Innovating To Win

Spirit of Innovation

To those of you who have been wondering why this blog has been so quite the past few days, I am sorry to have left you wanting, but I have been attending to the details following the death of my mother.  In times like this, there is always the impulse to reflect.  I have been doing my own reflection on many things.  One such topic of reflection has been the nature of the innovative spirit and the impact my parents had on my own growth as an innovation practitioner.

There are generally two camps on the topic of how innovators come to be.  There is the innovators-are-made camp which believes that innovation is a learned skill and can be taught and codified.  The other camp is the innovators-are-born camp which believes that a special creative spark of genius distinguishes the innovation elite.  In one sense it is an irresolvable question, as the members of the second camp always have the convenient refuge of claiming that anyone who can be taught the art is able to learn it only because they were already blessed with the innovators spark.  Still, we ponder the question.

In my own case, I can see that there have been two distinct forces that helped form my own innovation impulse.  My father was an inventor and innovator in his own right.  He taught me many of the basic skills of innovation at an early age.  Some of my earliest memories of my father are of him teaching me calculus and electronic design in the backyard when I was six.  He strongly believed in passing along what he knew, so he taught me think critically, to design and build things, and to be unafraid of taking creative risks.

However, these basic skills were not enough to mold the innovation practitioner I have become.  It also required the element of passion.  For this, I have to thank my mother.  She inspired me to believe that anything I could imagine was possible, she cultivated in me an insatiable hunger for knowledge, and she encouraged me to relentlessly seek the truth that is at the core of every great innovation.  Passion combined with skill is the formula for success in most arenas of practice.  Innovation practice is not different.

So, as look to my own innovator’s spirit, I can see the clear evidence of some not so invisible hands molding my thinking and stoking the fires of passion that have guided my professional life.  I was made an innovator.

I have many times in the posts on this blog asserted that innovation skill and competence are transferable and that organizations can benefit greatly by establishing high-performance innovation environments that cultivate and develop these capabilities to the highest level.  After reflecting on the subject these past few days, I am convinced more than ever that this is true.

In these very competitive times when the evolution of market and technology landscapes accelerates on a daily basis, no company can afford to ignore this truth and leave their future to the random outcomes which are the domain of accidental innovation practice.  Success in tomorrow’s world that is here today requires a focus and diligence of innovation execution that is second to none.

Will your company be a leader or a laggard?  Will your company define the future or fall victim to its ruthless advance?  What to you think?

This post is filed in loving memory of my parents and innovation mentors:
John Arthur Todhunter 1904 - 1973
Maria Teresa Torres de Todhunter 1919 - 2007

Inconsistency = Opportunity

Seth Godin points out that inconsistency in human behavior is a factor that must be considered in marketing.  It is also an important factor for designers and innovators.

The nuances that define individual choices and allow us to rationalize our personal inconsistencies also define opportunities for product and service differentiation.  Understanding the customer goals that drive these nuanced variations in customer posture can lead to the identification of new market segments.  Embrace and respond constructively to your clients' inconsistencies.

Six Sigma and Innovation

In the wake of the recent 3M story around Six Sigma and innovation, many people have been asking if efficiency programs and innovation programs are fundamentally at odds.  While I have already posted on the specific 3M story, I have received some emails asking for further insights on the potential for synergy between Six Sigma and innovation best practices.

The observation many have made is that Six Sigma is all about driving down costs and that this focus doesn’t seem compatible with the goals of product innovation.  So where is the room for innovation in Six Sigma?  To begin this brief exploration, let’s begin with some history.

Six Sigma was developed in the 1980’s as a response to the recognized cost of poor quality.  The idea was that customers feel the variance, not the mean.  Thus, by reducing variability the client experience would be made more reliable yielding the benefits of: elimination of waste, rework, and mistakes; increasing customer satisfaction; and enhancing profitability and competitiveness.  After some time, the system we recognize as Six Sigma evolved.  There are some variants; here we will focus on DMAIC (Define, Measure, Analyze, Improve, Control).  But first, let me say a quick word on DFSS (Design For Six Sigma).

DFSS is distinctly different from classic Six Sigma.  Whereas classic Six Sigma is a methodology focused on the optimization of the manufacturing process, DFSS is a newer method that encompasses the entire product development cycle.  This necessarily includes the front end product definition, design, and ideation activities.  While DFSS does not formally include specific tools for innovation, the DFSS process does contain a natural insertion point for innovation best practices to fill the innovate-here step.  As this is well understood by DFSS practitioners, here we are not addressing DFSS and instead we focus on DMAIC where the points of innovation synergy may not be so obvious.

To understand how innovation best practices can be used to augment a classic Six Sigma program, it is useful to consider the methods (or tools) that are in common use to implement Six Sigma.  Some of these include: Voice of the Customer, Quality Function Deployment, Root Cause Analysis, Process Mapping, Failure Mode Effects Analysis, XY Matrix, PUGH Matrix selection, Value Engineering Analysis, TRIZ (Theory of Inventive Problem Solving), Robust Design, Design of Experiment, and Mistake Proofing.  Each of these specific methods can be enhanced with the use of innovation best practices.  Let’s think about how this could map to the phases of DMAIC.

Define
In this first phase, the project goals and customer (internal and external) deliverables are clearly articulated.  Innovation best practices for problem definition using product and process analysis technique can be used to help identify and refine CTQs (Critical to Quality factors) as well as XY Matrix elements.  Root cause analysis is also helpful to qualify the issues being considered and validate that the right issues are addressed.  House of Quality elements can be mapped to Value Engineering Analysis metrics to help drive down stream analysis.  Best practices for concept identification can be use to better identify risk mitigation strategies.

Measure
In this phase, the process is measured to baseline current performance.  Product and process analysis methods can be used to identify the parameters and performance aspects of the system to be measured.  Concept generation disciplines may be used to identify novel strategies to for measurement of factors that are not easily measured.

Analyze
The Analyze phase is used to determine the root causes of the system defects.  While some traditional DMAIC environments will use only statistical tools for this analysis, some more progressive environments will perform CTQ selection via parameter analysis and value engineering analysis.

Improve
Once the targeted defect is understood, it is time to improve the system by eliminating the defects.  In many cases this tuning is done through incremental tuning of the system.  However at times, there may exist the opportunity to implement a more fundamental change to the system.  In these cases, concept generation methods can be fruitfully applied to identify known solution strategies for parameter optimization.

Control
The final phase of DMAIC is about ensuring future process performance continues to conform to requirements.  Here, innovation best practices can be employed to predict and prevent future failures and system non-conformances.

In short, while classical Six Sigma is primarily a statistically driven approach to system performance optimization, there are opportunities at every phase within the methodology to augment the process with innovation best practices.

… And The Truth Shall Set You Free

It is interesting to see how high-profile innovation practitioners express their views on innovation.  I just noticed a reference to an interview of Ivy Ross, Chief Creative Officer for Disney Stores on Bruce Nussbaum’s NussbaumOnDesign blog (who was in turn referencing Diego Rodriguez’s Metacool blog).  The interview appears at Ambidextrous and is interesting.  In general, Ivy makes some very insightful observations, but I don’t think her comments are always on target.

Ivy makes the statement, “… creativity and innovation are built around trust and freedom.  Companies don’t get that.  They think it is a process. It is really about creating trust between the people creating and the freedom to go to new places.”  If she had said that collaboration is about trust, I could certainly agree; but she is talking about innovation.  Innovation is not about trust; innovation is about truth.

The notion of good innovation practice being about truth is well supported in the literature.  You don’t have to look hard to find this leitmotif wafting in the papers and publications of many of the most respected names in the field of innovation.  For example, when Clayton Christiansen talks about understanding the job that a product performs, what he is getting at is the need to look beyond the producer’s pre-conceived notions about what the function of his product is and discover the truth of what customer needs your product should be fulfilling.  The theme can also be found in the work of Jan Carlzon when he talks of moments of truth and the need to recognize every customer interaction as a defining moment.  A more recent manifestation of the theme is found in Erich Joachimsthaler’s recent book where he outlines the critical value of understanding the opportunity space that is defined in part by your customers’ goals, priorities, and activities.

So how can people find truth?  Reliance on serendipity is not the answer.  In fact, to hold such a position in today’s corporate environment is at best irresponsible.  It is interesting to note Ivy’s words on her method of seek answers.  She articulates the steps as: taking in information, processing it, and reconstructing it.  Call me a cynic, but this sounds like a loosely described process to me.  The fact is that if you want to break away from the quagmire of fruitless, accidental innovation, then you must embrace the notion of informed design and the structured methodologies for achieving repeatable innovation.

It is good to see that Ivy does acknowledge the basic thesis of informed design.  She talks about eating everything (gathering information) and the value of building on the ideas of others.  This is at the core of the informed design principle.  However, it is also important that people eat the right information diet.  In design and innovation, you truly are what you eat.  In our information rich environment, we are all awash in data and challenged to find the useful information that will help guide us to new insights.  This is why infrastructure is needed to support our innovation efforts.

Ivy is right on target with her statement, “You have to dissect what is the value of that connection.”  Here she is pointing out the need to question the motivation and utility of our products—in essence, to surface the truth which is latent in the market and extract the key value driving parameters around which the design process should be focused.  It is also important to understand, that she rightly points out that until innovators consider the complete needs set of customers, they will not be able to arrive at the optimal whole product—the right-to-market entirety.

All these factors are essential to realization of value driving innovation competence:

• understanding that innovators should seek to uncover the truth of the market in which they operate
• embracing that innovation process is needed to achieve sustainable innovation
• equipping designer and innovators with the proper tools and infrastructure to help then sift through the vast mountains of information they has available to them
• expanding our innovation vision to consider the customer need set holistically and map those needs into the deliverable value of a client-product connection

These principles will help guide designers and innovators to the truth—the truth defined by customers latent goals, priorities, and activities—and the truth will lead to the freedom of creativity and innovation that Ivy describes.

KSR v. Teleflex – Good or Bad for Innovation?

There have been several interesting and thoughtful posts in the blogosphere recently in the wake of the Supreme Court KSR International Co. v. Teleflex Inc. et al. decision of April 30.  This is a very interesting ruling with many potential implications that have yet to play out.  The assessment of whether this decision is good or bad for innovation is a very subjective one which rests on your personal objectives and whether you feel constrained or protected by the current intellectual property status quo.

Personally, I am still sorting out the reasonably foreseeable impact this ruling will have on innovation.  Here are some initial thoughts on the topic.  I’d love to hear what you think.

It is quite clear that this case and the decision in particular highlight the business value of innovation and patents.  The opinion speaks to the very nature of innovation and classifies levels of novelty by defining a concept of ordinary innovation.  This classification has been underlying the discussion of how patents help or hinder progress.

The patent system was designed to help foster innovation.  It accomplishes this goal in two ways.  By granting a restricted monopoly to the patent holder, the patent system helps mitigate some of the risk of invention by giving the inventor a window of protected opportunity in which to reap the benefit of their investments in the development of the protected invention.  The patent process also accelerates innovation by exposing, through the publication process, new knowledge to the public which would be presumably otherwise withheld.  Through this exposure, the sharing of this knowledge “defines a new threshold from which innovation starts once more”, as the Court has so elegantly stated.

Of course, the temporary monopolies granted by patents are seen by many as creating the undesirable effect of curtailing innovation.  This is particularly the case for patents which are very broad in scope and for patents that are deemed by interested parties as being obvious in nature.

The resolution of conflicts generated by the temporary monopolies and new inventions is the domain of patent litigation.  But along with being very costly, the system of resolution is far from perfect—so much so as to be fundamentally flawed.  This is to a great degree because the judges presiding over such cases usually do not have the qualifications to assess the technical merits of the arguments presented.  This puts these arbiters in a very uncomfortable position.

In practice as a case moves through the system, each side will trot out its expert witnesses to present the conclusive evidence that their respective side of the argument is valid.  How is the judge to make a decision?  In most cases, the judge doesn’t.  Judges typically exert substantial pressure on litigants to reach a settlement.  This creates a condition that highly favors the holder of a patent.

What is interesting about the KSR International Co. v. Teleflex Inc. et al. decision is that it potentially shifts the balance in the equation.  Companies accused of  infringement now have a stronger tool with which to defend against the action by directly attacking the validity of the patent on the grounds that it did not properly meet the non-obviousness requirement of patentability.  This is the element that makes this decision both very important and potentially alarming.

In the opinion, the Court refines the guidance for what constitutes obviousness.  The conventional interpretation of the obviousness has long hinged upon the notion that if the invention would have been obvious to a person of ordinary skill in the art attempting to solve the problem then the invention does not meet the non-obviousness requirement.  This meant that in order to invalidate a patent, it would need to be shown that there existed a teaching or motivation that would have made the invention obvious.  The Court has now made clear that the application of this yardstick has been too narrow.  In particular, the decision states the elements outside of the prior art must be considered in the determination of the existence of motivation—including market forces.

While this does acknowledge a reality of the inventive environment where it is certainly true that sometimes the market points toward a particular evolution of a technology, this creates a potentially dangerous situation in so far as the obviousness of an evolution in the context of market demand is not easily objectively measured.  We can all see that the current market conditions suggest the obvious inevitability of a new class of automobile that uses no petro-fuels but sacrifices none of the perceived benefits of conventional technologies.  However, this does not mean that the instantiation of a technology that satisfies this market need is neither trivial nor obvious.

Similarly, the Court has expanded the notion of relevant prior art.  The decision rejects the notion that prior art relevance is established based on the prior art being directly targeted at the problem that the current invention is intended to solve.  From a practical perspective this means that the level of inventiveness require to clear the non-obviousness hurdle has been raised.  Clever and novel application of out-of-domain knowledge, which has often been the hallmark of truly novel solutions, may now be argued as being within the reasonable grasp of the practitioner of ordinary skill.

The water is further muddied by the Court’s statement that the results of ordinary innovation are not the subject of exclusive rights under the patent laws.  This is being interpreted by some as a distinction between incremental and radical innovation.  The problem here is again that this distinction is highly subjective.  All innovations build upon the past and are therefore incremental to some degree.  So we have a need to define the level of innovative achievement that goes beyond the notion of ordinary innovation and the clear method to recognize that achievement.

From the facts of the case as they are presented in the decision, it does appear that the Court arrived at the correct outcome for the case at hand.  However, the Justices have at the same time created some instability in the system as the scope of the decision will only be clear after the body of case law develops to establish the standard of interpretation.

Innovation Orienteering

On his Innovate On Purpose blog, Jeffrey Phillips suggests that “Traveling Without a Map” is a serious issue for many organizations.  He states, “Management teams have not been specific enough about their expectations for differentiation, growth and change in their organizations.” Consequently, they struggle with selecting which of the many possible directions before them is the right choice.

Jeffrey is definitely on to something.  Many organizations don’t have good disciplines in place to translate corporate goals into clear criteria for evaluation of ideas.  In the absence of a strategic beacon to help plot a course, the organization is left without a way to steer clear of the shoals and find its way into the deep opportunities of the blue ocean.

Good innovation practice is not about generating 6000 ideas in the hope that one will mature into a successful product.  This type of innovation numbers game is a sucker’s bet.  If you have ever walked through a casino you have seen the slot junkies mindlessly feeding machines dollar bills, lured on by the occasional small payout and the stories of others hitting the jackpot.  This is how many organizations still pursue innovation.

Good innovation practice is not a numbers game.  The hallmark of good innovation practice is a well thought out approach to setting direction at each level in the process.

At the corporate strategy level, the goals of the company must be expressed as measurable attributes of any initiative.  These attributes should become part of the evaluation criteria of candidate ideas.

When considering how to address a specific market need, innovation teams should take the time to step back and ask what is the true goal of the exercise.  It doesn’t matter if the goal is an incremental objective such as correcting a design deficiency or a broad strategic objective such as projecting the right product offering for the evolved state of the market fifty years in the future.  Ensuring the team is focused on the right problem set is more than half the battle.  As Edward Hodnett said, “If you don't ask the right questions, you don't get the right answers. A question asked in the right way often points to its own answer.”

Once the team is focused on the right question, the process of ideation should be directed with metrics of assessment.  There are any number of possible dimensions of evaluation.  The precise set will be driven by your specific objectives for the product and for the company.  The injection of such a metrics driven approach will lead the innovation team inexorably toward an informed design process.

In the end, applying the repeatable innovation methods of goal-led ideation and informed design will lead to better innovation results.  Companies that practice these disciplines see their idea to product conversion ratios greatly improved.

3M’s Innovation Gene

The BusinessWeek Innovation and Design site published an interesting article on 3M and their struggle to find the right balance between efficiency, as represented by 6-Sigma, and creativity, as represented by 3M’s proud tradition of innovation.  Some would say that 3M is a highly visible example of a company grappling with the fundamental contradiction that “managers trained in Six Sigma, which aims to reduce risk and variability, have a difficult time embracing design thinking and innovation because they aim to raise risk and increase variability.”  There are certainly lessons of great interest to be drawn from 3M’s experience.  But I don’t agree with the assertions that quality programs like 6-Sigma are an anathema to innovation.

Let’s begin by clearing up an oft stated misconception: innovation seeks to increase variability.  This is not true.  Yes, product innovation often seeks to identify new variants of existing products.  However, the goal of that innovation is to arrive at specific well defined deliverables—not some hodgepodge of variable qualities.  Also, properly implemented sustainable innovation programs reduce risk.  The whole variability and risk discussion is a red herring.  The reality is that innovation programs and quality programs are orthogonal and completely complementary.

In my own experience, I have seen that it is possible to implement programs to improve effectiveness in both areas simultaneously.  I have done this to great benefit at the companies in which I have been a part.  At no time has the implementation of rigorous quality management systems been in conflict with the need to drive innovation.

So what was behind 3M’s experience?  Perhaps the answer is not so mysterious at all.  The BusinessWeek article points out that Mr. McNerney set out to change the company’s DNA.  While he may not have intended to eradicate the innovation gene, it would appear that this was the result.  The reason why this happened can be gleaned from the article, in the comments of Stephen Boyd and Art Fry.  Mr. Boyd states that 3M had inappropriately layered the traditional DMAIC 6-Sigma process over the innovation process.  He goes on to state that the approach didn’t really fit.  This is not surprising at all.  As has already been stated, quality programs are orthogonal to innovation.  As such, quality programs are not a substitute for innovation methods; they are just another aspect of the new product introduction process in which innovation and quality disciplines each have their own contributions to make.

Another interesting insight is provided by Mr. Fry’s comments about innovation being a numbers game.  Here we are given insight that 3M’s innovation approach was basically the “let’s throw a lot of ideas on the wall and see what sticks” method.  It is this that made 3M susceptible to the problem that they experienced in the end.  While 3M’s culture clearly placed high value on innovation, it would appear, from Mr. Fry’s comments, that 3M didn’t actually have an understanding of how to practice the informed design methods of repeatable innovation.  If 3M had had this understanding, the boundaries, as well as the points of synergy, between their innovation practices and the new 6-Sigma programs would have been clear.

It is ironic that 3M, one of the companies studied in Built to Last by Jim Collins and Jerry I. Porras, should stumble in this way.  As Collins and Porras put it, visionary companies are able to have their cake and eat it too.  These companies have found the way to break free of the tyranny of OR.  Here was 3M’s failing; they did not find the way to both manage predictability and continue their tradition of innovation.  Hopefully, they will get back on the right track under George Buckley’s management.

[Image Courtesy of the National Library of Medicine]