Part 3 of 3 - Building a Systemic Innovation Capability

Interview - Rowan Gibson of "Innovation to the Core"

I had the opportunity to interview Rowan Gibson, co-author of "Innovation to the Core" about the book and about creating a systemic innovation capability inside organizations.

Rowan Gibson is a global business strategist, a bestselling author and an expert on radical innovation. In addition to "Innovation to the Core, Rowan is author of "Rethinking The Future", and a keynote speaker at large international conferences, corporate management events and executive summits.

We have split this in-depth interview into three parts. Here is the third part of the interview:


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

The biggest barriers to innovation tend to be deep and systemic. They are embedded in a company's leadership priorities, political structures, management processes, cultural values and everyday behavior. For example, senior managers might actually be working against innovation, because the company's metrics system doesn't measure them on it, and the compensation system doesn't reward them for it, so why should they be worried about it? Or a company might be biased heavily toward its legacy business and against revolutionary new ideas that might potentially cannibalize that business. Or allocational rigidities in the budgeting process are making it difficult to get resources behind new opportunities. Or the criteria used in the company's product development stage gate process may tend to kill great ideas too early. Or the organization might simply lack people who have had any significant training in the skills and tools of innovation. These are quite familiar problems, but in every organization the barriers to innovation are subtly different, depending on factors like corporate culture, business model, organizational structure, and so forth.

To make the transition from innovation initiative to enterprise capability, an organization needs to identify, objectively, the practices, policies, and processes inside its core managerial DNA that are toxic to innovation - like traditional management processes that systematically favor perpetuation and incrementalism over new thinking and innovation. Senior executives need to realize that building a truly innovative company is not a matter of simply asking people to be more innovative; it's a matter of positively changing those things that today diminish or stunt the organization's innovation potential. As Clayton Christensen puts it, "Systemic problems require systemic solutions".


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

Managers are going to have to develop a "dual focus" - both on short-term operational performance and on long-term growth opportunities and innovation. The problem here is that these two sides of the business require very different skills. It takes a certain style of management to cut costs, restructure, reengineer, and downsize, and quite another style of management to create growth through new ideas and initiatives.

Today's senior executives will have to learn to do both - they will have to be relentlessly focused on meeting the numbers within their legacy businesses, yet equally focused on generating and successfully commercializing new growth opportunities for the future. This is very easy to talk about but very difficult to do, because efficiency and innovation don't usually "cohabit" too well - they're uncomfortable bedfellows because there's just an inherent tension between these two forces. So what this adds up to is an extremely difficult balancing act for today's managers.

I know of only one way to realign the focus and commitment of top management so that it's equally focused toward innovation, and that is to design a new set of metrics for evaluating management performance - one that puts innovation at least on a par with other performance objectives. If you think about the Balanced Scorecard inside most organizations it's actually not very balanced, in the sense that it tends to be weighted heavily toward optimization rather than innovation. So the first step is to make sure innovation is fully represented in a company's metrics. It has to be recognized to be equal in importance to operational excellence.

Companies might preach the need for risk taking and rule breaking, but these are not the metrics they typically use for measuring their managers' performance. Management compensation is typically tied to other measures like cost, efficiency, speed, and customer satisfaction - and executives are paid for making progress against those metrics. Organizations that are serious about making innovation a core competence need a new set of metrics to offset this tendency and encourage managers to put as much energy into innovation as they are currently putting into optimization.

The other thing managers need to learn is that, in an innovation-led organization, strategy-making is no longer going to be a top-down, executive-only exercise. It's something that will involve everyone in the company - and even people on the outside - and it will increasingly emerge from the bottom up. Managers must come to believe, deep down, in "innovation democracy" - the notion that ideas with billion-dollar potential can come from anyone and anywhere.

Instead of fearing that this will put them out of a job, managers should recognize their pivotal role as champions of the new innovation process. Rather than going away in a little group and trying to come up with all the new growth opportunities on their own, executives should be encouraging all of their people to think like entrepreneurs and submit new ideas. Then they need to regularly sift through the wide variety of opportunities bubbling up from below, and look for ways to invest incrementally in these opportunities. This has worked very well for Best Buy, for example, where some of the most valuable ideas in recent years have come not from top management but from line-level employees who interact with customers each and every day.

This is no doubt going to require a degree of humility on the part of top management, because it essentially means that senior executives will have to give up the old, elitist view about who is responsible for the destiny and direction of the organization, and start involving many new and different voices in the process of charting the company's future.


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?

Well, if we agree that tomorrow's economy will be an ideas economy, or a creative economy, or - as I like to call it - an innovation economy, then what does this tell us about the kind of skills tomorrow's workers are going to need? Look at the typical school curriculum. What are the kids learning? Most of it has to do with filling their heads with old information - with facts and figures - as opposed to enhancing their imagination, their ability to create or envisage new solutions.

The education system is set up to teach conformity. It punishes people who fail to stand in line, or who question authority. Yet when we look at successful innovators - like Steve Jobs or Richard Branson - we find that they tend to be rebels. They are contrarian in their thinking. They 'zig' where others 'zag'. They have somehow developed an almost reflexive ability to question the status quo, to look at things from a completely different angle of view, to imagine revolutionary new ways of doing things, to spot opportunities that others can't see, to understand the revolutionary portent in trends and discontinuities, to empathize with unmet needs, to take risks and follow dreams. Is that what schools and colleges are teaching their students to do? I don't think so. In fact, I would argue that they are systematically robbing people of their ability to think creatively.

Today's MBAs are also woefully unprepared for the new era. They may have learned how to read a balance sheet correctly, but when did they learn how to systematically discover new strategic insights, or how to come up with radical new growth opportunities, or how to recognize a really big idea when they see one, or how to rapidly reallocate resources to push ideas forward? And when did they learn how to foster the cultural and constitutional conditions inside an organization that serve as catalysts for breakthrough innovation? Let's face it, what business schools produce en masse are business administrators, not business innovators. They reward people with MBAs, not MBIs. And, again, I believe that part of the answer is to bring more balance into the student's priorities, so that they learn how to embrace the paradox between the relentless pursuit of efficiency and the restless search for radical, value-creating innovations.

Anyway, I'm glad to see that "Innovation to the Core" is increasingly being included on business school curriculums. I wanted it to be kind of a business education for the 21st century and it's gratifying to see it being used that way. The book is also playing quite a role in corporate training programs inside some of the companies that have truly recognized the innovation imperative. So if that means I'm making a meaningful contribution to advancing the field of business innovation, I'll be a happy man.


Related Articles

• Part 1 of 3 - Building a Systemic Innovation Capability


• Part 2 of 3 - Building a Systemic Innovation Capability


• "Innovation to the Core" Book Review and Innovation Summary

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

---

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.

Part 2 of 3 - Building a Systemic Innovation Capability

Interview - Rowan Gibson of "Innovation to the Core"

I had the opportunity to interview Rowan Gibson, co-author of "Innovation to the Core" about the book and about creating a systemic innovation capability inside organizations.

Rowan Gibson is a global business strategist, a bestselling author and an expert on radical innovation. In addition to "Innovation to the Core, Rowan is author of "Rethinking The Future", and a keynote speaker at large international conferences, corporate management events and executive summits.

We have split this in-depth interview into three parts. Here is the second part of the interview:


3. Innovation demand in an organization is equal in importance to innovation supply, but why don't most companies see that?

Again, it's because they are usually too focused on the front end. So they work hard to push up the supply of ideas, launching initiatives like online suggestion boxes, open innovation programs, creative competitions, and perhaps some kind of reward and recognition system. But they fail to create the necessary demand for innovation, meaning the natural, reflexive pull for new ideas within and across the businesses. Failure to drive and manage the demand side of innovation is often where the whole initiative falls flat.

I often ask companies a simple set of questions to gauge the level of innovation demand inside their organizations. For example, Do the executives who run your company's core businesses demonstrate genuine interest in radical, new ideas by redeploying adequate resources behind them? Are they held personally responsible for the performance of their unit's innovation pipeline? Do they spend a significant percentage of their time mentoring innovation projects?

One of the dilemmas today is that, in most organizations, the pressure to innovate is not very real and tangible to senior managers. If you are running one of the company's business units, for example, what is real and tangible to you is the pressure to meet the numbers - to improve operational performance - and you know you are being monitored on a monthly, weekly, daily, or even minute-by-minute basis. But there is usually no similar pressure that is holding you directly accountable for innovation performance. So your natural bias is to worry a lot more about efficiency, and short-term earnings, and monthly variances from budget, than about the innovation performance of your business unit.

The challenge, therefore, is to create a whole set of pressure points on the demand side that will make leaders as sensitive and responsive to the need to innovate as they are to the need to make the numbers. For example, companies can give senior managers unreasonably high growth targets that call for innovative ways to dramatically outperform the average; they can force their senior managers to allocate a portion of their budget to fostering innovation projects; and they can link a sizeable part of executive compensation directly to innovation performance. These are the kinds of measures GE has taken to drive innovation demand across the organization, and it has produced impressive results because GE is a company where managers are fanatic about achieving their goals.


4. Since the book was published, have you come across other organizations that you think are doing systemic innovation really well?

When we were writing the book, we devoted quite a lot of ink to companies like Whirlpool, P&G, IBM, GE, Shell, W.L. Gore, and Cemex. These are all excellent examples. Since then, of course, I've been working with all sorts of other organizations to embed innovation as a systemic capability. They include pharmaceuticals giants like Bayer and Roche: tech champions like Microsoft and Nokia: financial services leaders like Generali Group; massive consulting firms like Accenture; manufacturing companies like Rexam, top automobile brands like Volkswagen; trend-setting retailers like Ahold and Metro; home appliance makers like Philips and Haier; even heavy engineering firms like Debswana diamond mining. For the last half-year, I've also been very busy with Mars - the global manufacturer of chocolate, pet food and other food products - and I've seen a lot of progress there, too.

What really satisfies me is to see companies like these gradually institutionalizing and managing innovation as a discipline. So some of them are setting up innovation directors, innovation boards, business unit innovation officers, and innovation ambassadors. They are introducing comprehensive new metrics to measure their innovation performance. They are building new processes to produce and nurture a continuous stream of innovation opportunities from inside and outside the organization, as well as robust innovation pipelines for taking ideas from mind to market. They are giving their people new tools - including the "Four Lenses" methodology and web-based innovation platforms - that open up the innovation process to everyone. They are training literally thousands of their employees to use these skills and tools, and setting up incentive schemes and reward ceremonies to encourage them to innovate every day. They are hardwiring all their HR systems - pay, spot awards, the long-term incentive plan, the balanced score card objectives - into the company's innovation strategy. They are creating new cultural mechanisms, such as a discretionary time allowance, to foster and support innovators throughout their ranks. They are building dedicated innovation spaces where their people can ideate together. And they are working hard to make innovation a tangible corporate value, rather than just an aspiration.

There are few other companies, too - ones that I have not yet personally worked with - that I would point to as good examples of systemic innovation. They include Best Buy and McDonald's in the USA, and Tata in India. In fact, there's a rapidly growing list of organizations around the world that seem to be gaining traction with the innovation management challenge, and what they demonstrate is that large companies really can tackle innovation successfully in a broad-based and highly systemic way.


5. People often talk about not having time to innovate. How can people find the time for themselves or their employees?

This is such an important issue. When we asked more than five hundred senior and midlevel managers in large U.S. companies to identify the biggest barriers to innovation in their respective organizations, one of the most common responses was "lack of time." Most of us are struggling simply to get through the day, and it's almost impossible to think creatively, reflect on new strategic insights and innovate in a focused manner when you're running from one meeting to the next, making loads of phone calls, writing a thousand emails and frantically trying to work through all the other tasks on your to-do list. So companies need to think seriously about freeing up more time, energy, and brainpower across the organization to devote to innovation and growth.

The fact is, none of us are going to "find" time for innovation. We are going to have to "make" time for it by driving a wedge into our agendas and turning innovation it one of our strategic priorities. In the book we say that carving out time for employees to imagine and experiment and develop their own ideas is the "first commandment of innovation". For some companies, a discretionary time allowance seems to work quite successfully. Well-known examples would be 3M, Gore and Google, where employees can spend a percentage of their time on pet projects. Other organizations take a number of people out of their day jobs for a certain period - say, a few weeks or months - and let them concentrate on generating new insights and ideas as members of dedicated innovation teams. Here, I'm thinking of companies like Whirlpool and Cemex. In addition, Whirlpool also has a formal training program where people are given time to learn the principles, skills, and tools of innovation in the same way as they learnt Six Sigma. Then there's the example of Shell, where the time allowance actually comes after a person or team has submitted an idea, and these people are given one or two months, rising to perhaps a whole year, to design some small-scale, low-cost experiments to test the validity of their new business concepts.

The other thing to remember, as I have been emphasizing all along, is that creating bandwidth for innovation is not just about the front end. It also has to do with freeing up top management time for the back end of innovation - time to devote to steering innovation activities, reviewing ongoing innovation projects, setting priorities, allocating resources, mentoring innovators and embedding innovation as a core competence. And making innovation stick requires a significant number of people - outside of R&D and new product development - who officially work on a full- or part-time basis on innovation activities. One global company has already appointed 1,200 part-time innovation mentors along with 50 full-time innovation consultants, who coach and support would-be innovators throughout the organization, helping them push their ideas forward.


Related Articles

• Part 1 of 3 - Building a Systemic Innovation Capability


• Part 3 of 3 - Building a Systemic Innovation Capability


• "Innovation to the Core" Book Review and Innovation Summary

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

---

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.

Part 1 of 3 - Building a Systemic Innovation Capability

Interview - Rowan Gibson of "Innovation to the Core"

I had the opportunity to interview Rowan Gibson, co-author of "Innovation to the Core" about the book and about creating a systemic innovation capability inside organizations.

Rowan Gibson is a global business strategist, a bestselling author and an expert on radical innovation. In addition to "Innovation to the Core", Rowan is author of "Rethinking The Future", and a keynote speaker at large international conferences, corporate management events and executive summits.

We have split this in-depth interview into three parts. Here is the first part of the interview:


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

The biggest challenge is not generating new ideas and opportunities. It's how to make innovation a deeply embedded capability. What usually happens is that companies focus most of their efforts on the front end of innovation - so they launch some kind of ideation initiative with a lot of hoopla and they get a whole bunch of ideas. But then they hit a wall because there is no back end - there is no organizational system for effectively screening ideas, aligning them with the business strategy, allocating seed funding and management resources, and guiding a mixed portfolio of opportunities through the pipeline toward commercialization. So, invariably, what we find is that the whole innovation effort eventually withers. And all those enthusiastic innovators inside and outside the company become cynical and discouraged as they watch their ideas go nowhere.

The real challenge, therefore, is to turn innovation from a buzzword into a systemic and widely distributed capability. It has to be woven into the everyday fabric of the company just like any other organizational capability, such as quality, or supply chain management, or customer service. In other words, for innovation to really work, and to be sustainable, it has to become a way of life for the organization. Yet how many companies have actually achieved that? The sad truth is this: most organizations today still have absolutely no model, no practical notion, of what the back end of innovation actually looks like. If you asked them to build a corporate innovation system that seamlessly integrates leadership commitment, infrastructure, processes, tools, talent development, cultural mechanisms and values, they wouldn't even know where to start. That's the challenge Innovation to the Core was meant to address.


2. Why is it so important that organizations build a foundation of insights before generating ideas?

OK, let's go back to the front end of innovation. If you're going to do this properly, what you're really looking for is not just a lot of ideas. Senior managers often complain that most of the ideas they get from their employees and customers are not very good ones. So after they open up the innovation process to everyone, everywhere, they find themselves wasting valuable management time sorting through a heap of garbage to find a few interesting submissions. That's because, frankly, they don't really understand how the innovation process actually works.

Try to look at it this way: before you start building a house, you have to gather the right materials and lay a solid foundation, right? Remember the story of the three little pigs? If you build a house from the wrong materials it can easily be blown down, so it's useless. Then there's the Bible story of the house built on sand rather than rock. It makes a similar point: if you don't have the right foundation - regardless of the quality of the building materials - the house is equally useless. So it is with new ideas and opportunities. In a sense, they need to be built from the right "materials" and they need a solid "foundation", otherwise they won't be very good. What I'm getting at here is that there is actually a front end to the front end of innovation. Before you start ideating, you need a set of really novel strategic insights. These are like the raw material out of which exciting innovation breakthroughs are built. If you ask people to innovate in a game-changing way without first building a foundation of novel strategic insights, you find that it's mostly a waste of time. You get a lot of ideas that are either not new at all, or so crazy that they're way out in space.

So how do you develop those all-important insights? I teach companies a methodology for doing that in a systematic way - it's called "The Four Lenses of Innovation". The fact is that in order to discover new ideas and opportunities of any real value, people need to stretch their thinking beyond the conventional. They need to develop fresh perspectives. So the "Four Lenses" represent four specific types of perspectives, or ways of looking at the world, that innovators typically use to come to their breakthrough discoveries. They are (1) Challenging orthodoxies, (2) Harnessing trends, (3) Leveraging resources in new ways, and (4) Understanding unmet needs. By using these lenses, or these particular angles of view, it's possible to systematically look through the familiar and spot the unseen. That's how you discover those deep insights that others have overlooked or ignored.

Once you have gathered a collection of really inspiring insights, you can then do your ideation work. You start thinking about what kinds of ideas and opportunities could be built on these unexamined dogma, unexploited trends, underutilized resources, and unvoiced customer needs. And what that gives you is not just a high quantity of ideas but also a high quality. Rather than just pulling ideas out of the air, you generate opportunities that are grounded. They are based on real industry orthodoxies that deserved to be challenged, real discontinuities that could potentially reshape the business landscape, real competencies and assets that could be leveraged to create opportunities beyond the boundaries of the existing business, and real customer needs that have not yet been addressed. So you inspire ideas that are connected to the real world; they are not in some crazy, unbounded creative space. They are founded on realities - things you can test and validate.

Now imagine that instead of merely inviting everyone, everywhere to "go forth and innovate", you actually gave them access to these powerful strategic insights via a web-based tool, and you taught them how to ideate effectively. Can you see how that would dramatically enhance their innovation performance? That's what I'm currently doing with all kinds of organizations around the world.


Related Articles

• Part 2 of 3 - Building a Systemic Innovation Capability


• Part 3 of 3 - Building a Systemic Innovation Capability


• "Innovation to the Core" Book Review and Innovation Summary

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

---

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.

Having Fun with Innovation

Interview - Scott Christopher of "The Levity Effect"

I had the opportunity to interview Scott Christopher, co-author of "The Levity Effect" about the importance of fun in the workplace, and about how beneficial it can be. But how important is fun to innovation?

A contributing author of the bestseller "A Carrot A Day", a regular columnist for Workplace HR and Safety magazines and a distinguished consultant on recognition, Scott travels the world speaking to leadership groups at conferences, conventions, and on-site customer meetings.

Here is the text from the interview:

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

Boss-employee relationships. Look, all the truly useful, great ideas come from the workforce because they're the ones that have identified a need and can actually see themselves implementing them. An engaged employee is ten times more likely to contribute his or her time, effort and energies into innovation, but too many managers are missing the engagement boat. They simply assume that, particularly in a rough economy, a paycheck is all the incentive people need to work harder and better while still devising ways to improve the company.


2. Why is it so important that organizations teach their leaders to embrace fun more?

Thanks for asking that because it beautifully wraps up the incomplete response above. Easing the tension and pressure with levity is fundamental to getting the most from your people. Studies show that there is a direct correlation between being physically relaxed and motor skill acuity, task completion, team interaction, idea generation, creativity, and the list goes on and on. You don't have to look much further than a high school basketball coach who reminds his players to "have fun out there guys!" If they're tense and nervous, they simply won't be at their best. It's usually the team who "has nothing to lose" that ends up shooting lights out from all over the floor, while the top-ranked Bulldogs, for example, feel the pressure of all the expectations and suddenly forget how to make a simple layup or pass the ball out of bounds.

There is also just too much evidence to ignore that humor and fun at work are no longer optional, but critical to building a satisfying, engaging workplace which drives performance.


3. Why do some people fight against fun in the workplace?

Because there is a stigma associated with levity - it's inappropriate in a professional work environment. Plus, the fear that somehow everyone with a lifelong yearning to be the next Jim Carrey or worse, Don Wrickles, will suddenly rear their ugly, obnoxious heads and you'll have an office filled with offensive, discriminating jokes courtesy of a new army of Michael Scott clones. A lack of credibility is often associated with levity, which is patently erroneous. Many of the world's greatest leaders had and have wonderful senses of humor. Even Mahatma Gandhi once said, "If I didn't have a sense of humor I would have committed suicide long ago." You remember when Bob Dole lost the 1996 presidential election? His whole image was serious. His monotone delivery, his grave responses, his reputation as a wounded war veteran all shaped his image to voters. After he lost, he was on Leno and Letterman laughing at himself and displaying an uncanny and often hilarious sense of humor. Where was that during the campaign? Fear of not being taken seriously, evidently, was his reason for choosing to only display one side of his whole persona. Too bad, he might have won if people had seen the real Bob - credible, courageous, appropriately serious, experienced, AND able to laugh and joke a little.


4. What most impedes organizations from having fun?

Probably the misconception that it's going to take a lot of time and planning and that no one's going to like it anyway, so what's the point? Lightening up at work begins and ends with the individual. It's just a simple shift in your personal paradigm. Smile more, laugh more, unfurrow your brown, unclench your jaws, keep perspective and be the same person at work that you are at home or golfing or at church. Having said that, it can only help to "program" some levity into your department or team. Plan a couple of parties or an offsite outing. Celebrate birthdays. Go see a Friday movie premiere. Go bowling during lunch. There are of course a million ways to have some fun at work, but ultimately just allowing people to be themselves and laugh more and enjoy a good Youtube video now and then is the least complicated or time-consuming way to getting there.


5. Since the book was published, have you come across other organizations that have transformed their organizations to be more fun?

Absolutely. There are levity champions tucked away in cubicles and offices all across the globe and when they read the book it arms them with the validation they've been seeking to take it up the chain. And then they usually have me come in and speak to their leadership group or even the entire company to underscore the company's determination to "lighten things up around here." It's not an overnight cure, by the way. As with any organizational change, it requires time and effort. Many companies have adopted 'fun' or 'sense of humor' as one of their core values or guiding principles, which instantly legitimizes it and can speed up the transition. Levity's effect is not easily quantifiable, but the results are usually evident in things like engagement scores, employee retention, and customer satisfaction.


6. What advice to you have for managers who work in an organization that doesn't have fun?

Buy the book!... and make a personal, confidential goal to commit to the levity concepts for one year. Keep a journal or log of your efforts and what you perceive to be the results, either immediate or long term. Describe in as much detail the current state of your team to compare against later. You will likely not get through the first few months before your work is noticed and possible opportunities to broaden your goal to others become evident. By the end of the year compare and contrast your relationship with your employees, morale, productivity, and financial goals with your starting point. It may take the whole year, but you should have observed tangible, meaningful changes to keep you committed to levity's path.


7. What advice to you have for employees who work in an organization that doesn't have fun?

First, make an issue of it, but don't overdo it. At least let it be known that "gee, we don't have much fun around here." Or "we should laugh more." This may even include a comment about it to your boss in a review or even just shooting the breeze (if that's allowed.) Second, create your own fun. You can still develop and exercise your unique sense of humor and have fun on your own. You don't need permission, or at least you shouldn't, to have a smile on your face, a look of mirth in your eyes and an itchy laughter trigger finger. Re-record your voicemail greetings - put a smile on your face or make yourself laugh right before you record... people will hear levity in your voice. Make your email "voice" a little less formal, maybe subtly change a font, color, or signature. Humanize the copy some; write like you talk. Listen to your favorite comic on satellite radio or your Ipod on the way into work. Get laughing in the car and share one of the jokes with the first person you greet at work.


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?

A comfy place to nap.


Be sure and check out our review of "The Levity Effect" and summary of the main innovation points here.


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

---

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.

Video Interview - Eric Liu - "Imagination First"

by Braden Kelley

I had the opportunity to interview Eric Liu, author of the new book "Imagination First" at a book event last night. I'd like to share a video interview I did with Eric before the event:



Interview - Eric Liu - Author "Imagination First" from Braden Kelley on Vimeo.


If you prefer YouTube, I've split the interview into Part 1 and Part 2 there.

Eric Liu was interviewed on stage during the event by Warren Etheredge and I'd also like to share some of the key insights from Eric's talk at the event:

• We all have the capacity for imagination, but as we grow up we are disincentivized to share it


• We need to teach kids to have respect for limits and to stretch their imaginations by giving them activities with limits and inviting them to create within those limits


• We need to be careful not to strip out the play from education


• "Play matters" - leaning forward versus leaning back


• We should practice imagination in the same way that we practice music, sports, etc.


• There are two main enemies of imagination


1. Expert Knowledge (we know it already)
   
2. Fear (of succcess, of being exposed, etc.)


• How do we sustain imagination in our little pocket of the organization and then how do we infect others with it?


• Next time something bad happens, try saying out loud "How fascinating!", then allow yourself to detach and observe as you work toward a solution instead of getting stuck in a fear loop.


• We want innovation right now, but you don't get the fruit without first planting the seed


• We need to make education speak to students' and teachers' motivations - More "what if?" and less "what is" - More project-based learning


• Out of all of the practices in the book, the most important one is "Failing Well"


• We must learn to fail better each time
  
• True with entrepreneurs
  
• True with politics


• There is an art to failing


• Failure is the real "f" word in our society

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

---

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.

Balancing Intuition with Analysis

Interview - Roger Martin of "The Design of Business"


I had the opportunity to interview Roger Martin, the author of "The Design of Business" about the challenges companies face when they fail to balance analytical thinking with intuitive thinking. We also discuss a variety of other innovation topics including: barriers to innovation, education, and risk taking.

Roger Martin has served as Dean of the Rotman School of Management since 1998. He is an advisor on strategy to the CEO's of several major global corporations. He writes extensively on design and is a regular columnist for BusinessWeek.com's Innovation and Design Channel. He is also a regular contributor to Washington Post's On Leadership blog and to Financial Times' Judgment Call column. He has published several books, including: "The Design of Business" and "The Opposable Mind".

Here is the text from the interview:


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

It is the dominance of analytical thinking which holds that unless something can be proven by way of deductive or inductive logic, it is not worthy of consideration or investment. No new idea in the world has been proven before being tried. So as long as analytical thinking is allowed to dominate, innovation is deeply and profoundly challenged.


2. Why is it so important that organizations teach their leaders to be design thinkers?

Design thinkers are capable of balancing the inductive and deductive logic of analytical thinking with the abductive logic of intuitive thinking. So they are capable of both honing and refining the past and inventing the future. Thus they can overcome the innovation challenge. Without design thinking leaders, an organization is likely to slowly but surely stultify - like most large corporations over time.


3. Why is it so hard for hard for managers to take valid risks?

Two main reasons. First, they live in cultures that value only analytical thinking. And second, they get Stockholm syndrome and begin to believe that is right. First they get dissuaded from innovating by others, then they dissuade themselves.


4. What most impedes the risk-taking necessary for innovation?

The problem is processes that imbed requirements for proof through inductive or deductive logic. And then the culture that this breeds.


5. Since the book was published, have you come across other leaders that have transformed their organizations to take more of a design approach?

Leaders from two of the world's largest companies read the book and both have asked me to help them transform their organizations to take a design thinking approach. So far, so good. They are very committed.


6. People often talk about not having time to innovate. How can people find the time for themselves or their employees?

That is a lame argument. People have time to do anything for which they are passionate. People blame lack of time for every single thing that they think they would like to do but lack the sufficient passion for. Innovators innovate regardless of their environment. Some get fired for it and go somewhere else and start over again. A leader can make it harder or easier for employees to innovate. But the innovators innovate regardless and the non-innovators complain about the difficulty finding the time to innovate - regardless.


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

They need to nurture their originality. Very few people in life are good at anything without practice. If you practice mastery all your life, you will be masterful. If you practice originality, you will get good at innovation. Most managers spend their time deepening their mastery and not nurturing their originality. Over time, they become fearful of innovation.


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?

Make art a required subject for as long as we make math a required subject. We send a powerful signal to students that analytics are important and artistry is not. Artistry is the foundation of innovation. Most technologists will never innovate a single thing because their training drove out any artistry from them.


My book review of "The Design of Business" 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.

Video Interview - Dan Pink - Author of "Drive"

by Braden Kelley

I had the opportunity to interview Dan Pink, author of the new book "Drive" at a biznik event last night. If you're not familiar with biznik, it is an online community for entreprenurs and the independently employed. Instead of just stopping there, Biznik organizes several in-person events and an annual conference called Seattle BizJam (which I spoke at in 2007), and allows members to organize their own free or fee-supported events. I think Biznik is great and they are headquartered here in Seattle.





Dan Pink was interviewed on stage during the event by Warren Etheredge and some of the highlights from my tweets last night included:

• "A good book is a basket of ideas that is refined and spread through conversation."


• People are more likely to donate blood for altruistic reasons than for cash. Offering people money moves things from the social realm to the economic realm and behaviors and expectations change. Same is true when you begin imposing a fine on parents picking their kids up late from day care instead of people feeling obligated to be there on time.


• There is great absurdity in how open source developed if you look at it in terms of economic motivation, but the mastery drive is so strong that people participated (even without an economic incentive).


• Even though biznik has an even male-female split, more women turn up for the in-person events than men.


• People who sculpt their jobs to broaden them beyond narrow responsibilities, find more autonomy and job satisfaction.


• "Annual performance reviews are dumb. People need more frequent feedback. Imagine professional athletes only getting feedback on their performance only once a year."


• The carrot-stick approach is the wrong approach when it comes to creative, thoughtful work - non-algorithmic work.


• Using the carrot-stick approach with teachers or students is wrong. Dan Pink's solution for the education problem would be to raise teacher base pay and make it easier to get rid of bad ones.

---

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.

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.

Influencing Your Innovation Potential

Interview - Steve Todd of "Innovate with Influence"



I have the pleasure of knowing Steve Todd (the Rockette on the left), a Distinguished Engineer for EMC Corporation with a hand in generating over 140 patent applications and billions of dollars in revenue. Steve has a great sense of humor and is the author of "Innovate with Influence - tales of a high-tech intrapreneur" - a new book that tells the story of his intrapreneurial adventures and quest for innovation. I had the opportunity to interview Steve about innovation, influence, and needs of the innovation workforce.


Here is the text from the interview:

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

Some organizations struggle to identify and tap into the expertise that exists outside of their organizations. Individual employees are at their innovative best when they can learn and collaborate outside of their own teams. Unfortunately, the working reality for many employees is to focus on productivity solely within their business unit. Corporations can help by encouraging employees to lift their heads up and explore new areas of interest. Ultimately, however, it's up to the employee to take a few risks of their own.


2. Any other tips you have for innovators on how to build their influence?

My quick tip for innovation is an easy-to-remember mathematical equation: Innovation = Productivity + Initiative + Collaboration. Always be productive on whatever tasks you are given. Get them done early and then take the initiative to learn something new. During your learning process, seek out experts and collaborate with them on new ideas.


3. What are some of your favorite tips for limiting your meeting participation?

I typically don't bring my laptop (or any other device that is web-enabled) to any meeting. I do this to give my full attention and engagement to the topic at hand. If I am tempted to bring my laptop, this means that I'm not very interested in the topic, or that I have more productive ways to spend my time. In this case I will double-check the agenda with the meeting organizer, and often ask them to post their agenda on an internal forum and add my comments in lieu of attending. If I can't wiggle out of a questionable meeting, I will attend remotely, set my phone on mute, and get some work done in parallel.


4. Do you have suggestions for effective cross-border virtual collaboration?

I use my corporation's social media toolset (known as EMC ONE) and shy away from corporate email. I've been working with St. Petersburg, Russia and Shanghai, China on some new product ideas, and I always attempt to make those conversations public. Somebody else in the world is always interested and has a unique perspective that can only be brought to the table using EMC's intranet. Since I work in EMC's Corporate Headquarters (Massachusetts, USA), I will usually try to entrust project ownership of the collaboration to my foreign co-workers. They like nothing better than to deliver something that they dreamed up in the initial stages.


5. Do you ever feel that you've limited your influence by limiting your executive visibility?

No. I'm in my third decade of delivering innovation and my lack of executive visibility has rarely limited my influence. I rely on building strongs bonds between my manager and his/her superior. THEY are the ones that have executive visibility; my team and I are the ones that deliver the end result to the customer. If this "chain of three" (myself, my manager, and his/her superior) are united in building an idea that brings great value to a customer, then selling an executive on a new idea is fairly straightforward.


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

The biggest barrier to innovation is the relegation of research into "ivory towers". Large corporations that sponsor dedicated "innovation centers" are often removed from the pain of customer problems. Ideas that flow out of a research center are often rejected by the developers in the trenches. Everyone has the passion to create. Innovation expectations should not be limited to people that work in a specific research facility.


7. 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?

I would encourage teachers to search out opportunities for global student collaboration. Partner with students in China, Russia, South America, etc. Students are used to this type of dialog with their friends; get them used to doing it in the classroom. Focus on world-wide issues that are important to our times, and encourage the students to propose their own ideas to their global peers. Students will quickly realize that they cannot innovate to the fullest in the workforce of the future unless they participate in global collaboration.


My book review of "Innovate with Influence" 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 Playing Offense or Defense?

Interview - Bill George of "7 Lessons for Leading in Crisis"


I had the opportunity to meet Bill George at the World business Forum and later interview him. He is the author of "7 Lessons for Leading in Crisis", and a professor of management practice at Harvard Business School, where he has taught leadership since 2004. Bill George is the author of three other best-selling books, and the former Chairman and Chief Executive Officer of Medtronic. I interviewed him about social media, the recession, offense vs. defense, leadership, and needs of the innovation workforce.

Here is the text from the interview:


1. Do you think that CEO's and other corporate leaders should be participating in the social media conversation on Twitter?

I actually wrote a blog on this very subject last month (Extra, Extra, Tweet All About It). Just as it's important for CEOs to read the newspaper and watch TV to remain current with customers and trends, it is equally important for CEOs to participate in social media, particularly Twitter. In no other forum can you be the spokes of a potentially very large, real-time communication wheel - this can be very useful in assessing one's standing in the marketplace. On Twitter, CEOs can have unfiltered access to customer opinion, engage with customers and other CEOs, respond to questions, and further build their personal brand and promote their company.

However, there is one caveat every CEO should keep in mind: You cannot join Twitter just to say that you are "on Twitter." From my limited experience (I've been on since August), I've learned that engagement is crucial to getting the true informational and relational benefit of the service. If you don't devote sufficient time and energy, others will see right through you and the entire operation will be a waste of time. The long and short of it is: The world of social media is the new marketing and communication standard. CEOs would be wise to keep pace.


2. Any tips for people having trouble facing their reality?

Be open to criticism. In fact, go looking for it. If you are truly having difficulty facing your reality, ask your support network - your internal management team, your family, your friends - to help face it with you. "Facing reality, starting with yourself" is the first step in my latest book "7 lessons for Leading in Crisis", and I find that this step is the most difficult, particularly for veteran leaders with well-defined egos and track records of success.

A good rule of thumb for any leader: Whenever your company falls into the depths of crisis, automatically acknowledge partial fault or involvement. This is because under every conceivable circumstance, as the leader you had a hand in a creating the crisis. This does not mean accepting all the blame and putting the weight of the world on your shoulders, it's just a good starting point. Concede the need for improvement, and that mindset will aid in your finding exactly where you fell short, and what your reality looks like.


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

When you notice that your competitors are going on defense! One of the worst things you can do in a crisis is hunker down and ride out the storm. And that is the tendency for many companies - they sit idly by, and wait for the "norm" to come return. Meanwhile, the market landscape is adapting to new consumer wants and industry needs. When you see your competitors sidle off and play defense, that's when your organization needs to go on offense. But don’t be a bull in a china shop - be measured and precise in your moves.


4. Any tips for people who feel their company is wasting a good crisis?

Yes - don't let it continue! Crises present rare opportunities for companies to reinvent as there is typically less internal resistance to change if employees believe it will have positive impact. For those leaders who fear their company is in fact wasting the crisis, I would recommend they pull an about face, communicate their concerns, and work the problem from scratch with their management teams. Leaders need to dig deep and prepare for the long haul if they want to be effective in crisis-time, and that begins with open communication internally and an on-the-offensive approach to solutions.


5. What traits do you believe managers need to acquire to succeed in an innovation-led organization?

Open-mindedness, trust, vigilance, and determination. You must be open to outside-the-box thinkers. Plenty of people claim to have that mindset, but many are unnerved by truly original innovation as it may seem foreign to the point of being impractical. However, a handheld phone-mp3-computer seemed impractical (and impossible) 10 years ago, but now we have the iPhone. Trust is also key. You have to trust your teams to work effectively and create good ideas. There is a requisite need to delegate some control. It's the only way truly creative people create. At the same time, however, leaders are in charge - they must be vigilant and active in the innovation process. Leaders cannot be timid in voicing skepticism or input. Finally, one must be determined. Seldom does an idea work the first time around. Leaders have to be determined to see a great idea through to the end. In fact, what makes it a great idea is that it has been put through the wringer and improved.


In the future, I hope to bring you a review of "7 Lessons for Leading in Crisis" and right now you can enter to win one of three signed copies of this book in our October Innovation Contest.

---

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.

Video Interview - Saatchi & Saatchi CEO Kevin Roberts

by Braden Kelley

I had the opportunity to interview Kevin Roberts, CEO of Saatchi & Saatchi at the World Business Forum this week at Radio City Music Hall in New York City. You can see the video interview here:





Saatchi & Saatchi is a well-regarded advertising agency and Kevin Roberts has a lot of great insight on the customer. In this short video we chat about the evolving relationship between customers and their mobile devices, the state of integrated campaigns with social media as a component, and about Saatchi & Saatchi's "Do One Thing" (aka DOT) campaign.

For those of you don't know, Kevin Roberts is a contributor here on Blogging Innovation.

What do you think?

---

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.

Innovation Tournaments Interview

Interview - Christian Terwiesch of "Innovation Tournaments"

I had the opportunity to interview Christian Terwiesch, one of the co-authors of "Innovation Tournaments" about how to create and select exceptional opportunities. We also discuss a variety of other innovation topics including: barriers to innovation, education, and metrics.

Professor Terwiesch teaches MBA and executive classes in the areas of operations management and product development at The Wharton School of the University of Pennsylvania. He also holds a visiting appointment at INSEAD in Fontainebleau, France.

Here is the text from the interview:

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

Innovation is seen as an art and organizations believe that the best way to nurture innovation is to simply create the right organizational culture and environment for people to become creative. Open floor spaces, many meeting rooms, x-functional collaboration, etc. But it is not enough to rely on culture and the passion of individuals. You need to put processes in place and you have to equip people with the right tools of innovation. Innovation is NOT an art, I can teach you the basics of innovation in a day. I found innovation tournaments to be one great tool for people and organizations to move to a more process driven approach to innovation.


2. From your experience, what are some of the keys to increasing variability to help get the best ideas?

Variability is key in innovation and in innovation tournaments. The more diverse the set of ideas, the better are your winning ideas. But I find that many companies have a hard time coming up with high variability ideas. Those in charge of innovation always turn to the same people for ideas, they listen obediently to their bosses and to their customers. That kills variability. I'll give you another example - In some of our most recent research, we look at how brainstorming meetings function. Many of us are taught to build on other people's ideas in such brainstorming meetings. But our research shows that while this might make us feel happy and collaborative, the resulting ideas are actually less innovative. At least at the ideation step, you have to just break a lot of norms and existing molds.


3. What metrics do you usually see organizations using to measure innovation success?

Organizations need to measure innovation - what you don't measure, you do not manage. Talking to companies, I often see them struggle with measuring innovation - often I get asked "what measures should we track?". Organizations often don't know what they should measure. And so they measure what is easy to measure. Number of patents, percentage of revenues generated from new products, R&D spending, etc. You should not measure just for the sake of measurement. Before you measure, you first need a game plan, a strategy.

Let me give you an example. For managers, measures are what the dashboard is for a driver. They give you information about the way the process operates. Now look at the dashboard in your car. You are driving 60mph, your engine spins at 3000rpm and you currently get 20 miles per gallon. So what? These measures are meaningless unless you have some targets in mind. Is your goal to quickly drive from A to B? Then focus on speed and ignore the fuel efficiency. If you care about the environment, get into a higher gear (I like to drive with a manual transmission...) so your rpm's come down at the same speed and maybe you want to slow down to 50mph. Every performance measurement system needs to be custom built to fit your business needs. You cannot just ask a consultant for the "right measures".


4. 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?

I like to say "Fail quick, fail cheap, fail often". Innovation is all about failures. In an innovation tournament, you have 100s of 'losing' ideas for every winner. Our educational systems do not provide candid feedback to students. Every little project is praised as being great and every student is told that they did a 'good job'. So when these students graduate, they think that everything they touch is great. But they fail to understand that every great innovator loses far more often than they win. Innovation is not about avoiding failures, it is about recognizing a failure early and then learning from it.


My book review of "Innovation Tournaments" 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.

Do you know your 3 F's of Innovation?

Interview - James Todhunter - Invention Machine

I had the opportunity to interview James Todhunter, Chief Technology Officer at Invention Machine about engaging employees in a successful open innovation effort. Invention Machine is a software company that drives sustainable innovation across global organizations. In his blog Innovating to Win, Todhunter regularly offers insights and observations on building high-performance teams that can drive sustainable innovation across organizations.


Here is the text from the interview:

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

In general, I don't see organizations struggling to find an entry point into open innovation. Rather, the struggle comes in understanding the critical success factors that must be met, and how to face these challenges. While we are all aware of certain high profile companies that have achieved interesting results through open innovation, I hear many more organizations complain that they are not deriving value from their efforts. After an initial flurry of activity, the programs stall. The quality of input from the innovation communities is low and often characterized as shallow and immature. The reliability of value network partners is sometimes weak, and there is a great gulf between indentifying an interesting idea and delivering value in the form of a new product or market innovation. Overcoming the issues of authority, alignment, and actualization spells the difference between open innovation as just a big suggestion box versus being a source of value. This will be the focus of my session at the Open Innovation Summit.


2. From your experience, what are some of the keys to successfully engaging employees in an open innovation effort?

To engage employees in the open innovation initiative, it is critical to understand the roles of the many constituencies of innovation and communicate those roles clearly to internal communities. Every organization must take the time to look at the various communities, both internal and external, that contribute value to the corporate innovation programs. Internal communities such as engineering, marketing, production and all have distinct roles and functions to fulfill in the value creation and delivery process. The external communities include supply partners, production partners, logistical partners, and customers. When the roles and interaction points of these communities are understood, the open innovation system can be presented as a powerful tool to help employees be more successful and not be viewed as a source of noise or, in the extreme, a threat.


3. Do organizations need a centralized innovation group? What authority do they need?

Well, this is one of those questions must be answered with both a yes and a no. First, let's consider the no aspect of this. For a company to truly establish a sustainable and high performance innovation culture, it must first understand that innovation is everyone's job. That doesn't mean that everyone should go off and try to create the next great thing. Rather, it is a realization that the only constant in any business is change. Even as we establish best practices for operational efficiency, we need to consider how to tear them down and redefine best practices and the methods of execution in order to operationalize innovation as a force of change to help us achieve the continuous improvement we must always seek. This constant and continuous every day innovation is just one end of the innovation continuum. For others in the organization, innovation takes on progressively higher orders of meaning as our individual roles define the classes of innovation activities that we each must pursue. With this in mind, organizations should consider how they steward the development of innovation skills within the company and help individual worker grow their own innovation capabilities. Broad engagement in the innovation culture also has the benefit of preempting the NIH attitude that can prevent the diffusion of innovation when new concepts are foisted upon the workforce by what can be viewed as an ivory tower body.

However, even in such a ubiquitous innovation environment, it becomes clear that an organizing force is needed to create alignment and get everyone pulling the wagon in the same direction. This is the yes part of the answer. Companies that believe such systems will self organize as grass roots initiatives are fooling themselves. There are critical factors that are simply out of the scope of the rank file community and thus limit the traction achievable at the grass roots level. Providing a corporate wide innovation skills development program, building the infrastructure for knowledge enablement of innovation workers, ensuring the alignment of all innovation activity with corporate strategy, and making the trade-offs of resource allocations are just a few examples of activities that require some higher-level visibility and attention in the organization. It is for this reason that truly successful innovation cultures begin with a mandate from the top which is not merely expressed in words, but experienced by all through the consistent and constant reinforcement of action.

It is important to note that there is a lot of latitude on how such a central capability can be expressed in a company. It doesn't need to be an explicit organizational unit; it may be a managed matrix function. It is also not necessary that the central capability is the body doing the innovation per se, in many cases the central function is an enabler - a catalyst with the organization - of innovation.


4. What are some of the secrets to achieving organizational alignment when it comes to innovation?

The single greatest tool to achieve organizational alignment is communication. Communication must flow in all directions: top-down, bottom-up, and side-to-side. The communication must be rich and open. Management must communicate to employees the strategy, objectives, and relevance of each employee's job to the strategy. I remember walking around the production facility of a global semiconductor manufacturer. As I talked with different workers, the clarity and consistency of understanding of the strategic goal and each person's ability to impact that goal was remarkable. It is no wonder that this company is the leader in their space.

Employees must also feed information up the ladder. None of us are immune from the trap of our own personal experience. Management needs the input of the company's communities to have a complete picture on which to base its strategic assessments and properly understand the trade-off dynamics as they make both tactical and strategic decisions that will have far reaching affects on the company.

And of course, side-to-side communication and collaboration are fundamentally important for a complete alignment in the company's innovation programs.


5. What are some of the keys to validating ideas in order to pick the ideas to fund?

A great place to start is to examine the three Fs: fit, feasibility, and finance.

By looking at fit, you should asking questions about how well the subject concept meets the needs. Have you identified and qualified the customer pain you are going to address through your innovation? How differentiated is your concept relative to other potential solutions (including non-consumption)? What are the deficits of your approach? What are the change dynamics and hurdles to innovation diffusion that you may encounter and how does your concept address these? These and similar questions are all about assessing the scope and nature of your future value proposition.

When considering feasibility, the questions are now oriented towards understanding the implementability and market timing aspects of innovation. What technical challenges must be overcome to realize you vision? Do you have potential solution paths identified? What about freedom to operate? Do you have an open field, or are there intellectual property hurdles to be cleared? What is the time line to deliver on your concept and is that compatible with the market?

And of course, business is all about finance. What is the size of the opportunity? What is the path to monetization? Is this use of resources aligned with your objectives? Is this a strategic move or a distraction? What is the opportunity cost of pursuing this path as compared to others? How will you achieve a positive contribution to margin in the shortest time? How does this innovation contribute to the long range objectives for corporate valuation?


6. What are some ways that organizations can accelerate their innovation efforts?

Of course the specific needs of every organization are different. But in general, I would advise companies to walk the walk and not merely pay lip service to innovation. This means making the corporate commitment to innovation palpable at every level. Executive management must be visibly and meaningfully engaged in the innovation process. They must also show their commitment through investing in people, giving them the time, latitude, and support they need to successfully meet the corporate innovation goals. Workers must be provided with access to innovation skills training. Of course, the tools and infrastructure for innovation are essential. This is why Invention Machine's global clients invest in the Goldfire innovation platform. All of this must be in service of a comprehensive and connected high-performance innovation system that balances every day and strategic innovation, and ties all efforts back to the corporate objectives.


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

It is essential for managers to be able to properly value innovation and assess innovation strategies. Related to this, managers must be able to articulate the value of innovation to the various internal constituencies they touch. Finally, managing the dynamics of change within the organization is a key skill in maintaining a healthy innovation environment.


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?

A shift towards teaching critical thinking and learning skills is sorely needed. These are the building blocks of success in a future that will be defined by rapidly changing dynamics on a global scale. We aren't doing an adequate job of equipping the next generation of knowledge and innovation workers with these essential skills.


Tell Me More

If you'd like to hear more of what James Todhunter has to say about the challenges of open innovation and hear strategies for overcoming them, he will be leading a panel at the Open Innovation Summit, taking place December 2-4, 2009 in Orlando, Florida along with several other open innovation leaders, authors, and consultants. James Todhunter's talk is currently titled:

"Hands-On Strategies For Overcoming the Key Challenges Of Open Innovation"

September 18, 2009 is the last day for the $400 early bird discount.

Blogging Innovation readers can save an extra $300 by registering using the discount code - NXB458. More than enough to add Workshop B to your innovation experience.

See you there!

---

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.