Optimizing Innovation - Simon Dewulf of Creax

by Braden Kelley

We are happy to bring you some of the key points and insights from Simon Dewulf's talk at the Optimizing Innovation Conference, which was held October 21-22, 2009 in New York City.

Simon Dewulf, Managing Director of Creax, spoke about how there are 67 million patents in the patent database and that a majority of them are 20+ years old and so they are free to use. And, how the other half are patents that could be applied for free to another purpose.

Simon spoke about an intersection example involving a Kraft need and a Goodyear expertise - cutting of viscous elastic material (cheese versus tires). There is no reason these two companies couldn't collaborate because they don't compete.

Amongst other things, Creax has software that helps people visualize connections and search terms from the information in the patent database. Apparently, less than 3% of patents make more money than they cost to file.


"Research is often re-search - the solution is often already existing."


In addition to companies with problems that are looking for solutions, there are also a lot of materials companies that have developed lots of solutions that are in search of a problem. This can be solved somewhat using the patent database.

Four ways of looking at your search for innovation:

1. Value and function

• What values do we want?

2. Out of the box in time and space

• What resources do we have?


• Utilizes the 9 windows method from TRIZ (surrounding, before/box/after, components)

3. Analogy across domains

• Where do we look for inspiration?

4. Variation of properties for new or improved functions

• What do we change, what do we gain?

All customer value requirements can be attributed to four main values:

• More performance


• Less harm


• More convenience (aka interface)


• Less price (aka cost)

They have simplified the TRIZ methodology down to properties and functions and brought in the patent database.


"Can you connect something that is different to something that is better?"


Finally, here are five questions you should be asking yourselves:

1. What can you achieve by changing properties?


2. What other industries should we be following?


3. Who should we be partnering with?


4. Who should be licensing to or from?


5. Why does it take so long to apply in a different domain?


• If you apply a surface similar to a golf ball to trains, you get 30% less friction.

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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.

Do Patents Hinder or Help Innovation?

by Stephen Shapiro

Some time ago I received a newsletter that had 10 wacky patents. Here's my favorite:

Apparatus for Facilitating the Birth of a Child by Centrifugal Force: With this invention, the mother-to-be is strapped down to a table that is then is spun to allow centrifugal force to take its course and aid in childbirth. This invention by a husband and wife team was patented in 1965, but surprisingly hasn't caught on in maternity wards around the country.

This raises an interesting question. Do patents help or hinder innovation?

The intent of patents was to protect those who make large investments in innovation. For example, a pharmaceutical company that spends billions of dollars on drug development and testing needs protection. Clearly these patents help innovation. No one would invest that much money if someone could come in and replicate their idea.

But what about patents that protect ideas; concepts where no real investment has been made, other than the expenditure of a few brain cells. Do these patents help or hinder innovation?

I have a patent pending for my "Innovation Personality Poker." My investment to date has been thousands, not millions of dollars. The main cost has been the design and manufacturing of the cards (and legal fees). But the patent is a process patent; it is the methodology I am protecting. Therefore, the investment I am protecting is my time. Is this really a proper use of patents?

What about patents where no investment has been made.

I have an idea that I may patent. It could save the planet through reduced landfills and reduced reliance on petroleum. My investment in this has been limited to thinking. If I pursue the patent, it might stop others from developing a similar invention. Wouldn't this stifle innovation? If this idea is so great, shouldn't we stimulate its development?

What are your thoughts? Do patents help or hinder innovation?


For more on the patent topic, check out Braden Kelley's interview with Jackie Hutter.


P.S. I will probably not patent my idea, but instead will find a manufacturer to partner with.

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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.

Is Open Innovation really cheaper?

by Jeffrey Phillips

The longer you hang around a subject, the more interesting the rumors and misperceptions. Innovation seems to spawn a number of fallacies, probably because it is very important, haphazardly performed and misunderstood by management. The combination of importance, carelessness and ignorance probably spawns a lot of fallacies. In fact, it sounds a lot like teen sex in a way.

One interesting new fallacy that seems to be making the rounds is that "open innovation" is easier and cheaper than innovation within the four walls of your organization. Open innovation can drive more ideas, and in many cases simply bypasses the bureaucracy and sloth of an organization to attract a number of people from outside the organization. In this manner open innovation can be faster, but it is not cheaper or less expensive, nor does it require fewer resources. Open innovation just shifts the costs from an innovation team, or R&D, to legal, IP and business development. If your legal, IP and business development teams have more bandwidth or lower cost than your innovation or R&D teams, perhaps this is a logical tradeoff. But don't expect open innovation to dramatically reduce the cost of innovation.

Another fallacy we see quite often is the assumption that a firm can start, and stop, innovation programs as needed or at will. While other projects may start and stop easily enough, there's enough barriers and roadblocks to make starting an innovation program difficult, and once halted almost impossible to start again. What's the biggest concern about innovation programs from those who are assigned to do the work? That is is another management "flavor of the month" program and the executives aren't serious. It is hard to start, and even harder to restart, an innovation project, and awfully easy to kill.

A third fallacy is that innovation can occur in a black box. While skunkworks can be successful, they compete for resources with other projects but can't communicate the goals and aims of the project or effort. Thus, managers have to balance how to resource a project, and what benefits or results they'll see from the innovation effort. Why would a manager provide resources to a black box project that potentially cannibalize his major product or service? We don't cut our own throats in real life, and we certainly don't do that at work. Skunkworks can work when fully resourced, all the way to product development, but innovation works best out in the open. The more visible an idea is, and the more scrutiny it receives within the comfortable confines of your organization, the more it will be shaped for the market.

The fourth fallacy is that really "good" people are important. Well, yes, people are important, but I'd rather have open-minded, collaborative volunteers than the smartest people who are assigned against their will. In fact, a good process and understanding of the tools and methods of innovation deployed by an "average" team will trump the best thinking of the best people who don't leverage the methods and processes. Clearly, as an innovation team, we'll take the best people we can get, but I'd prefer passion and the willingness to learn and use the innovation tools over people who think they already know the answer.

The fifth fallacy is that executives can demonstrate commitment by talking about innovation. Frankly, unless he or she is Walter Cronkite (a famous newsman for you younger set), executives don't communicate well, and often leave their direct reports and the people under them translating what was meant. If you want successful innovation, have your executives SHOW UP and participate in the work, and comment on the work and its outcomes, not simply state the importance of innovation. NO ONE IN YOUR ORGANIZATION KNOWS WHAT YOU MEAN BY INNOVATION ANYWAY! Demonstrate, then talk about it, rather than simply exhorting.

The last fallacy I'll talk about today is related to my recent post about new wine and old wineskins. You can't ask people to think differently and challenge the status quo, while working within the status quo and using all the existing tools and methods. New thinking requires new tools, and the ability and permission to use those new tools. Nothing is more frustrating for a team than to be told to innovate on the sly, on their own time, using old tools and methods to generate radically new ideas. Never the twain shall meet. If you want new ideas from your people, then give them the time and the tools to create the new ideas. No, demand that they take the time necessary to learn the tools and use them effectively. Otherwise, just buy ideas from consultants and save your team the headache.

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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.

Speed or IP Protection?

by Mike Myatt

While the security aspects of intellectual property ("IP") are often sacrificed for speed to market considerations in today's world of mash-ups and knock-offs, I believe when it comes to IP it is possible to have your cake and eat it too. The protection of all forms of intellectual property ("IP") should constitute common sense and require no real explanation, however the courts are littered with case law precedent that has been decisioned against some of the largest and most sophisticated companies on the planet. What should be routine business 101 protocol, can easily turn into major financial and operational debacles if you don't have a solid grasp of IP law. In today's post I'll discuss the basics of identifying and protecting your intellectual property.

The issues surrounding IP are basically three-fold:

1. What actually constitutes intellectual property and what doesn't?


2. What is the best method to protect what is deemed as IP


3. Is intellectual property worth protecting?

The answers to the aforementioned questions really lie in the eye of the beholder...Some companies take a very aggressive stance on attempting to classify virtually everything as intellectual property in an attempt to create competitive barriers and gain a competitive edge. Other firms only consider IP as it applies to protecting proprietary technology, while other firms almost ignore the concept of IP altogether (some out of ignorance and some by design).

As to cost...well sometimes protecting IP is absolutely worth the costs involved, and in other circumstances any dollars sunk into protecting IP is more akin to a frivolous investment that can actually show a strong negative return.

I have witnessed companies invest human and financial capital to adopt a trade name without doing their research only to receive a cease and desist letter, or even worse, to be sued for IP infringement. I have watched other firms invest the time and resources into protecting a piece of intellectual property via the appropriate form of registration, but not be prepared for the cost associated with defending their mark against an aggressive and better capitalized competitor.

I have observed other companies who made a valid attempt to protect their IP, but chose the wrong form of protection only to have better IP counsel exploit their flawed strategy. I have watched yet even more firms lose control over their IP to employees or contractors because they did not understand the ramifications of not using work for hire, non-compete, or non-circumvention provisions.

A company's intellectual property can be virtually anything (tangible or intangible) from a trade name, product or service name, technology, business process, marketing copy, images and the list goes on...Companies can protect their IP through the use of a variety of legal mechanisms and registrations of which the most common types include:

• Patents


• Copyright


• Trademark


• Know-how


• Trade Secret


• Mask Works


• Contract

Without going into the details surrounding all of the above protection alternatives, and to keep things simple, let's use the example of a corporate website as it applies to copyright protection (keep in mind that certain things within a website can also be patentable, trademarkable or protected by contract). A basic website is composed of a multitude of copyrightable elements including textual content, graphical content, source code, custom applications, and numerous other items.

Although as an entrepreneur or senior executive you might personally draft some of the text for your website, your internal staff or outsourced agency/contractor usually edits and refines your draft text, creates the graphics, source code and applications. Who owns what? Are you protected? Do you care?

It is important to have proper written language incorporated within your employment agreements and vendor contracts to assure your right to move your site, modify it, and not have it held hostage or taken offline. Ideally, your contracts and agreements should specify that you own the copyright for the graphics, source code, applications, etc., but at a minimum you need a license to use those materials and to create derivative works.

Lastly, in addition to cost considerations there is also the potential for financial upside to a well conceived and protected piece of intellectual property. IP can produce revenue, be carried as an asset on the balance sheet, add to corporate valuation, or produce a personal income stream to an individual that licenses IP back to the entity.

Bottom line...IP considerations should be incorporated into your business strategy and tactics in a fashion that provides you with the greatest possible benefits while managing your risk. In order to achieve the balance between risk and reward you should retain the services of a reputable IP law firm.

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

Book Review and Innovation Summary - "Conquering Innovation Fatigue"

by Braden Kelley

About a month ago I received "Conquering Innovation Fatigue - Overcoming the Barriers to Personal and Corporate Success" in the mail, a 284-page piece co-written by Jeff Lindsay, Cheryl Perkins, and Mukund Karanjikar. Now you might be thinking - Everyone is so excited about innovation, how can anyone get innovation fatigue?

Well, while most authors choose to write about the green fields or the blue oceans you can potentially create by pursuing innovation, "Conquering Innovation Fatigue" instead chooses to focus on the things that can wear down the inventor, the manager, and the innovator. The authors classify potential innovation fatigue into three main classes of innovation fatigue:

1. People Fatigue


2. Organization-Level Fatigue (Strategy, Culture, Actions)


3. External Fatigue

And then break down those classes of innovation fatigue into Nine Leading Fatigue Factors:

People Fatigue:

1. Theft of the invention and exploitation of inventors


2. Innovator deficiencies (e.g. unreasonable expectations, impatience, unhealthy pride)


3. The NIH syndrome ("Not Invented Here")

Organization Level Fatigue (Strategy, Culture, Actions):

4. Breaking the will to share (loss of cooperation from the innovation community)


5. Fundamental flaws in decision making and vision


6. Open innovation fatigue (corporate barriers to external innovation and collaboration)

External Fatigue:

7. Patent pain: barriers to intellectual property protection


8. Regulatory pain: challenges in policy, regulation, and law


9. University-industry barriers

Risk is discussed briefly in the book. As many of you may know, most companies end up focusing on small, incremental innovation because the more disruptive ideas are likely to been viewed as too risky. Smart companies don't spend all of their energy trying to de-risk every idea, but instead engage in innovation portfolio management that spreads innovation investment across ideas with different risk profiles and time horizons.

The book makes the point several times that innovation is not always fast, including a story about how it took the British Navy two centuries (200 years) to adopt the cure for scurvy. Along these lines, I'll be writing and publishing an article about slow innovation later this week.

One of the points I particularly liked in the book was the section talking about how there can be lots of logical reasons why an innovation project should not be funded or not proceed after funding. So, don't take it personally if someone wants to kill your innovation idea, instead try to anticipate as many of these logical reasons to kill it and strengthen your idea or have your rebuttals ready. Be your own devil's advocate, and deprive others of the opportunity in the process.

Breaking the Will to Share

As more and more organizations try to establish an innovation-led organization or choose to try and differentiate themselves based on innovation outcomes, nothing is more crucial than maintaining the will to share among employees and any other group that you ask to participate in your innovation efforts. The authors break down the will to share in this way:

Maintaining Trust

1. Fair, Helpful Performance Reviews


2. Rules Consistent, Fair


3. Promises Kept

Sense of Inclusion

1. Access to Insights, Results


2. Inclusion in Decision Making


3. Talents Valued, Used

Effective Incentives

1. Financial Incentives


2. Intrinsic Incentives


3. Likelihood of Impact

Innovating Beyond Innovation

There was a great call-out in the Orion Energy Systems case study about innovative reasons to believe when your innovation idea faces doubt. The point can be summarized in this quote from the book:

"Sometimes a great invention is not enough to deal with the social aspects of innovation. Further creativity is often needed to help customers change their behavior and try something new."

Innovating from the Inside Out

Finally, I'd like to agree with the authors on two important points that we all need to be more aware of as we push for increased innovation in the United States or elsewhere:

1. An incredible number of the great inventions and companies credited to discovery or formation in the United States were created by immigrants. The United States and any other country in the world hoping to start their share of innovation-led organizations, must ensure that immigration policies do not place mis-guided caps on immigration from well-educated and populous countries.


2. When comparing the potential benefit of an innovation idea, we must remember that we should not typically compare the potential benefit against some sort of continuing steady state. The absence of action will generally not lead to maintenance of the current state, but instead inaction will lead to a general decline in financial performance as competitors choose their own path of action.

Conclusion

There are a couple of great case studies in the book, an interesting framework or two, and lots of good information about intellectual property that most books on innovation don't have, making it a worthwhile reference for the layperson.

My interview with co-author Jeff Lindsay can be found here.

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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.