Innovating To Win

Innovation Brewing

Looking at the blog of Invention Machine’s CEO Mark Atkins, I am reminded that June is Innovation Month in New England.  There will be many fun and interesting innovation happenings throughout the region.  One of these is InnoBeer (short for Innovation Beer Summit).  When I organized the first InnoBeer event, I had no idea that it would become so popular.  Yet there have now been InnoBeer events in several locations in both the U.S. and Europe.

Recently, I had the opportunity to learn to make beer.  I joined a group of friends and together we brewed six varieties of beer.  There are innovation lessons to be learned from most things.  Here are some innovation lessons I took away from my beer making debut.

Science
There is science behind making beer.  Understanding what is happening in the process helps you achieve the desired results.  This is true for every domain in which I see people working in the trenches of innovation.  No matter what you are doing, there is a body of knowledge that precedes your efforts.  If you don’t have good access to this knowledge, you are destined to repeat the mistakes of the past and waste a lot of effort reinventing the wheel.  High performance innovation organizations understand the need to knowledge enable their innovation workers by providing them with the best, purposeful knowledge research and delivery systems.

Team
During our little beer making party, we brewed 6 varieties of beer in one evening (90 minute IPA, Summer Ale, Belgian Blonde, Vanilla Honey Porter, Oatmeal Stout, and Scottish Ale).  Getting it all done required teamwork and collaboration.  In business innovation practice this pressure to achieve high-value innovation outcomes with limited resources and time is de rigueur.   To achieve results requires the same type of committed and connected teamwork for innovation workers.  Companies seeking to maximize the effectiveness of their innovation workforce must employ innovation frameworks that connect people to one another when they need based on what they know.

Tools
Making our beer, we have at our disposal the right equipment to make the job easy and efficient: steam controlled boiling vats, wort cooling filters, automatic bottle sanitizers, etc.  Listening to others in our group recount the horror stories of making beer in their kitchens without these tools reminded me of what I see all too often walking into companies that have not begun to deploy state of the art innovation platform technology.  Innovation workers struggle to make sense of problems and find the fit between problem states and solution spaces.  Companies need to invest in providing their workers with the right tools and skills for innovation success.  Sure, you can start a fire rubbing sticks together; but why not give your teams modern torches and set them loose to burn up the competition.

Experience
Having the brew master watching over us made a huge difference.  He was able to tell us in advance what to pay attention to and how to ensure the quality of the final product we were producing.  Preserving, tapping into, and leveraging grey beard knowledge is a huge problem for many companies.  Make sure you have systems in place to harvest and disseminate this knowledge to empower your entire innovation workforce and enable the generational transference of your corporate tribal wisdom.

Immersion
My beer making experience was great.  One of the best aspects of the experience was its immersive nature.  While we were engaged in brewing or bottling, that was the focus of our activity.  There were no interruptions, no need to divert our attention and focus, no co-opting of resources by some other urgency.  Of course, we all have to deal with the realities of the real world when we are working in the trenches of innovation.  But, managers need to find the way to carve out protected time for innovation workers to focus on what’s important, not merely what seems urgent.  You have to willing to invest in your people, giving them the time to master and apply innovation best practices to their innovation tasks.  You will find this is an investment that will pay big dividends by both delivering the benefits of accelerated innovation and product delivery, but also greater per worker productivity.

The next InnoBeer tweetup is schedule for Tuesday, June 15th.  If you are in Boston, stop on by and join in the innovation conversation.  You can get details and sign up (free) here.

Finding Sense ( and Dollars) In The White Space

Spring is a time of change and transition, just right for reading a new book on innovation.  “Seizing The White Space” by Mark W. Johnson is the latest volume to come from Innosight, and seems to be right the right thing for spring reading.  It’s a highly readable and very quick to get through if your mind has already made the transition to summer; yet, it is has enough chewy content for those of us who are still want to curl up hearthside with an interesting book.

Johnson puts forth what he calls the four box business model to capture the dynamic tension between three key aspects of the value system underlying a business.  Yes, that’s right – four boxes to capture three key aspects.  These are:

Customer Value Proposition – What is it that customer derives value from when your offering is selected.  Of course, given the Christensen heritage of Innosight it comes as no surprise that Johnson returns to the job to be done jargon to talk about the value proposition.  Personally, I was just happy to see the value-prop called simply and directly what it is.  (Okay, I’m just weary of some authors who feel compelled to try and coin new jargon for what is already a well understood concept.)

Profit Formula – The strategy for monetization of the Customer Value Proposition.

Key Resources and Process – The things, people, and processes that are needed to deliver the Customer Value Proposition.  Johnson separates the concepts of resources and process in his representation.  Hence, the four boxes to represent three key aspects.

While these concepts may seem pretty basic, there are far too many companies that seem to forget that this system, and more importantly, the need to harmonize and balance these elements of the system exist.  Ignoring some of Clayton Christensen’s best advice (be patient on revenues, but impatient about profit) many companies attempting to claim a white space opportunity as their territory burn through loads of capital to try and drive the revenue engine only to dilute the share value so much that no one can hope to extract value from the venture.

Throughout “Seizing The White Space,”  Johnson uses many examples and comparisons of how these various elements interact in both successful and failed business models.  The examples help to bring to life what could otherwise be a very dry and boring domain of study.  You will need to filter some of the discussion through your analysis.  Some of the issues around the cases studies are open to interpretation.

After addressing the questions of when and how to look at business model innovation, Johnson reminds us of how existing demands and practice of a going concern can block the organizations ability to define and implement a new system to attack a white space opportunity.

I enjoyed “Seizing The White Space” and certainly recommend it as a worthwhile read for innovation practitioners or managers responsible for considering, planning for, or executing on new business platform opportunities.

This is the fifth stop on a virtual book tour for “Seizing The White Space.”  Earlier stops on the tour can be visited at:

Working Knowledge – Andrea Meyer’s excellent blog

Blogging Innovation – A multi-author innovation blog maintained by Braden Kelley

Innovate on Purpose – Jeffrey Phillips thoughtful blog on innovation strategy and practice

FastForward Blog – An Enterprise 2.0 blog where Jim McGee review the book 
 
Yet to come on the virtual book tour is Dan Keldsen’s interview with Mark Johnson which will appear on the  Information Architected blog.

Boyd on Linking Strategy and Innovation

I read a nice post on Drew Boyd’s blog, Innovation in Practice, discussion the idea of linking innovation with company strategy.  In it, Drew discusses two models of interaction between company strategy and innovation:

Strategy informs innovation – in this model the company defines a strategy, then innovation efforts are pursued to find way to deliver on and enhance the value of the strategy;

Innovation informs strategy – in this model, innovation activity first generates scads of potential concepts which are subsequently mapped to a strategic evaluation model to select the innovation path that builds the optimal strategy.

Whichever approach you select, it is critical that your corporate strategy and innovation efforts are aligned.  Without alignment, you have no chance of achieving the level of execution required for successful innovation delivery.

However, I would like to highlight a third model: Innovation and Strategy inform each other.  In other words, you are only looking at half of the picture if the dialogue between strategy and innovation is a one way exchange. 

If you are responsible for strategy, you don’t want to lament “Gee, if I’d only known that was an option I would have set that as a strategic goal.”  As an innovation practitioner, you hate saying “Gee, if I had only known that was important, I could have helped achieve that objective.”

Optimal value is achieved through an on-going dialogue between these two drivers of corporate value.

Innovation Chickens and Eggs

Just before I left for my end of year holiday, there was an interesting post on Bruce Nussbaum’s BusinessWeek NussbaumOnDesign blog.  It mentioned a recent statement by Don Norman, a key leader in Design, in which he had stated that innovation is driven by technology and science rather than design’s focus on peoples’ needs.  This initiated an interesting discussion that even saw Don Norman weighing in.

I suppose that I should be pleased by such a pronouncement.  After all, my own background is from the science & technology side of things, and more than once I have found myself annoyed by thick-headed design bigots espousing fanciful ideas about design being the only thing that matters or that innovation cannot be planned.  But on the contrary, I find that the esteemed Mr. Norman is wrong.

Does that mean that it is design that drives innovation?  No.  Rather, science & technology and design are two equally important ingredients in successful, sustainable innovation.

Strangely in his comment on Nussbaum’s blog, Norman makes the rather absurd claim that need follows the existence of technology.  Looking at the examples cited, it is easy to see how laughable this argument is.  Norman states, “The need for communication devices (telegraph, telephone, radio, cellphone, internet, postal mail, email) came after the technologies made them possible.”  I doubt that Norman can be so naïve as to thinks this is a credible statement. 

The need to communicate existed before and independently of the vehicles of communication.  As human social conditions evolved, so too did the demand for communication efficiency evolve along various measures.  People made due with the technologies available because they did not imagine that alternatives could be available.  At times, these limitations placed constraints on other aspects of societal evolution.  Naturally, the science and technology needed to enable new modes and models of communication evolved to meet the latent need.  These technologies were not adopted because they existed, but because the need existed to drive the adoption.  The fact that no one stood up and said, “Boy, a Blackberry would sure make my life easier,” in 1950, does not imply that the need case for the device did not exist.

Yes, it is sometimes very difficult to identify the latent need before it is expressed.  But, it is there.  Yes, the enablement of a solution requires the science & technology foundation to make the solution possible.  But, absent a need, the invention is little more than a curiosity.

Successful innovation responds to a need (design influence); successful innovation delivers a novel solution (science & technology influence).  Design leads us to understanding how to marry capability to need in a way that creates value; the language of capability is defined and expanded through invention in science & technology.  Thus, it is that the intersection of design and technology is the wellspring of innovation.

Driving Growth Through Innovation

As I was perusing Chuck Frey’s Innovation Weblog this morning, I noticed a recent post by Charlie Alter titled “Demand innovation step 3: Finding new growth opportunities.”  In this article, seven principles are highlighted.  As I pondered the points, it struck me that the advice put forth in this article was actually pretty poor.  Let’s dissect the suggestions made by Charlie Alter and understand what a good innovation driven growth strategy should look like.

Alter: “Shift from a “Product Centered” sales growth strategy to an “Economic Centered” model”
 
Better Advice:
Customer/Market Centric innovation is the most effect path to growth hands down.  Focusing on the term Economic Centered can lead to serious problems for a company.  The last thing you should want to do is get sucked into the vast gaping void of commodity hell.  Yet, this is exactly where you will end up if you make economics the central piece of your innovation strategy.

The keystone supporting the architecture of your business and innovation strategy must be value.  It is the value proposition that gets customers to buy; it is highly differentiated value that drives market share attainment; it is tight full product value alignment that builds customer affinity.

This high value delivery is achieved by immersive understanding of the opportunity space defined by your target customer’s unspoken needs, goals, and aspirations.  While Alter does acknowledge this, the emphasis on economics is wrong.  The focus must always be on the customer.  Customer focus leads to high value delivery.  Deliver high value and the economics will follow.

Alter: “Stop relying on developing the latest blockbuster products and develop a series of evolutionary”

Better Advice:
Sorry, if you want to be the leader, you can’t pick between ‘Big I’ and ‘little i’ innovation.  The only winning game plan is to pursue both.  Strategy and tactics are two sides of the same coin.  The evolutionary innovations that provide incremental value enhancements to your existing customers are very important.  It is these everyday innovations that sustain the value of your existing revenue channels, help ensure the ongoing profitability of the business, and can provide the cash needed to fund new opportunities.

However, becoming reliant on incrementalism is a go out of business strategy.  It is this mindset that creates the environment for disruptive market change.  By focusing too tightly on the current needs of today’s best customers, companies become inured to the constantly changing market/customer ecosystem in which they operate.  They stop changing and developing.  In an ever changing world, when you stop changing, you start dying.

Learn to eat your own lunch before someone else does.  In parallel with the incremental innovation, companies must engage in continuous reevaluation and innovation of their products, their services, and themselves.  It can be scary to think of creating a new product that may undermine an existing cash cow.  But always remember that someone is going to do it.  Isn’t better if that someone is you?

Look for new markets, too.  You can tap into vast new revenue opportunities and extend the revenue life of your current products by applying simple sustainable innovation practices.  Can you identify new communities of users for your existing product?  What is the fundamental component of your offering that is the source of its value?  Can that component be retargeted to a different space where it can enjoy a second revenue identity?  Are there licensing opportunities to be had?

It is these two approaches, self re-invention and white space development, which should be at the heart of your strategic innovation thinking.  With the dual tracks of tactical and strategic innovation, you will ensure both the short-term and long-term success of your company.

Alter: “Look at the size of your business, no matter how large or small, for the advantages it represents”

Better Advice:
It is always import to look at the elements of your business and consider how they can be leveraged to competitive advantage.  But never try and justify the status quo by focusing solely on the positive.  Every aspect of your business, its size, your organizational design, your sales mechanism, etc., presents both advantages and disadvantages.  You need to understand both sides and consider how to optimize each element of the whole to deliver maximum customer value and corporate performance.

Taking the specific issue of organization size as an example, don’t assume your current configuration is the right one.  Does your size and organization really fit the optimal business model for your market and target customers?  The answer to this question may change the way you think about the business.  You might find you need to grow the organization to map properly to the business model and growth goals; perhaps you will find that you have excess capacity that must either put to a value driving use or trimmed out.  You might even come to the realization that a fundamental shift in the business model is important.

Alter: “Make sure profitable growth is driven through every level of your company”

Better Advice:
On this point, I fully agree with Alter.  Every company must maximize its return on investments.  Every dollar (Euro, Pound, Yen, etc.) which is misspent detracts from that attainment.  As Charlie advises, do redirect those wasted resources into activities that can drive revenue and value growth for the company.  This is as true for a start-up as it is for a major enterprise.  As Clayton Christiansen put it, “Be patient on revenue, but impatient on profitability.”  One doesn’t have to look far these days to see the wreckage of start-ups that became proof points for this when their venture capital partners decided to turn off the funding flow.

Alter: “Develop lots of small or even maverick ideas for growth rather than a few large ones”
        “One simple rule is that the more ideas for growth the better”

Better Advice:
More is not always better.  Contrary to the popular mantra that you need to throw as much stuff against the wall to see what will stick, the go generate a ton of ideas approach to innovation is counterproductive and a legacy view of the world that tenaciously hangs on because sometimes something does in fact stick.  When you have too many ideas to wade through, the sea of ideas itself becomes the roadblock to innovation.

Companies have limited resources and cannot afford to waste cycles winnowing down a mountain of questionable and mostly incremental concepts looking for that one gem.  Rather than letting a million flowers bloom and die only to find that in doing so they have depleted the nutrients in the once fertile ground that was your business, you are much better off selecting a handful of high quality ideas that have a much better chance of success because you can properly focus your energies on tending the innovation garden.

This is fundamentally where needs led innovation diverges from the old school thinking of idea first innovation.  By clearly identifying the target audience, their needs, and then applying sustainable innovation methods to find the best way to deliver value to that audience through a brilliant solution that meets the needs, you will have the surest path to corporate value creation.  In short, you don’t need 3000 ideas to create one new product, you just need one.  Sustainable innovation practice is all about identifying the one idea the first time.

Alter: “Form a small cross-functional team and visit your best customers to determine what types of challenges and problems they encounter during their business processes that “surround” the products or services they buy from you”

Better Advice:
On the surface, this is basically good advice.  Understanding the entire use model and eco-system that your product or service is a part of can help you develop many good strategic insights.  However, always remember the limitations of your current customer experience.  Today’s best customers may not in fact be tomorrow’s high value customers.  Be wary of the pitfalls of steering the future course of your enterprise by always looking in the rearview mirror.

Do pay attention to your top customers, as they can help you understand the requirements for on-going incremental innovation as well as give you insights into easily entered adjacent markets.  But don’t neglect your underserved customers.  Understanding their issues can give you insights into vulnerabilities that could be exploited by a disruptive agent.  Also remember to listen to all the voices of innovation: the voice of the customer, the voice of technology, the voice of regulatory influence; and the voice of your business.  When you can properly harmonize these different voices, you are properly orchestrating the business strategy for innovation.

More Than Meets the Eye

On his blog, Thirty Minutes from Andromeda, my friend Jim Belfiore writes about Michael Jackson.  But Jim’s post points out a side of Michael that goes beyond the iconic King of Pop image.  Did you know Michael Jackson was also an inventor?  Check it out on Jim’s blog.

Of course, there are many celebrity inventors.  We come to see people through the lens of persona and tend to forget that people are often more complex than what we see from the outside.  Here are some of my favorite examples of people we all know who have also made their mark as inventors.

Gary Burghoff: US Pat No. 5,235,774
Still waters run deep.  Many of us remember Gary as the quiet, wide-eyed “Radar” O’Reilly of MASH.  However, Gary also created a chum dispensing device to attract fish.

Jamie Lee Curtis: US Pat No. 4,753,647
Who knew the daughter of Tony Curtis and Janet Leigh was so clever.  Here she describes an improve diaper with a sealable pouch for clean-up wipes.

Samuel Clemens: US Pat No. 121,992
The iconic American writer and humorist known as Mark Twain patented three inventions.  This patent describes an improved adjustable clothing strap.

Zeppo Marx: US Pat No. 3,473,526
The youngest and perhaps underappreciated of the Marx brothers, Zeppo appeared in the first five of the Marx brothers’ films before he went his own way as an agent.  However with the patent, we can see Zeppo’s range was quite broad.  This patent describes a device for monitoring cardiac pulse rate.

Paul Winchell: US Pat No. 3,097,366
As a child watching Paul Winchell on television, I had no idea that besides being a great ventriloquist he was also a prolific inventor.  He has loads of patents to his credit covering a broad array of subject areas.  This one is for an artificial heart.

Abraham Lincoln: US Pat No. 6,469
Abe has always been among my favorite US presidents, but he is also my favorite celebrity inventor.  In this invention, Lincoln describes a system to add buoyancy to river barges.

Innovation Chess

When I’m not deeply engaged in innovation, I enjoy chess.  Earlier this year I started a chess blog as part of my own chess self-improvement plan.  Well, I got a comment last week reminding me that I have not posted on my other blog in a while.  Oops!  Of course, my CEO is delighted by this because he feels the more my game suffers the more the business thrives.  He may be right -- especially these days.   While the business is doing great, it does take more care and feeding in the current economic climate than in the past, a fact which is reflected in my work schedule.

Of course this extra attention to the business of innovation doesn’t mean that I don’t get the chance to practice chess thinking.  There are many parallels between the worlds of innovation and chess.

You can only see so many moves ahead
There are many factors that influence the business situation, and you will never have full visibility to all of them.  Because of this, you can never make plans that will not need adjustment over time.  This doesn’t mean you shouldn’t plan; you absolutely must.  However, you need to be reviewing the situation on a regular basis and determining if your plans are still the right ones.  Are the market conditions still the same?  Is the breakthrough you had been considering still relevant?  Is a competitor changing the landscape?  Is there a disruptive threat emerging just over the horizon?

Strategy and tactics are equally important
A grand plan poorly executed is just as ineffective as a bunch of activity that is not aligned around a plan.  It seems pretty obvious, but I have seen many people fail at innovation (and chess) because they focused solely on one dimension of execution.  This is a fundamentally flawed approach.  Strategy and tactics are like the yin and yang of innovation.  They balance and play off of one another.  You need to have a vision of where you want to go if you plan to get there.  You also need to have the innovation skills needed to navigate the path to where you want to be. 

Bring your whole game, or go home
Innovation and chess are merciless to the uncommitted.  There are many skills that you must bring to the table in order to deliver on successful innovation.  If you have a weak point in your game, you will be punished for it.  It’s not enough to have an idea—ideas are cheap.  The difference between winning and losing in innovation is realization.  Are you engaging your entire value delivery network to maximize the potential of your innovation efforts?  Are you employing innovation best practices to ensure that you are delivering the optimal manifestation of your concept to the market?   Is your innovation process enabled to achieve this best deliverable in the most efficient manner?

Think proactively not reactively
Play the game actively.  Whether in business or chess, it’s never comfortable when your competition has the momentum.  Turn the tables by putting the completion on the defensive.  Futurist Daniel Burrus advises to identify your most urgent issue and skip it.  On the surface that may sound odd, but there is great wisdom in this suggestion.  Your most urgent issue is usually a response to yesterday’s problem.  By the time you respond, you are already too late.  The cost of that late response was the opportunity to get ahead of the curve by creating the game-changing innovation that will put you in front of the pack.

Practice makes perfect
When you play a lot, your game gets sharper; when you haven’t played in while, you feel rusty.  For companies that plan to succeed at innovation, the message is clear.  You can’t expect to resuscitate your innovation capabilities when you feel an urgent need.  You must build a sustainable innovation program that makes innovation practice a part of what you do every day.  People are examining issues all the time.  Every one of these issues represents an opportunity to reinforce the skills of innovation.  Provide the culture, the process, and the infrastructure so that your workers can hone their innovation capabilities, and you will see significant improvements in the value creation achieved by your organization.

As you can see, chess and innovation are very similar.  Regardless of which arena you are in, my best advice is always play to win.

Innovation Tips from Guy Kawasaki

In the Art of Innovation, Guy Kawasaki discusses 9 tips for innovation.  The post gives some good pointers to approaching innovation.  To summarize Guy’s points, innovation requires vision, tenacity, flexibility, customer orientation, and a splash of audacity.  Take a look at the post here.

Innovation With a Yes We Can Attitude

Recently, I heard someone saying: “Innovation isn’t about saying ‘yes’, it’s about saying ‘no’ to everything but the most essential features.”  At the time, I quietly thought to myself that this person just didn’t get it.  Today, Seth Godin has reminded of the comment with his post on “Looking for yes.”

Innovation is all about delivering value to a customer.  At the core of this is the notion of saying YES.

YES, I can make possible for you what others have not.

YES, I can improve your experience and lower the cost to you at the same time.

YES, I can not merely meet your basic requirements, but I can also delight you not by exceeding your expectations, but by redefining them.

Of course, it is important to say yes to the right question.  This is why the first step of any innovation initiative must always be to understand your customer, your market, your product, and your capability.  By listening carefully, you can identify the true, unmet need that your customer has and be able to map your innovation goals to filling the job the customer will hire your product to perform.

Having this focus on customer needs and aspirations will allow you to say yes to innovation and not waste time saying no to things that aren’t relevant.

Two Years of Innovation Blogging and Counting…

Innovating To Win is two years old today!  It’s hard to believe, but after 238 posts on a broad range of innovation topics, here we are.  It has been great fun thanks to all of you who read this blog and engage in the conversation via comments, trackbacks, or private emails.

I’ve been trying to update the site recently with some new formatting and features.  The latest is the post rating feature which I hope you’ll make use of so that other readers can see which articles you found useful and interesting.

In the coming weeks, I will try and get around to retagging the content with more categories so that it is easier to find stuff.  (Yes, I’ve been procrastinating on this task.)  Combined with the other recent changes, I think this will make it much easier to navigate to useful information.

I am looking forward to the next two years.  Now, if I can only find the time to write all the posts I have in the mental queue.

Thanks for your support; thanks for reading; and thanks for the feedback.