Reducing the Risk of Innovation

by Dr. Mike Shipulski

Though we can't describe it in words, or tell someone how to do it, we all know innovation is good. Why is it good? Look at the causal chain of actions that create a good economy, and you'll find innovation is the first link.

When innovation happens, a new product is created that does something that no other product has done before. It provides a new function, it has a new attribute that is pleasing to the eye, it makes a customer more money, or it simply makes a customer happy. It does not matter which itch it scratches, the important part is the customer finds it valuable, and is willing to pay hard currency for it. Innovation does something amazing, it results in a product that creates value; it creates something that's worth more than the sum of its parts. Starting with things dug from the ground or picked from it - dirt (steel, aluminum, titanium), rocks (minerals/cement/ceramics), and sticks (wood, cotton, wool), and adding new thinking, a product is created, a product that customers pay money for, money that is greater than the cost of the dirt, rocks, sticks, and new thinking. This, my friends, is value creation, and this is what makes national economies grow sustainably. Here's how it goes.

Customers value the new product highly, so much so that they buy boatloads of them. The company makes money, so much so stock price quadruples. With its newly-stuffed war chest, the company invests with confidence, doing more innovation, selling more products, and making more money. An important magazine writes about the company's success, which causes more companies to innovate, sell, and invest. Before you know it, the economy is flooded with money, and we're off to the races in a sustainable way - a way based on creating value. I know this sounds too simplistic. We've listened too long to the economists and their theories - spur demand, markets are efficient, and the world economy thing. This crap is worse than it sounds. Things don't have to be so complicated. I wish economists weren't so able to confuse themselves. Innovate, sell, and invest, that's the ticket for me.

Innovation - straightforward, no, easy, no. Innovation is scary as hell because it's risky as hell. The risk? A company tries to develop a highly innovative product, nothing comes out the innovation tailpipe, and the company has nothing for its investment. (I can never keep the finance stuff straight. Does zero return on a huge investment increase or decrease stock price?) It's the tricky risk thing that gets in the way of innovation. If innovation was risk free, we'd all be doing it like voting in Chicago - early and often. But it's not. Although there is a way to shift the risk/reward ratio in our favor.

After doing innovation wrong, learning, and doing it less wrong, I have found one thing that significantly and universally reduces the risk/reward ratio. What is it?


Know you're working on the right problem.

Work on the right problem? Are you kidding? This is the magic advice? This is the best you've got? Yes.

If you think it's easy to know you're working on the right problem, you've never truly known you were working on the right problem, because this type of knowing is big medicine. Innovation is all about solving a special type of problem, problems caused by fundamental conflicts and contradictions, things that others don't know exist, don't know how to describe, or define, let alone know how to eliminate. I'm talking about conflicts and contradictions in the physics sense - where something must be hot and cold at the same time, something must be big while being small, black while white, hard one instant, and soft the next. Solve one of those babies, and you've innovated yourself a blockbuster product.

In order to know you're working on the right problem (conflict or contradiction), the product is analyzed in the physics sense. What's happening, why, where, when, how? It's the rule (not the exception) that no one knows what's really going on, they only think they do. Since the physics are unknown, a hypothesis of the physics behind the conflict/contradiction must be conjured and tested. The hypothesis must be tests analytically or in the lab. All this is done to define the problem, not solve it. To conjure correctly, a radical and seemingly inefficient activity must be undertaken. Engineers must sit at their desk and think about physics. This type of thinking is difficult enough on its own and almost impossible when project managers are screaming at them to get off their butts and fix the problem. As we know, thinking is not considered progress, only activity is.

After conjuring the hypothesis, it's tested to prove or disprove. If dis-proven, back to the desk for more thinking. If proven, the conflict/contradiction behind the problem is defined, and you know you're working on the right problem. You have not solved it, you've only convinced yourself you're working on the right one. Now the problem can be solved.

Believe it or not, solving is the easy part. It's easy because the physics of the problem are now known and have been verified in the lab. We engineers can solve physics problems once they're defined because we know the rules. If we don't know the physics rules off the top of our heads, our friends do. And for those tricky times, we can go to the internet and ask Google.

I know all this sounds strange. That's okay, it is. But it's also true. Give your engineers the tools, time and training to identify the problems, conflicts, and contradictions and innovation will follow. Remember the engineering paradox, sometimes slower is faster. And what about those tools for innovation? I'll save them for another time.


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Dr. Mike Shipulski (certfied TRIZ practioner) brings together the best of TRIZ, Axiomatic Design, Design for Manufacturing and Assembly (2006 DFMA Contributer of the Year), and lean to develop new products and technologies. His blog can be found at Shipulski On Design.

Innovation gone too far? - The Toyota Recall

by Robert F. Brands with Jeff Zbar

Once upon a time, to start your Toyota Camry, you placed a key in the ignition and turned until the electrical connection was made and engine started.

To accelerate, you pressed the gas pedal, which pulled a cable attached to a mechanical throttle. Assuming the shift had been manually placed into gear - the car moved.

Today, electronics and computers have replacement many of the mechanical parts that once made cars move. To start many cars or place them in gear, buttons are pushed. To accelerate, the gas pedal is connected not to a cable, but to a computer - via electronic circuitry.

In light of Toyota's massive recall of 10 million of Camry, Tercel, Prius hybrid and luxury Lexus models (and that's a shortened list), one has to wonder: At what point does innovation encourage failure?

In other words, has Toyota gone too far? In the interest of fairness, these issues potentially affect any modern automobile. Already, GM is facing recalls related to steering.

The costs - in terms of finances and consumer confidence - can be great. As Toyota mechanics are correcting millions of cars and consumer confidence lags, rival automakers have reported double-digit sales growth.

But the question of innovation for innovation's sake - or for the sake of "technological evolution" - begs to be asked. Sure, innovation of the vehicle and the way it's manufactured cuts costs, including labor and benefits. We continually innovate to cost reduce. But now, cars don't just turn on with the turn of a key. And when they don't roar to life as expected, the corner mechanic must be trained not only in auto repair, but in computers technology (assuming he or she owns the equipment).

This reminds me of a story. It was the 1970s. Two adventurers once were traveling by pick-up truck in northern Mexico when their vehicle broke down. The local mechanic took a look under the hood, grabbed a coffee can of old parts, and fashioned a fix.

How does this all relate to the innovation imperatives? In "Robert's Rules of Innovation", it mentions two key imperatives that seem to have gone awry here. First, Toyota sought the imperative of value creation in pursuit of innovation. Yet, any value created through their innovation-gone-awry is more than lost through the recall and labor costs and lost sales and good will.

Second, who has been held accountable? After first declining to do so, Toyota President Akio Toyoda made a very public appearance on Capitol Hill. He apologized and promised to "do everything in my power" to ensure the malfunctions and tragedies don't happen again. Do Americans buy it? Can Toyota afford to wait and wonder?

To that end, the complexity of the conundrum facing Toyota at one point was belied by the simplicity of their first apparent fix. After spending days in conference over how to remedy the stuck throttle, high-paid engineers came up with a simple solution: Shorten the gas pedal.

To be sure, in the end, the issues facing the automaker were far more complex than nipping an inch off a too-long pedal. But could the issues have been remedied in the designer's or accountant's office years ago - when the company believed innovation would save money?

We - and Toyota - may never know. But we've learned that innovation poorly planned can have the greatest expectations, but the worst outcomes.


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Robert Brands is the founder of InnovationCoach.com, and the author of "Robert's Rules of Innovation: A 10-Step Program for Corporate Survival", with Martin Kleinman - to be published in March by Wiley (www.robertsrulesofinnovation.com).

The Museum of Why

by Matt Heinz

Too many brands, companies and even vertical sectors assume what they do is, well, what they do. They define their value based on their current tactical, delivered product or service to the market and to their customers. But that's not at all what they do, of course. Let's look at a couple examples.

People don't buy a newspaper because it's printed news. They can get that news from a myriad places today. So what makes newspapers unique? What value do they really serve? I actually read the newspaper more often now than ever, but I don't subscribe to the print edition. I read online every day, check various reporters' blogs for intra-day updates, and count on newspaper reporters to take complicated issues and boil them down to something I can read briefly, get the gist of the story or message, and move on with my day. That's value, and has nothing to do with the means by which that value is delivered to me.

So many sectors, so many businesses need to ask "why" several times over to understand their value to their customers. Why is this important? Why do my customers care? Why is this different and valuable to the marketplace?

Let's say you're the curator of a museum. Historically, your product has been a building with artifacts, exhibits and other physical manifestations of the history and ideas you are preserving. But if you were starting the museum from scratch, what would you do differently? How would you boil down your purpose to its essence, combine that with the target audience you're serving, and deliver a product that more directly reflects and achieves that focus?

If you still think part of the answer is a building to preserve artifacts, that may be fine. But keep asking why. At the end of those "why" questions is your core value.

If you could start your business or category/sector from scratch today, how would you address the answer to that final "why" in a different way? How could you deliver value faster, more effectively, and more completely than you do today?


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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.

Value Creation: The Ultimate Goal of Innovation

by Robert F. Brands with Jeff Zbar

Why innovate?

Some would argue that companies innovate to achieve a heightened competitive advantage, streamline the organization, or create intellectual property - including patents, trademarks and other protected property - that create value in the portfolio.

Many reasons and rationales can be argued for the pursuit of innovation. Yet no purpose for or result from innovation can be more compelling than Value Creation. This metric is the ultimate measure of return on investment when measuring innovation's role in creating value.

Simply put: Innovation done well drives value creation - for the organization, its customers, its internal stakeholders and its external shareholders.

Successful innovation turns ideas into money. All the processes, creativity, time, sweat, research, dreaming, refining, modeling and retesting transform effort into tangible, valuable results.

This includes innovation that touches all sectors in the company or organization - not just in the creation of a new product or service. Enhancing the business model or networking, enabling a new core process, creating a new channel, brand or customer experience delivery model, or offering a new product system, boosting product performance, or providing a new service each creates value.

Nowhere is this more relevant and apparent than in the acquisition process. If one were to look at acquisitions with and without a patent portfolio, I would argue that a well-created and -managed patent or IP portfolio can double company value. My former company, Airspray, created of the novel packaging and dispensing process that turned liquid soap into foam. It was a company with a typical value of 7-8x EBIT. Yet, the addition of this patent to its portfolio resulted in 15x EBIT paid when the company was acquired in 2006.

This is especially important in today's market. Current economics continue to hold down already devalued corporate stock prices. Companies are challenged to find ways to boost their value to stakeholders - as well as to keep customers and prospects engaged and purchasing goods. Value creation borne from innovation can be critical indeed. As evident in the Airspray example, one item in our patent portfolio almost doubled the EBIT paid at acquisition. This example is not unique, but was the result of painstaking and thoughtful focus on value created by innovation.

Moreover, value creation and innovation done well can immeasurable enhance the corporate brand. Between adding new products, reviving the corporate dress, even launching new marketing creative or advertising campaigns, customer value can be created through the value-added components and enhanced public face of these endeavors.

Of course, it's essential to find that delicate balance between cost, price, and return. Balance is found, in part, by seeking stakeholder input and customer feedback during development of any innovation process.

The arguments for innovation are, frankly, inarguable. Value, brand enhancement, share price and perception among various stakeholders can be elevated by innovation done well. Add to the equation the inclusion of intellectual property derived during the process, and the overall ROI can be well worth the investment.


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

Stop Selling and Add Value

by Mike Myatt

What I'm about to espouse will cause many an eyebrow to furrow and jaw to drop. I truly believe that the practice of sales as a business discipline has become at best ineffective, and in many cases flat out obsolete. You see, good business practices are not static. Stale methodologies and disciplines simply die a slow and very painful death, and it is my contention that the overwhelming majority of sales processes I see in today's marketplace are just that...stale. If you want to create revenue, increase customer satisfaction, and drive brand equity, stop selling and start adding value. In the text that follows I'll share my thoughts on how the practice of sales must change in order to survive.

Lest you think I've lost my mind, I want to be clear that I'm not advocating taking your eye off the revenue creation ball. Rather what I'm recommending will help you generate more revenue, with greater velocity by simply doing the right thing in putting your customer's needs first. I hear a lot of noise about the tough economy, and revenue being down for many companies. I hear complaint upon complaint that companies just don't have money to spend, and that nobody is buying. If you're experiencing this type of reaction from your customer, it's not because they don't have money to spend, it's because you're selling and not adding value. It's because you're talking and not listening. It's because you don't get it. It's not about you, your company, your products or your services. It's about meeting customer needs and adding value.

The problem with many sales organizations is that they still operate with the same principles and techniques they were using in the 60's, 70's and 80's. While the technology supporting sales process have clearly evolved, the traditional sales strategies proffered by sales gurus 20 or 30 years ago have not kept pace with market needs. They are not nearly as effective as they once were, and as I've eluded to, in most cases they are obsolete. Trust me when I tell you that your prospects and customers have heard it all before. They can see the worn-out, old school closes coming a mile away. They can sniff antiquated selling strategies, and will immediately tune out on presentations not deemed relevant. If your sales force is still FAB-selling, spin-selling, soft-selling or using any number of outdated, one size fits all selling methodologies, your sales are suffering whether you realize it or not.

So, my first suggestion is that you change nomenclature. Think about this example - in most corporations there exists a hierarchy of sales that comes with a very established and entrenched pecking order. The enterprise sales folks and key accounts reps sit atop the food chain, followed by inside sales reps, and at the bottom of the latter you'll find the customer service reps. The hunters are revered and the farmers are tolerated. Regardless of the titles being used, this entire concept of sales is so antiquated it's laughable. Frankly, most people I know would rather talk to a knowledgeable customer service person over a sales rep any day of the week. The reason for this should be obvious. The perception is that a customer service professional is providing information and helping them meet their needs. A sales person is trying to sell them something.

Call me crazy, but I don't want to talk to someone who wants to manage my account, develop my business, or engineer my sale. I want to communicate with someone who wants to service my needs or solve my problems. Any organization that still has "sales" titles on their org charts and business cards is living in another time and place while attempting to do business in a world that's already passed them by. It's time for companies to realize that consumers have become very savvy and very demanding. Today's consumer (B2B or B2C) does their homework, is well informed, and buys - they are not sold.

Engage me, communicate with me, add value to my business, solve my problems, create opportunity for me, educate me, inform me, but don't try and sell me...it won't work. An attempt to sell me insults my intelligence and wastes my time. Think about it. Do you like to be sold? News flash...nobody does. Now ask yourself this question, do you like to be helped? Most reasonable people do. The difference between the two positions while subtle, are very meaningful and powerful. If customer centricity is a buzzword as opposed to the foundation of your corporate culture then you have some work to do. The reality is that until I know that you care more about meeting my needs than yours, you'll remain on the outside looking in. By the way, in order to understand my needs you have to actually know something about me.

The first thing to do when assessing your sales model is to take a giant step back, and critically examine the current landscape. You can't fix a problem that you don't understand, and implementing change for the sake of change will likely only make matters worse. If what you've read thus far even remotely resonates with you, then I would suggest reading "Don't Negotiate...Facilitate." Teach your sales force to become true professionals focused on helping their customers for all the right reasons vs. closing the big deal for personal benefit. Otherwise you will likely miss substantial opportunities without even being aware of it.

The bottom line is that the most important factor in creating revenue and building brand equity is the client/customer/end-user. If you don't engineer everything around the client, your client relationships will vanish before your very eyes. I would strongly recommend reading "Understanding Your Customers," and "Leveraging the Customer Experience."

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

Innovation Perspectives - Engineering versus Intangible Value

This is the first of several 'Innovation Perspectives' articles we will publish this week from multiple authors to get different perspectives on 'Roadblocks and the Critical Relationship Between Marketing and Engineering in the Cause of Advancing Innovation'. To kick it off, here is my perspective:


by Braden Kelley

Let me start off by recommending that you watch the movie I've embedded, as it does a great job of describing how there is often an engineering solution to a problem and a marketing solution to a problem. This in part explains why there is often a tension between marketing and engineering when it comes to new product development - they see different solutions, assign value differently, and view success in divergent ways. So, please enjoy the video, and my article will continue below it:





So in the future, with the problem at hand, you might want to ask yourself - "Is the problem best solved by changes to the real value, redefining the intrinsic value provided, or a bit of both?"

Of course it is very hard for people to ask these questions honestly as they have a default response, but asking them in a cross-fuctional environment may yield a more holistic and informed response. And after all, many of the barriers that people tend to erect in the achievement of something are often because they didn't feel involved in the decision-making process.

So, what are some of the barriers that people erect in a sometimes tension-filled environment?

1. Isolation - You just avoid communicating with the other side as much as possible


2. Stonewall - You just do what you would do anyways and ignore the input from the other side


3. Passive Aggression - You consciously choose to behave in a way that will cause the effort to fail, so that ideally you get your way instead


4. Build a Fortress - You build complex written rules of engagement for your department saying that it has to be this way because you're too busy and these rules will help you be more organized


5. Omission - You take the inputs but then you don't do anything with them (marketing doesn't promote a feature, or engineering doesn't fully develop it

The biggest danger to the cause of advancing innovation when it comes to the engineering and marketing departments is that the relationship develops into one without constructive conflict and without healthy collaboration. For innovation to be repeatable in an organization these two sides must share openly, have their perspectives valued, and contribute to a conversation. Marketing and engineering hear different aspects of the voice of the customer in their interactions with them, and they approach solutions to problems in different ways.

I would even argue that there is probably no more important set of cross-functional relationships than those between marketing and engineering, and that their health will determine the future success or failure of the organization. The executive team should consciously monitoring the health of these relationships, because when they start pulling in opposite directions, the entire organization could be ripped apart.

What directions are these two organizations pulling in your organization?


You can check out all of the 'Innovation Perspectives' articles from the different contributing authors on 'Roadblocks and the Critical Relationship Between Marketing and Engineering in the Cause of Advancing Innovation' by clicking the link in this sentence.

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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.

Creating Priceless Value

by Kevin Roberts

This week was a biggie - speaking at HSM World Business Forum at Radio City Music Hall in New York. I was onstage immediately before George Lucas, and as much as I would have loved to stay, I had the week from hell with speeches and meetings over the following three days in Miami, Washington DC, and Chicago.

In the lead up to the event I recently gave a webinar where I gave a preview of what I covered in my presentation, and I answered about 20 questions which poured in from all parts of the world.

In my webinar opening remarks I focused (again!) on Winning Ugly, which has been my mantra at Saatchi & Saatchi since the recession. There are a bunch of ways to win ugly, but one constant in the list is reframing your beliefs about value. With more choice, more connectivity, and less spend, consumer power is reframing the notion of value.

In this time of "new frugality" everyone is wanting more for less. People are evaluating more (71% of Americans shop online before buying a car), trying more, comparing more, and contemplating switching more. Online themselves, and online through others.

Here are the ways consumers are thinking about value; they're saying:

"I'm sorting true value from false economies."
People want smart abundance, not rubbish

"I'm not cutting back on luxuries, I've just redefined what luxuries are."
People still treat themselves, just not in the same way.

"I'm into the challenge of finding creative solutions."
Ingenuity is the new innovation.

Companies must jump-shift their value comparisons.

P&G invites consumers to compare Tide Total Care with the costs of dry cleaning.

Prius invites drivers to enjoy exhilarating motoring while at the same time refreshing the environment.

Tylenol shifted the goal posts in an admirably non-self-serving way: their advice for a headache? Drink a glass of water, wait 20 minutes - and if you still have one then take Tylenol.

Even a private jet company - Flexjet - reframed its private jets from a luxury item to a valuable business tool, from status-oriented cost center to commonsense transport investment.

Each of these examples represents an 'emotional bonus'. They check the rational value boxes but also deliver emotional value by improving your world.

I call this Priceless Value... uplifting life solutions tuned to how people are feeling, living, spending - and sharing.

I'll be talking again about reframing value, and creating priceless value, at Radio City. Now this, for me, is Priceless.


For more with Kevin Roberts, check out our video interview from the World Business Forum.

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Kevin Roberts is the CEO worldwide of The Lovemarks Company, Saatchi & Saatchi. For more information on Kevin, please go to www.saatchikevin.com. To see this blog at its original source, please go to www.krconnect.blogspot.com.

10 Innovation Lessons I've Learned

What should innovation leaders and intrapreneurs know about innovation projects and new ventures? I have had the pleasure of working with such people for many years and I begin to see a pattern that I have summarized into 10 lessons for innovation leaders and intrapreneurs:

1. Know that innovation and intrapreneurship is about teams

• build a team of people with complementary skills who are committed to a common purpose, performance goals, and approach for which they hold themselves mutually accountable (team definition by Katzenbach/Smith)

2. Work with passionate and persistent people

• nothing goes as planned in new ventures. Passion and persistence help overcome most challenges and they are essential for making great things happen.

3. Use recognition and stories

• recognition if often a better rewarding tool than money. Explore ways of recognizing people and use it to develop compelling stories that sells your company better than cold facts.

4. Define your target markets and eco-systems

• well-defined target markets are key to crossing the gap between early adopters and the main market. You also need to know that all markets are networked and that you need to break the current set of behaviours of many stakeholders within the eco-system before you can establish a new market equilibrium.

5. Understand the value proposition

• build a clear and concise statement that outlines your value-creating features to customers and stakeholders.

6. Craft an elevator pitch

• you always have something to sell; learn how to craft an elevator pitch that captures the very essence of your value proposition in terms that focus on the recipient of the message.

7. Define your values, personal brand and relationships

• know what you stand for and which messages you send to others and know the structure of your network and relationships; learn how to adapt to fit your strategic goals.

8. Define your team brand

• learn how to use values, personal branding and relationships as a team discipline to penetrate and win new markets.

9. Bring depth, breadth and empathy to the table

• all team members should have depth in an area that is critical to the company as well as breadth and empathy for the other things that makes or breaks the company.

10. Combine internal and external forces

• on development issues it is important to make "reapplied with pride" just as important as "invented here." Remember that the wealth of external knowledge outscores your internal knowledge and you need to turn this into an advantage. Get on the open innovation movement.

Let me know what you think.

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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.

Value versus Price

When 2008 came to a close, Nestle looked up and saw that revenues were up ten percent, fueled in part by higher prices. Procter & Gamble reports that its premium products are doing just fine, despite being priced 60 percent (Tide Total Care) or 70 percent (Clairol's Perfect 10) higher than its base brands. Pepsi is stepping up support of its Rockstar energy drink, which sells for five or six times as much per ounce (according to Beverage Digest) as regular soda. Even Gucci Group reported healthy revenue gains in 2008.

What's going on here? Aren't we experiencing the worst economy in generations? Indeed we are, but the companies above (and others) understand that their customers are making a flight to value, not merely to cheap. Sometimes value means "less expensive" (GameStop is projecting double-digit sales growth this year based on its used offerings and perception of videogaming as affordable entertainment), but value can also mean "more for your money," which, through a variety of approaches, Nestle, P&G, Pepsi and Gucci are managing to provide ($2.2 billion in R&D last year at Procter & Gamble, to cite one example.)

The easiest strategy to follow in tough times is discounting. But it can also be the most deadly. Every company should be taking a hard look at its value equation in this environment. But no company should forget that equations always have more than one variable. Providing more value for the money is almost always a better strategy than asking less money for the value.

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

Microsoft's Vision for 2019

I found this video showing how Microsoft imagines we might interact with technology in the world in 2019, and I can't say that I agree with what they find to be compelling real world uses for future technology.

As I watched the video, I saw lots of things that were visually interesting but very little that would deliver increased productivity or true value in terms of time or money savings.



Most of what they are imagining I find to be visual noise, that would actually decrease productivity and overload the brain.

The most compelling thing I saw was the digital white board that they quickly skipped over.

Second most compelling was the plant identification by video input example. If you expand that to showing the computer just about anything and receiving back information about what you are seeing, it could be a very valuable educational tool.

What do you see in this video that is compelling?

@innovate

Are you the tenth person who innovates?

"For every nine people who denounce innovation, only one will encourage it... For every nine people who do things the way they have always been done, only one will ever wonder if there is a better way. For every nine people who stand in line in front of a locked building, only one will ever come around and check the back door."

"Our progress as a species rests squarely on the shoulders of that tenth person. The nine are satisfied with things they are told are valuable. Person 10 determines for himself what has value."

- Za Rinpoche and Ashley Nebelsieck, in The Backdoor to Enlightenment

As I've said before, innovation is achieved when something becomes valuable to the customer, instead of merely useful. Are you standing in line with your competitors, or are you creating the real value that will help you achieve competitive separation?

You Cannot Always Invent Your Way to Innovation

I'd like to start today with a quote from a NASA article in Fast Company - "But sometimes the better part of innovation, is not invention but effectiveness."

I've detailed my views before on how invention is not the same thing as innovation, but to build upon them and the quote above - sometimes progress or innovation is achieved by taking value out of a product or service. Southwest Airlines created innovation not by giving passengers more food, more legroom or more options, but fewer. Apple succeeded with the iPod, not by providing more capacity or more features, but by making the features they provided more beneficial than the competition.

People ultimately do not care whether a product or service is better at the tasks it is asked to perform, but whether it more effectively meets their needs. These are not the same thing, and in fact make success far more difficult.

A sponge may clean better than all other sponges at absorbing liquids, but if to do so it has to smell like a wet troll, it is ultimately not going to be the sponge most effective at meeting customers needs (or likely to make repeat visits to their shopping baskets). Success becomes more difficult because customers don't always surface their needs. Chances are your market research wouldn't have surfaced their need for a sponge not to smell like a wet troll. But if succeeding becomes more difficult when success is not purely a technology challenge, then this is a good thing for the truly committed, because difficulty creates opportunity.

So during the product development process, don't ask yourself "How can we make X do Y better than the competition?". Instead focus people's attention on asking "How can we better meet our customers' needs?". If you focus on the second question, the competition becomes almost irrelevant, and you will become better at creating products or services that are more likely to be valuable instead of merely useful, and that is where true innovation lies.

What do you think?

@innovate