Innovating Without Ignoring Today's Revenue

by Matt Heinz

Scott Cook, legendary founder of Intuit, discussed in a recent issue of Inc Magazine how today's entrepreneurs can continue to incubate new ideas while successfully focusing on today's day-to-day revenue generation. His answer can be broken down into four keys to achieving both innovation and execution today:

1. Make sure employees know which output metric they are responsible for and how it is measured. Focus on the metrics that matter most to growing the business (new customers, margin, top-line growth). These measures will ensure proper focus on today's business, and will also give employees a foundation from which to brainstorm and incubate new ideas focused on the same end-goal.


2. Enable all of your employees - not just a small group - to invest business ideas or product features. Don't predetermine which employees - based on rank or tenure or paycheck - will have your business's next great innovation. Oftentimes, it's the frontline employees who speak with your customers all day, every day who are first to see trends and identify new opportunities.


3. Run cheap, quick tests to make sure you are on the right track. The first step could be running the idea back by a few customers to gauge their feedback. But don't overthink these tests. Get enough feedback to hone the idea and mitigate risk/exposure of taking it to the next step.


4. Think big! For innovations to succeed, they must solve a large enough problem for the customer. This doesn't mean that every innovation is a new product, or new division, or fundamental shift in your business. It just means, to succeed, innovations need to make a profound impact on the customer. That impact can still be created by relatively small changes in policy, features, supply chain and more.

How does your company focus on innovation without ignoring today's revenue?

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

Why Open Innovation Matters

by Stefan Lindegaard

A few weeks back someone told me an interesting story about Procter & Gamble and their competitors. It is well-known that P&G is the open innovation champion and their long focus on open innovation has given them an important advantage.

They get to see interesting proposals within their business areas before their competitors. In the story I heard, one of P&G competitors complained they only saw ideas and proposals that P&G already had rejected. Ouch, talk about being a second-tier choice...

This leads to a very important point on open innovation for market leading companies and those aspiring to be. The key game is to become the preferred partner of choice.

A preferred partner of choice simply gets to see the best ideas first and such a position can help a company out-innovate their competitors and develop substantial long term overall business advantages.

As each industry only has one - or perhaps two - winners in this game, companies should begin to focus harder on their open innovation strategy and efforts. It becomes even more important as this positioning game already plays out in many industries. Let me give you a couple of examples.

Mobile phones: Apple and Nokia seem to have taken the lead here. I do not see much open innovation activity from Motorola, Samsung, HTC and the other players.

Software: IBM, SAP and Intuit are doing great things here. I acknowledge that software is a very broad business category that can be divided into smaller segments. Nevertheless, these are the companies I hear about on open innovation. What about the many other companies?

Technology: Cisco seems to build momentum over their direct competitors HP, Alcatel-Lucent and Juniper Networks.

Companies should have in mind that this game is very much about perception. A company starts an open innovation-like initiative and if they get some success they are encouraged to continue down this path. This is picked up by bloggers and others in the open innovation community and the word quickly spreads that a certain company is doing interesting things.

This spreads just as fast in the industry of the given company resulting in two things; internally the company gains even more momentum on their open innovation efforts and externally the company is perceived as an open innovation leader within the given industry.

Voila, the company is on its way to claim a preferred partner status and if they do not mess up they can soon reap the benefits of this.

I think this provides another example of why companies need to wake up with regards to open innovation. Your thoughts?

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Stefan Lindegaard is a speaker, network facilitator and strategic advisor who focus on the topics of open innovation, intrapreneurship and how to identify and develop the people who drive innovation.

Innovation as a Team Sport - Intuit

by Stefan Lindegaard

YOU: Fresh, dynamic, innovative entrepreneur or company. Relishes out-of-the-box thinking. Eager to deliver new product or service that improves the lives of millions. Web and social savvy. You think in the cloud - as in computing.

US: $3 billion innovative software company. Searching for passionate, spirited people who want to bring new ideas and products to life. Believes innovation is a team sport. Seeking possible long-term relationship. Hope to grow rich together.

No, this is not a dating agency. It is a quite unusual message from Intuit which on October 5 hosts their first Entrepreneur Day.

Entrepreneur Day is part of Intuit's broader initiative to drive mutual growth through open innovation and partnerships. They invite a select group of entrepreneurs, start-ups and small but more-established companies to meet and talk with a broad group of senior Intuit leaders including their founder and CEO.

Such an event is not a new thing in the IT-world, but I hope companies in other industries can learn from Intuit as I find this to be a great example on how you can establish relationships with external partners. Here are a couple of reasons:

1. Well-defined goals

• Intuit has set some clear goals on what they want to achieve from this initiative. They want to partner with young, dynamic companies to develop and launch innovative product offerings. Specifically, they are looking for:


• New business opportunities that align with Intuit's core markets and strategic direction, such as small business, personal financial management, taxation, online banking, personal health care information management and emerging markets.


• Leading edge technologies that Intuit can source to improve existing offerings or to create novel technology-enabled solutions, such as social software, mobile applications, data analysis, and Web 2.0 services relevant to our businesses.


• Such clear goals make it easier for Intuit to be successful at the event and it also makes it much easier for potential partners to judge whether the Entrepreneur Day is something they should consider attending.

2. A filtering process

• Besides the clear goals, Intuit also seeks quality rather than quantity and they have setup a filtering process to get this. Applicants need to fill out a form that is not too long and yet makes sense for both Intuit and the applying company. I also like this sentence taken from the website: "Although we'd like to meet everyone, we can't." Less is often more.

3. Intuit's contribution is clearly communicated

• Intuit does a pretty good job on explaining what the participating companies can expect from Intuit. It goes like this:


• "The potential rewards for collaboration are considerable: access to our leading brands, our large customer base, our award winning product lines, our developer ecosystem and our extensive marketing and distribution channels."

4. Strong commitment

• Intuit shows a strong commitment having their senior people and even Scott Cook, their founder and Brad Smith, the CEO present. It is not only a strong signal to the external partners that Intuit is serious about this event. It is also a strong signal internally that Intuit really wants to build strong external relationships.

5. Commitment to quick follow-up

• Intuit promises the participating companies a timely, candid and direct feedback on proposals and on next steps, if appropriate. You should not expect less as an external partner, but as we have seen in some of my recent blog posts this is not the case at other large companies.

I think Intuit has done very well so far. Hopefully, I can get my contacts at Intuit to share what they learn from their first entrepreneur day with us. It would also be nice to talk with some of the participating companies to check whether Intuit really follows up on their promises.

All in all, nice work by Intuit!

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Stefan Lindegaard is a speaker, network facilitator and strategic advisor who focus on the topics of open innovation, intrapreneurship and how to identify and develop the people who drive innovation.