready for the Japanese back in the 80s? Was Xerox ready for Canon? Was Coke ready for Red Bull or Starbucks? Was the BBC ready for CNN? Was Kodak ready for the digital camera - and the camera-phone? Was Microsoft ready for Linux, or Google? Was Barnes & Noble ready for Amazon? Were the world's telecom companies ready for Skype?

The burning question you therefore need to be asking yourself right now is, Will our company be ready? Will we be able to make a radical shift from where we are to where we could or should be? Have we developed a slew of promising new strategic options from which we can choose? Are we already experimenting with alternative sources of profit on which to build our company's future? Do we have the kind of people in our top management and throughout our organization who are open to these new possibilities?

In other words, are we already committing enough of our energies to deep innovation and strategic renewal? Or are we going to sit there in denial for a decade and go through some "Valley of the shadow of death" experience before we wake up and say, "Okay, maybe we have to change here?"

Don't wait till your industry has been turned on its head, your business model has been undermined, and powerful competitors - either aggressive newcomers or innovative incumbents - are already eating your lunch. Instead, you need to be thinking seriously, right now, about developing a deep capability for radical innovation and ongoing strategic renewal. It's the only way to guarantee any hope of surviving - and winning - in the new Innovation Economy.

---

Rowan Gibson is widely recognized as one of the world's leading experts on enterprise innovation. He is co-author of the bestseller "Innovation to the Core" and a much in-demand public speaker around the globe. On Twitter he is @RowanGibson.

Is there something to like about Sara Lee?

by Steve McKee

I've kept my eye on Sara Lee for several years now, originally because the company was a poster child of the Loss of Focus principle. But in 2005 new CEO Brenda Barnes introduced a plan to streamline Sara Lee, which analysts would have described as a conglomerate but could more accurately have been characterized a beast.

Launched in 1939 as C.D. Kenny Company, over the course of the next sixty-plus years the organization acquired and divested brands in industries as varied as supermarkets (Piggly Wiggly), electronics (Electrolux), apparel (Aris Isotoner, Hanes, Champion, Playtex), shoe polish (Kiwi), and even chemicals (Oxford Chemical Corporation). It took its present name from a company acquired in 1956, The Kitchens of Sara Lee.

By the early 2000s Sara Lee's strategic chickens had come home to roost in the form of slow sales growth and weak earnings. A company that had fueled growth for decades through artificial diversification had simply become too unwieldy to manage.

That's when Barnes launched (according to internal company documents) "a bold and ambitious multi-year plan to transform Sara Lee" by divesting brands comprising 40 percent of its revenues and focusing R&D efforts on food. By 2007 Sara Lee was increasing market share faster than any of its major competitors, and last month Barnes announced that she was selling Sara Lee's deodorant and skin care brands to Unilever. When asked about the rationale behind this recent move, Barnes - no doubt for the umpteenth time over the past four years - said, "Our intent is to build a great business in food and beverage." (It was a "multi-year plan," remember?)

Count me a fan. Contrary to the strategic flailing about demonstrated by many companies when they encounter rough waters, Sara Lee has kept its focus. Barnes has consistently executed on her now four year-old strategic plan, and the nearly $2 billion take she'll get from the sale to Unilever will equip her to further strengthen Sara Lee's food and beverage brands. Which will leave a good taste in the mouth of the company's investors. Smart.

---

Steve McKee is a BusinessWeek.com columnist, marketing consultant, and author of "When Growth Stalls: How it Happens, Why You're Stuck, and What To Do About It." Learn more about him at www.WhenGrowthStalls.com and at http://twitter.com/whengrowthstall.

To Multiply, You Must First Learn to Divide

by Stephen Shapiro

While in Asia, I heard a great expression, "Before You Can Multiply, You Must First Learn to Divide." I now find myself using this saying nearly every day.

The idea is that if you want to grow your business, you must learn to partner with others - and give them a slice. This means you take a smaller slice of a bigger pie.

I have been doing this for a while now with my agent. He takes a percentage of my business in exchange for handling everything from negotiating, contracting, logistics, travel, invoicing, etc. I am convinced I make more money through this arrangement...and work less.

I recently had a conversation with a guy who runs a seminar business. When big name American speakers come to his country, he hosts a public seminar. His biggest challenge is getting butts in seats. When I looked at his business model, it was flawed. He has a lot of fixed costs, like advertising, printing (brochures) and postage. His customer acquisition cost is ridiculously high, and was often hit or miss. He could spend $5,000 on a newspaper advertisement and get only three customers paying $300 each. Even with 50 paying customers, he is still paying a 33% customer acquisition cost - assuming no discounts. My suggestion was to create a model where others make money only when he makes money. One example is to set up an affiliate program where he gives a large commission to people who get him paying customers. This moves his costs from fixed to variable. This removes his risk while encouraging others to take a vested interest in his success.

Yesterday I was at a board meeting for my local National Speakers Association chapter (I was the President last year and am still on the board). Over the last two years we spent a lot of time and money on something we call the "Visibility Initiative." The idea was to get visibility for our members in order to help them get more gigs. We spent thousands on website development and marketing. If we use the "divide before multiply" concept, it would make more sense to get someone to do all of these activities for us. Speakers bureaus sell speakers to event planners. They already have the connections and already have websites. This is their business. Therefore, if we partner with a bureau (or two), they get their commission for every gig booked and we get greater results with less effort.

When I was on the Donny Deutsch show, a caller asked, "I am the owner of a business. How do I retain my top talent?" Donny asked what percentage of the business he owned. The caller said 100%. Donny's response was (paraphrasing), "Wrong. As of today you own 80%. Go into the office of your top 10 people and tell them that they are now partners in the business. Give them 2% each. They will have a greater sense of ownership. Besides, this is probably the amount you would have given them as a bonus anyway."

Where can you multiply by first dividing? Where can you give a slice of your business to someone else? How can you grow your business while creating more income for others?

---

Stephen Shapiro is the author of three books, a popular innovation speaker, and is the Chief Innovation Evangelist for Innocentive, the leader in Open Innovation.

Time to Search for New Strategic Growth Opportunities

by Rowan Gibson

It had to happen. After several years of solid growth and blue sky thinking, we now have a big, dark cloud hanging over the global economy. So what do we do next? Many
companies are likely to put the brakes on strategic growth initiatives, reasoning that money is getting too tight to invest in innovation. It's the usual knee-jerk reaction. And it's totally counterproductive. In a stalling economy, companies need to find new opportunities for pushing up revenues, not just focus on cutting costs.

Judging by all the long faces at this year's World Economic Forum in Davos, the party is definitely over (at least for a while). I may be sticking my neck out here, but I'm not entirely sure I want to join the pessimists. In the past, the mighty U.S. economy has proven to be incredibly resilient, despite all the prophets of gloom and doom. In this decade alone, America Inc. took severe beatings from the Dotcom bubble, the 9/11 attacks, and financial scandals like the Enron meltdown, yet it came back stronger than ever.

Clearly, we experienced a significant slowdown in 2008 (and so far in 2009), but I'm far from convinced that America is the new Japan, destined to spend the next decade in the economic doldrums.

When the world's dominant economic player (the U.S. accounts for 22.5% of the global economy) starts sneezing, it's obvious that everyone else panics about catching flu. But let's not forget that, taken together, Europe and Japan also account for about 25% of the global economy. And while recent stock market turbulence indicates that decoupling from the U.S. economy is still mostly wishful thinking, there remains some hope that China, India and other developing markets can somehow continue to drive global growth, even as America stalls.

Some of the world's leading companies are already a lot less interested in the U.S. market. Take Nokia. Most of the company's revenue growth is currently coming from China, Asia Pacific, Middle-East and Africa. For the Finnish mobile phone giant, North America and even Europe represent yesterday's growth opportunities. Or consider U.S. based Yum Foods, owner of the fast food chains KFC, Pizza Hut and Taco Bell. Today, 50% of the company's profits come from overseas markets where business is booming (Yum is particularly focused on China, India and Russia), compared with U.S. sales which grew by a mere 2% in 2007.

The big question is whether these emerging economies, which are still highly dependent on exports (especially to the U.S.), can continue to grow their domestic markets if consumer spending in the West - and thus demand for their products - starts to plummet. Only time will tell.

One thing's for sure: now is not the time to start mothballing your company's innovation initiatives. Innovation is not a luxury reserved for the good times. It's the mainstay of revenue growth and company value and market share and competitive advantage, whatever the state of the economy.

Recessions aren't forever - the current slowdown is likely to last maybe three or four quarters at the most, which is nothing in product development terms. When the economy returns to growth, your company needs to be ready with innovative new offerings on the marketplace with which to attract current and future customers. If you put the brakes on innovation now, you won't be able to come out swinging once growth takes off again.

To illustrate the point, do you think for a minute that a company like Apple is going to stop innovating because the economy is in a downturn? Not on your life. As Bruce Nussbaum pointed out in his BusinessWeek article, during the last recession Apple got busy working on iTunes, iPod and its retail stores. When the economic skies cleared up, Apple took off like a rocket. By the same token, hands up if you think the Chinese are going to relax their innovation efforts while America tries to get its economic act together. I don't think so, do you?

This, then, is not the time to pull the plug on innovation. If the growth rate in your industry is slowing down, what you need now more than ever is new sources of revenue - new products, new markets, new customer segments. Otherwise you'll be faced with ever-declining revenues and profits from your existing business.

The thing to do now is engage your whole organization in the search for new strategic growth opportunities - and ways to make more out of the business you already have. This doesn't call for huge innovation budgets. One of the most inexpensive methods for generating lots of new ideas is simply to ask for them. Another is to look outside your organization, and involve suppliers, partners and even customers in the search for new, value creating opportunities. This kind of 'open innovation' is what my colleague Gary Hamel would call "innovating on the cheap".

By all means, take a careful look at your innovation investments and try to manage them just as efficiently as any other in the company. But don't let innovation become the victim of a shortsighted focus on bottom line results. Instead, continue to build and maintain your company's foundation for long term growth, which is centered on its capability to innovate.

---

Rowan Gibson is a global business strategist, a bestselling author and an expert on radical innovation.

Spice Up a Long-Term Relationship

by Mike Brown

We're all likely involved in relationships tied to coaching, mentoring, or just plain supporting one another. They're tremendously helpful in personal and business growth, yet at times, these relationships can become stale.

What can you do if you find yourself in such a relationship? Here are four options to spice things up:

1. Add a Person

• I've been working out for more than three years with the same trainer. The results have been great, yet at times, we tend to fall into the same routines. When my niece was visiting last month, she went along as a guest trainee. The spirit of competition improved my effort and also created some new enthusiasm from my trainer.

2. Reverse Roles

• I've got a great career coach who can amazingly have one meeting with me that creates about nine month's worth of activity and progress. Recently we got together for lunch and turned the tables: I was able to provide some coaching for her on new possibilities she's considering. It was of benefit to her, and it was really exciting for me to give something back to someone who has done so much to help me!

3. Schedule a Reunion

• Early in my career, a group of us working as analysts for a challenging boss formed a tremendous bond as we tried to survive and figure out what we'd do with our careers. We don't get together often anymore, but we met for a happy hour recently to renew our friendship and share perspectives on what each of us is doing now.

4. Take a break

• If you find a once thriving coaching relationship has stalled, consider seeing other people. The break could be temporary or permanent, but may be just the thing to open up time to find other relationships that work better for both of you right now.

Give one or more of these a try so you can keep moving forward with renewed enthusiasm!

---

Mike Brown is an award-winning marketer and strategist with extensive experience in research, strategy, branding, and sponsorship marketing. He's a frequent keynote presenter on innovation and authors Brainzooming!

Innovation Perspectives - An Innovation Progression

This is the fifth of several 'Innovation Perspectives' articles we will publish this week from multiple authors to get different perspectives on "Where should innovation reside?" Here is the next perspective in the series:

by Mark Roser

Having consulted in the new product and innovation areas of major pharmaceutical companies and commercial transportation companies over the past 12 years, and in R&D for the 10 years prior, I have seen several variations of how innovation has been 'owned' within organizations.

The finding I would like to share is that the treatment of innovation by companies follows a progression, and as companies mature, their treatment of innovation also matures. 'How' an innovation group is owned appears to be much more important than 'where' it is owned.

For companies that consider themselves early in adopting an innovation discipline, the notion of innovation can be foreign. In order for the idea of innovation to be accepted within the organization, ownership is often centrally contained within a small group of enthusiastic souls who have stood out as having an interest in the topic; Whether they are in engineering, research, HR or an off-shoot of a quality initiative - the group tends to be isolated and on the political fringe of the organization. But, at least it is now inside the body of the organization. This is great news.

If the group remains active over the first couple of years, innovation language and approaches will spread across the organization. This diffusion of innovation language and stories within the company will be related to the number of activities that the innovation group can sponsor versus the size of the organization. For example: if the group can host a significant number of brainstorming events, idea challenges, innovation team building training, and empathic customer insight visits, then the stories from these events will spread. The larger the organization, the more active the group must be. Diffusion will also be related to the perceived success of these activities. Did an idea that was offered in a brainstorm ever survive? Did a response to an idea challenge get proper review, and did the reviewers acknowledge the submitter? Did senior leadership venture out to meet with patients or customers? The perceived success of the events will determine the tone of the conversations that result from the events.

Thus, the ownership of the innovation group is still within the small group, but the diffusion of knowledge and language of innovation has now started to foster a network of engaged colleagues. Stories get shared about innovation. The influence of the group blossoms. If the group survives, then the ownership of the activities of innovation starts to become decentralized.

As the group matures further, the question of innovation ownership within the company becomes less associated with the group, and more associated with each individual within the organization. Just as quality must be everyone’s job, and just as everyone has a stake in the company's profitability - mature companies have employees who recognize that growth is everyone's role. They also realize that it is a no-no to interfere with teams that are trying to grow new products and markets.

Ownership of innovation may still be within the same hierarchical position, but now the group defines itself as a center of excellence that helps the organization to keep pushing its own limits, growing its innovation capabilities and exploring new territory.

In summary:

• How innovation is owned is more important than where it is owned


• The networks that the innovation group establishes are critical to its success and its early success is critical to establishing viable networks


• Early in the game, innovation ownership is centered within the locus of the innovation group; in this phase, the innovation group is very active in hosting brainstorms, sponsoring research with patients and customers, developing metrics for portfolio spend on new products & new markets, developing an internal language of innovation, educating colleagues.


• Successful innovation groups find internal clients and ramp up activity, which leads to organizational awareness of innovation, acceptance of the approach and the diffusion of internal innovation lingo and success stories


• Many groups never get to a critical mass of activity to develop beyond their initial remit


• For groups that do evolve, late in the game, the ownership of innovation activity becomes decentralized, and the innovation group defines itself as owning the center of excellence for innovation knowledge and development


• With innovation being a hot topic these past few years, the role of the innovation group is to continually pilot new methods, grow its network of influence, learn from failure and support new thinking

You can check out all of the 'Innovation Perspectives' articles from the different contributing authors on "Where should innovation reside?" by clicking the link in this sentence.

---

Mark Roser has been working with companies internationally for over 12 years to identify new markets, clarify product & service growth opportunities and lead exploratory development programs. He can be reached at mark.roser*at*openinnovators.com

It's Not Too Late - What have you done this year?

by Rowan Gibson

Tom Peters once posed this question at a seminar I attended back in the early 1990s. I remember it vividly. Sitting there at one those big round tables in the ballroom at Amsterdam's Okura hotel, Tom's question connected with me like a left hook from Mike Tyson. I vigorously scribbled those words on the notepad in front of me and sat there for a few moments staring at them. What had I actually done with one whole precious year of my life? And, more to the point, what exactly was I going to do with the next one?

When I left the Okura hotel that cold December day and headed home, I made a passionate resolution: I was going to start writing the book that had long been on my mind but not on my agenda. It turned out to be one of the major turning points in my life. That book, "Rethinking the Future", became an international bestseller sold in over 20 languages and the launch pad for my public speaking career. It also gave me the great honor of working with (and getting to know) some of the smartest business thinkers of all times – luminaries like Warren Bennis, Gary Hamel, Charles Handy, John Naisbitt, Michael Porter, CK Prahalad, Peter Senge, and Alvin Toffler, among others.

As another year comes to an end, and we contemplate what lies ahead for us all in 2010, I challenge you to think about Tom's question. Sit down and write an annual report - not for your company or department, but for your own career and personal life. Doubtless you have been very busy throughout this year so far doing all kinds of... er, 'stuff'. But can you list your most 'stunning' accomplishments so far in 2009? Have you made a significant difference this year in your organization or, better yet, in your field? Have you started working on that book, or blog, or pet project, or new business you've been wanting get off the ground? Did you do something - anything - that could one day be legendary? What will your children or your grandchildren boast to their friends about you? Molly Sargent, OD consultant and trainer, asks a powerful question: "Have you invested as much this year in your career as in your car?"

Sometimes it takes an exercise like this to jolt us out of our complacency and get us to make those hefty adjustments to our careers and our lives that we know we should be making but somehow haven't yet gotten around to. So, having done the self assessment looking back at 2009 so far, the next challenge is to look ahead to 2010. What are you going to do next year that could meet the test of being truly 'Wow'? What projects, goals, values, are you going to adopt a 'fanatic's posture' toward? How exactly do you plan to make a dent in the universe?

Most people start the year with some kind of New Year's resolution. The usual suspects include "going on a diet", "joining a fitness club" or "reducing my personal debt". But how many of those resolutions ever get beyond January? How many even get off the starting block? I believe the reason so few resolutions ever go anywhere is that most of us are aiming too low. Instead of resolving to lose a few pounds before Easter (how inspiring is that?), why not aim to create an innovative new diet that will become the basis for a bestseller that will turn you into the next weight-loss guru? Instead of aiming to reduce your personal debt, why not aim to start building the business that will eventually make you completely debt-free and financially independent?

The greatest piece of advice I ever followed (which came from my friend, Al Ries) was just one single word: "focus". Make a list of all the things you will inevitably end up doing next year unless you intervene. Then make a list of what you would truly love to do, and where you would love to be. Throw the first list away and start crossing things off the second list one until you get down to just one big career-changing or life-changing goal. Then resolve to focus all your energy in 2010 on that one big thing and treat all else as secondary. Pursue your goal tenaciously as if it's the only thing worth doing for the rest of your life. View it as a grand adventure. Before I wrote one single word of Rethinking the Future, I bought myself a T-shirt and had Helen Keller's famous mantra printed in large red letters on the front: "Life is either a daring adventure, or nothing." It certainly worked for me.

Or as advertising legend Leo Burnett once put it, "When you reach for the stars you may not quite get one, but you won't come up with a handful of mud either."

If you're gutsy enough to follow your dream next year, and to work like hell to make it happen, I salute you. May 2010 bring you and your family wealth, health and happiness.

Or even better, 2009 isn't over, yet...

---

Rowan Gibson is a global business strategist, a bestselling author and an expert on radical innovation.

Five Key Characteristics of an Entrepreneur

by Matt Heinz

I briefly followed a Twitter conversation yesterday afternoon that attempted to define what a real entrepreneur is. It stemmed from one individual's frustration that some small company employees considered themselves entrepreneurs, even though they did not own or start the company.

I wonder if it matters. Furthermore, I love the idea of employees - at big companies and small - thinking of themselves like entrepreneurs.

Forget about the technical requirements of an entrepreneur for a minute. What constitutes a set of entrepreneurial attributes that employees could emulate?

1. Customer-Centric Thinking

• Successful entrepreneurs are obsessed with their customers - what they want, how they want it, and their reaction/feedback to everything big and small. Successful entrepreneurs talk to customers every day to get feedback, build relationships, and help the customers themselves help evolve and grow the business.

2. No Unnecessary Spending

• Entrepreneurial employees treat every dime as if it were their own. Do we really need those extra printouts for the trade show? Is that marketing channel really working? Is it generating not just leads but sales?

3. Creative Problem-Solving

• For entrepreneurs, there is no box, and nothing is off the table. Entrepreneurs are attempting to do something no one has done before, which requires a new way of thinking and doing. It also requires bucking the norm, the creative "control", and often going against what is known and understood. That takes guts and discipline to do day in and day out.

4. Tolerance (or Immunity) To Fear

• Fear, as I've said before, gets in the way of growth and innovation. Successful entrepreneurs know little to no fear, and certainly don't allow any element of fear to cloud their judgment, creativity or courage to achieve what they know is right.

5. Acceptance of Constructive Failure

• Smart people actually fail a LOT, in part because they try a lot of things that aren't yet proven. Not only do they try and fail often, they learn from that failure and get better - and never let that failure keep them from focusing on the ultimate goal.

If I had a company full of people who acted like this, they can call themselves entrepreneurs all day long.

---

Matt Heinz is principal at Heinz Marketing, a sales & marketing consulting firm helping businesses increase customers and revenue. Contact Matt at matt@heinzmarketing.com or visit www.heinzmarketing.com.