About this Author
Gwen Smith Ishmael, Sr. Vice President of Insights and Innovation at Decision Analyst in Arlington, TX, has led marketing and new product development activities in the CPG and technology industries since 1986. She also conceived and developed ground-breaking Web-based promotional vehicles, two of which are patent pending. Gwen holds an MBA in Marketing and is a featured speaker on insights and innovation around the world. Her writings have been featured in international text books, most recently in Managing 4 Ps of Marketing FMCG Sector, and Product Innovation: A Strategic Tool for Growth, by ICFAI Publications, 2006 and 2007, respectively.
Founding Author
Renee Hopkins Callahan started IdeaFlow and serves as chief blog-wrangler. She is Director of Innovation Services at Decision Analyst in Arlington, Texas, is a former journalist who worked as an editor and reporter for The Dallas Morning News and the Nashville Tennessean, and was managing editor of D, the Dallas city magazine. She has a master's degree in rhetoric and has also taught college-level English and informal logic.
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Category Archives
April 17, 2006
Posted by Renee Hopkins Callahan
Egils Milbergs of Accelerating Innovation has posted on IBM's Business Leadership Forum, held in Rome in early April. His post included a this quote about technology and innovation:
"Technology plays a leading role in innovation, but it isn't the only factor. What were once disruptive technologies now are commodities. Technology can be the establishing base for innovation, but people are the ones that drive it forward. Technology is really only the mechanics of the process. Real innovation is about great people generating and then implementing new ideas."
Granted, I like this quote because it reinforces what I believe about innovation. But I also like it because of the recent research I've done on innovation drivers. A long-ago conversation on IdeaFlow featured a debate on what actually drives innovation, and a great many people were insistent that it all comes down to *people*. I agreed then, but still saw the value in talking about what specific conditions of possiblity were driving those people who were driving innovation.
This quote about technology and innovation to my mind puts technology where it should be -- in the hands of people who can do something useful with it.
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+ TrackBacks (0) | Category: Technology
December 17, 2003
Posted by Renee Hopkins Callahan
Sorry for the recent quiet...a weeklong business trip with bad connectivity plus some difficult personal issues plus the holidays equals blog silence. Catch-up mode starts now!
First -- Here's an interesting story from Technology Review via Corante’s Venture Capital news section:
The problem in the tech sector is not a lack of innovation -- it is the inability to commercialize innovative new ideas, according to Kenan Sahin, a successful entrepreneur and alumnus of MIT and Bell Labs. In other words, "The flow of new innovations has remained strong and unabated over the past few years. It's the mechanisms for implementing them that have eroded." The article analyzes the so-called 'innovation backlog,' warning that "vast numbers of potentially important advances [are] being warehoused or shelved." As long as the "innovation-to-implementation flow is out of sync, the consequences for our work force, our wages, and our standard of living are serious. Unless we act decisively, it could be very difficult and costly to restart and resynchronize the flow."
My take -- sounds to me like this is a very strong argument for the kind of open innovation espoused by IdeaFlow bloggers Henry Chesbrough of Haas School of Business' Center for Technology Strategy and Management and John Wolpert of IBM.
My experiences this fall at two innovation conferences and one PDMA-sponsored new product development conference have indicated that not everyone involved in corporate innovation is signed on to this agenda, however. In general, I've found that the people who go to conferences organized around a theme of "innovation" seem more open to this idea than people who go to conferences organized around a theme of "new product development."
This could be due to differences in seniority -- more top-level managers at the innovation conferences and more product-level managers and R&D folks at the new product conferences. But that shouldn't matter, if you believe as I do that the push for innovation needs to be company-wide.
John Wolpert made a very good point at the recent Return On Innovation conference: There seem to be two camps regarding innovation -- those who view it as something of a religion, a state of mind, a way of thinking that can't really be measured very well, and those who view it as a process that can be predicted, managed, and measured in order to result in new business models, business processes and products that will increase growth. The truly successful innovators, I believe, will be those who can embrace both of these kinds of thinking about innovation.
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| Category: Conferences | Open Innovation | Technology
December 9, 2003
Posted by Renee Hopkins Callahan
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| Category: Commercialization | Creativity | Customer Viewpoint | Innovation, General | Marketing | New Products | Technology
November 26, 2003
Posted by Renee Hopkins Callahan
In previous chapters, The Innovator’s Solution authors Christensen and Raynor explored a disruptive strategy of “competing against nonconsumption.” But in so doing, companies are faced with the immediate challenge of how to find and sell to the nonconsumers who can become your customers. A case study with which many of us are familiar — how Sony scored numerous times with disruptions such as the transistor radio and the Walkman — illustrates the point perfectly.
The Sony case also illustrates another point made in this chapter, which is that disruptive products often require disruptive channels for sales and distribution. This point is even more pertinent when you use the broader definition of channels that the authors are using: “A company’s channel includes no just wholesale distributors and retail stores, but any entity that adds value to or creates value around the company’s product as it wends its way toward the hands of the end user.” Example: computer makers such as IBM and Compaq are the channels through which Intel’s microprocessors and Microsoft’s operating system reach the end-use customer.
So if a disruptive strategy of “competing against nonconsumption” makes so much sense, the authors point out, why do incumbent companies do the opposite, which is “trying to stretch the disruptive innovation to compete against — and ultimately supplant — established products sold by well-entrenched competitors in large, obvious market applications”? The answer has to do with resource allocation.
Mistake No. 1 is to frame the disruption as an opportunity. Christensen and Raynor’s theory (much of which they credit to HBS professor Clark Gilbert) is that the disruption should be framed not as a potential opportunity for further growth, but as a threat to existing business that cannot be overlooked. Framing the disruption as a threat allows for top-level resource commitments. Then the disruptive technology should be developed by an “autonomous organization” (another division, a spin-off company) that can frame it as an opportunity.
Mistake No. 2 is to promise big numbers in the future in exchange for resources in the present. “The very effort of trying to articulate a convincing case for resources actually forces the entrepreneurs to cram the innovation as a sustaining technology in the existing market,” because the biggest markets whose size can be substantiated are those that already exist. Then when the results fall short of the promised numbers – because the market of nonconsumers is not being effectively targeted – resources are cut.
The authors suggest that companies that try new-market disruption establish a parallel process in which to evaluate potentially disruptive opportunities, a process in which the go/no go decisions are made based not on numerical rules but on how well they fit the pattern for disruption already explicated by the authors. And even then, the best that can be predicted is that “the initial conditions are conducive to successful growth.”
Disruption is, after all, still a risk.
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| Category: Books | Clayton Christensen | Commercialization | Customer Viewpoint | Innovation, General | Marketing | Marketing Research | New Products | Technology
November 19, 2003
Posted by Renee Hopkins Callahan
Back to Innovator’s Solution – Chapter 3, “What Products Will Customers Want To Buy?” is one that hits close to home for me, considering the business my team is in (and our company). But there’s a disappointment on the first page of the chapter: “Over 60% of new product efforts are scuttled before they ever reach the market, and of the 40% that do see the light of day, 40% fail to become profitable and are withdrawn from the market,” says Christensen. The disappointment isn’t just that the failure rate is high, but that the numbers are sourced (in one of those wonderful endnotes!) from a 1996 publication – the book Wellsprings of Knowledge by Dorothy Leonard (actually, the endnote says the book was published in 1996; Amazon says the hardback came out in January 1995 and a paperback version in 1998). In client presentations we’ve been using similar numbers that we’ve sourced from a 1998 Dun & Bradstreet study, but it’s disappointing to find even older numbers in a hot-off-the-press book.
In any case, Christensen points out that though the new-product failure rate is high, “failures are not really random.” They are a result of the difficulty of the task: How to connect disruptive innovations with the right customers to create a foothold in the market, then grow profitably along the sustaining trajectory. And identifying those disruptive footholds means “connecting with specific jobs your customers are trying to get done in their lives.”
Interesting discussion about market segmentation, which he defines as the “categorization stage of theory building.” And here’s correlation vs causation again – according to Christensen, “attribute-based categorization of either/both products or customers can reveal correlations between attributes and outcomes…but only…circumstance-based categorization (ie., segmentation schemes) tell causality – what features, functions, and positioning will cause customers to buy a product.
In other words, customers “hire” products to do specific “jobs,” so it’s best to segment the markets to mirror the way customers experience life. The critical unit of analysis is the circumstance, not the customer, which to me suggests qualitative, not quantitative, research. My instincts tell me this is right. And it actually also “fits” with the way we already structure our ideation projects, so that makes me all the happier about it!
Bottom line: One disruptive strategy is to compete against “nonconsumption” for “nonconsumers.” Traditional quantitative market research won’t identify these folks or the jobs they are trying to do. The best way to determine this market is to observe what people seem to be trying to do, then ask them about it. And only after you have identified those needs would you then move into quantitative research to determine the size of the market. Until you know what’s needed, you can’t figure out how many people might have that need.
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| Category: Books | Clayton Christensen | Customer Viewpoint | Marketing | Marketing Research | New Products | Technology
November 7, 2003
Posted by Renee Hopkins Callahan
A lengthy power outage at my hotel today kept me away from blogging, but it's been resolved now, and so on to Chapter 2, which I read on the plane yesterday.
Here's another one of those counterintuitive statements that, once you think about it, seems perfectly obvious -- "Few technologies or business ideas are intrinsically sustaining or disruptive in character. Rather, their disruptive impact must be molded into strategy as managers shape the idea into a plan and then implement it." Those who would argue for a process view of innovation already understand this. Innovation is relative to the context in which it occurs.
And even the type of innovation is contextually relative -- "an idea that is disruptive for one business may be sustaining to another."
This chapter also introduces a third contextual dimension to the disruptive innovation model introduced in Dilemma. In this dimension lie the contexts of consumption and competition that give rise to two different kinds of disruptions -- new-market disruptions in which the new technology, service, or product is aimed at introducing new people into the market, and low-end disruptions that attack the least-profitable and most overserved customers.
I still love the endnotes in this book. Check this out from page 70, in a long note pointing out how wrong people were who complained that Dilemma was flawed because sometimes an industry leader manages to avoid being killed by a disruptive competitor. The authors' response: "When we see an airplane fly, it does not disprove the law of gravity."
Links to Innovator's Solution resources
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| Category: Books | Clayton Christensen | Innovation, General | New Products | Technology
November 4, 2003
Posted by Renee Hopkins Callahan
My blog post on Chapter 1 of the IS drew this response from Mark Federman’s What Is The Message? blog. You’ll want to read his entire post – it’s thoughtful, and it’s the first one I’ve seen that’s negative about this book. I’ve added a link to his post to the IS book resources. Here is my response to Mark:
Actually, I totally agree that "business people who attempt to adopt his [Christensen's] principles as gospel do so at their peril." I believe this is true of *any* set of principles. There is *no* business gospel. That's why I spend so much time reading, reading, reading.
You also say that "predictability does not necessarily come from well-researched theory if the process itself is non-deterministic and chaotic." Assume that you are right, and that the processes by which disruptive innovation happens *are* by and large non-deterministic and chaotic. So do we then throw up our hands and say the process -- what's in what Christensen calls the "black box" of innovation -- just cannot be controlled, so let chaos rule? What do we do then?
This is addressed by Christensen in this endnote to Chapter 1 (p. 25): "Ultimately, innovators must judge what they will work on and how they will do it -- and what they should consider when making those decisions is what is in the black box. The acceptance of randomness in innovation then, is not a stepping-stone on the way to greater understanding; it is a barrier." I'm reading that to say *not* that there is no randomness in innovation -- but that to focus a study on innovation on that randomness isn't productive.
You also say, "The outcome of a process is often an emergent property; Murphy's Law (and its many corollories) have almost become business axioms in a complex environment in which predictable determinism has been obsolesced by our increasing understanding of the nature of complexity." To my mind, there's a lot of space between "predictability" and "determinism," and it's in this space that Christensen and Raynor's theorizing fits.
Finally, you say "It is awareness, and not theory or predictions, that are the key to business success." Awareness of what, actually? Surely awareness of that which can be known codified and categorized about the innovation process is a helpful thing. This can be studied, and in fact is what Christensen seems to me to be trying to do. I'd say we need that in addition to, not instead of, an awareness that there are some things about the innovation process that cannot be predicted. We need both for business success.
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| Category: Books | Clayton Christensen | Innovation, General | Technology
October 28, 2003
Posted by Renee Hopkins Callahan
John sent this link to a videotape of the 10-minute speech he delivered on Oct. 15 to the Australian Parliament and 250 scientists at the Parliament Building in Canberra. When you follow the link, John is the "First Presenter." The "Final Speaker" link goes to shows a senior official commenting on the concepts from the speech. John's specific topic: how to accelerate corporate innovation, what we can do to build national economic growth by bridging barriers between firms, and how "intermediated innovation practices" might work.
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| Category: Bridge Project | Commercialization | Innovation, General | Open Innovation | Technology
October 25, 2003
Posted by Leslie Martinich
The Wall Street Journal carried an article on their front page today about the Department of Justice’s examination of the National Association of Realtors’ Internet policies. My friend Russell Capper’s company, eRealty, as well as other Internet-based real estate companies are challenging the way real estate business is done.
Why is this interesting? Not just because Russell is a friend of mine! It is interesting because it exhibits classic symptoms that almost all innovations display, primarily resistance and fear. Of course realtors do not want to see their business move to an electronic model, but it is only a matter of time before much of the real estate business is done through the Internet.
The most analogous industry is airline ticket sales. Travel agents didn’t want to see their business move to the Internet either. But end users want to do their own searching, identifying the flights they want to purchase. Some of them still want the services of a travel agent.
The move of the real estate business to the Internet is simply slower because users trade real estate far less frequently than they purchase airline tickets. But ultimately it is customer demand that will force this industry to move more completely to the Internet.
The activity of the Department of Justice points out another classic issue for innovations. A society’s flexibility enhances its ability to prosper from innovations. That is why countries with common law systems are more prosperous than countries with civil law systems. Attempts to make rules arbitrarily constraining innovations is not a good thing for prosperity.
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| Category: Commercialization | Innovation, General | Law & Policy | Open Innovation | Technology
October 23, 2003
Posted by Renee Hopkins Callahan
Well, now we know why we haven't heard much from John Wolpert lately. He's been in Australia, busily spreading the Open Innovation gospel. He surfaced today long enough to email us a link to an interview he did with the ABC radio network (the Australian equivalent of NPR). While in Australia, John also addressed the Australian Parliament and the Innovation Exchange about Open Innovation. When he gets back we'll twist his arm to get him to post some of his impressions!
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| Category: Bridge Project | Commercialization | Innovation, General | Law & Policy | Open Innovation | Technology
October 22, 2003
Posted by Leslie Martinich
The IEEE 2003 International Engineering Management Conference will be held November 2-4 in Albany, NY. The IEEE-IEMC 2002 was one of the most useful conferences I attended last year, and I'm expecting another great conference this year.
Speakers include Dr. Rolf Smith speaking on "Diffferent Thinking for Diffferent Results." The conference organizing committee chair is Dr. Lois Peters, one of the authors of Radical Innovation: How Mature Companies Can Outsmart Upstarts, a book that both John Wolpert and I found to be extremely useful.
I'll be giving a workshop, "Unleashing Creativity: Creating an Innovation Focus for Engineering Teams." The workshop will include a discussion of an Innovation Framework as well as the use of InnoMediaries, citing work from both John Wolpert ("Breaking Out of the Innovation Box") and Henry Chesbrough (Open Innovation).
Talk about convergence!! Lots of our ideas will be coming together here!
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| Category: Conferences | Creativity | Innovation, General | Open Innovation | Technology
Posted by Leslie Martinich
What are some of the ways that organizations can foster creativity? There are lots of ingredients; I'll focus on just one in this post. This is one that worked well for me when I was managing a software R&D team many years ago.
I keep a book of logic puzzles on my bookshelf. Two that I recommend are Raymond Smullyan's What is the Name of This Book?, and his more recent The Riddle of Scheherazade: And Other Amazing Puzzles. Smullyan is a logician and set theorist, whose logic books I used in college, and his puzzles provoke some opportunities for clever thinking.
In those informal moments when a few engineers would gather in my office, we would pick up the book and choose a puzzle. We'd consider it as a group for a couple minutes and then go off on our own.
The following day we would discuss each of our solutions. I am very pragmatic, and I would typically find one solution and be done with it. Another person in our group would often return with three solutions and a proof for their correctness! He and I had very different approaches, each of them useful for certain situations.
The results? Over time, we developed a good sense of each others' strengths and ways of approaching problem solving. We had fun. And we developed a strong respect for others' thinking.
And we could solve a lot of logic puzzles!
This is a simple, informal practice that, over time, enhances a group's creative output. There are lots of other such practices. Send me your favorites!
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| Category: Creativity | Technology
October 13, 2003
Posted by Renee Hopkins Callahan
If you're not too conferenced out yet, Naomi Moneypenney of ManyWorlds.com gave me permission to share her notes from the recent Emerging Technologies Conference:
Just thought I'd share a few thoughts about the ETC conference at MIT that happened last week, pertaining to innovation and creativity. Speakers included Jeff Immelt, Michael Dell, Bob Metcalfe, Leroy Hood, Rodney Brooks and many other luminaries.
It was great to see the renewed focus on innovation, even from big companies like GM, Pfizer and Intel, though the word 'innovation' did not crop up that much it was core to their new directions.
Nathan Myhrvold had some great ideas on setting up Idea Factories so that people who are great at inventing could just invent, and sell 'ideas' that others could make and sell. Though this seems unrealistic, and the patent systems of our government would probably crack under the weight of a number of idea factories, it does seem a logical progression.
Technology innovations were of course at the fore. And most strongly in pharamceuticals, healthcare and fuel technologies. Interestingly many 'new' innovations had come from two sources: 1) Recombining ideas or products from other sources (like already appproved medications) or building on research inventions; 2) Opening new markets with existing products used in a new way.
I saw less 'step-change' ideas, and more 'incremental' innovation.
I summarized a few trends for the ManyWorlds.com newsletter to subscribers and I'll repeat them here:
- Idea Factories: Leave invention to those who are best at it. Nathan Myhrvold's perspective may not be for everyone, but he argued strongly for specialist firms that do nothing but invent, leaving others to manufacture and market the inventions.
- Reinvent Venture Capital: In line with the previous trend and the failure of so many innovation stage-gate processes or funnels in large companies, the venture capital industry is overdue for a major shake up.
- Learn from Biological Systems: Evolution has had the benefit of millions of years of experimentation. Whether in genomics, nanotechnology, cutting edge work in materials science or using biological algorithms to study social networks or personalize medicines, learning from living systems is a great way to bootstrap our understanding.
- Combinatorics: Once an obscure term in math textbooks, combinatorics is just a fancy word for the process of recombination. No longer bound by mere
network effects(!), recombining ideas, people, products is the way of the future. Indeed, the award for top young innovator this year went to a startup that combines 2 or 3 FDA approved medications to produce new synergistic treatments for major diseases like cancer, diabetes and arthritis. Sounds simple in principle, but exploring the viability of options that thousands of
combinations throw off is a complex task. But those that can solve the multi-dimensional Rubik's Cube the fastest, will win.
- Learn from other disciplines and industries: Jeff Immelt said the 'day of the one-dimensional manager is over'. We've all heard the multidisciplinary sermon
before, but it continues to ring true. The key though in achieving innovation by gaining insights from other areas, is communication. At HP, Stan Williams leads next generation research and put together an elite & broad team by filling it with deep experts in different fields. But he says, it took a whole year before they developed a language that they could all speak.
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| Category: Conferences | Innovation, General | New Products | Technology
October 6, 2003
Posted by Renee Hopkins Callahan
Renee ... you are amazing! Your Convergence notes are a terrific reminder of all the great stuff that went on there.
A friend sent me the following article which should be interesting to this group. The central role of IT as one of the most powerful gatekeepers of innovation should not be underestimated.
"Innovation Interruptus"
Computerworld (09/29/03) Vol. 31, No. 45, P. 41; Hoffman, Thomas
Industry observers report that IT budget cuts extending over the past few years have dampened innovation, but this has allowed other types of innovation to come to the fore, according to experts such as Computerworld columnist Paul A. Strassmann. Some companies continue to boost their annual IT investments to maintain their competitiveness, though such increases are considerably more frugal than in previous years. Wal-Mart declared several months ago that its 100 leading suppliers have an early 2005 deadline to start tracking their shipping pallets with radio frequency identification tags, while car manufacturer DaimlerChrysler announced in November 2002 that it had begun to invest in Digital Factory, an ambitious project to automate the design of its assembly plants. Meanwhile, UPS has invested approximately $1 billion over the past six years to develop "smart labels" that will help customers more easily locate their packages, and has mapped out a five-year, $127 million investment to distribute the DIAD IV handheld terminal to tens of thousands of drivers. The DIAD IV will save drivers the hassle of manually entering a customer's address and related data and scanning package bar codes in order to get routing instructions. Many companies see the budget crunch as an opportunity to move away from investing in new technologies and concentrate on optimizing existing technologies. RadioShack recently completed the installation of a supply chain management system, while senior VP Mike Kowal says the company has hired a consultant to help shepherd further operational efficiencies through organizational and behavioral changes. Still, 70 percent of 106 IT professionals polled in an August Computerworld survey reported that their IT departments postponed or killed "especially innovative projects" in the past two years, primarily because of budget cuts.
"Unleashing UWB" Electronic Business (09/03) Vol. 29, No. 12, P. 62; Arensman, Russ
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| Category: Conferences | Innovation, General | Technology
October 3, 2003
Posted by Renee Hopkins Callahan
One absolutely fascinating talk was by Phil Fawcett, who’s a Technology Transfer Agent at Microsoft. Phil, a 20-year veteran of Microsoft (one assumes he probably doesn’t have to work anymore!) created this job and has grown it to the point where there’s a small staff of people helping him. His goal: Get research and product people to talk to each other. Right now, half of Microsoft ideas get into release. He’d like to increase that percentage so that the $7 billion Microsoft will invest in R&D in fiscal 2004 will be best used.
Phil says technoloy transfer is a fundamentally social process for managing key technology assets, and it’s a process that requires trust. Trust and risk must be balanced using communication processes. And this is where Phil comes in. Much of his talk was about how he fosters communication among his constituencies (researchers, product groups, senior management) to create a development environment suited to product-ready research.
One point that’s a little beside the point but still interesting: Phil says that for Microsoft researchers, failure isn’t fatal. At Microsoft, the real failure is not to document what you’ve learned from a failure.
Just in case you’re curious, here are some of the Nerd Herder Methods Phil says he uses at Microsoft:
- TechFest – A technology trade show put on by researchers for the rest of Microsoft.
- Blitz – A 2- to 3-hour session, with new researchers or product groups doing demos every 15 minutes.
- Offsite – A 1- to 2-day meeting off-campus for the purpose of exchanging ideas about a topic that may lead to awareness of long-term issues, best used before initial product planning when groups are not talking to each other….need to have key influencers and key combatants there.
- Brainstorm/Collaboration – An exchange of ideas in a 1- to 2-hour meeting session, either to create new solutions or to discuss trade-offs between several alternatives.
- Heartbeat Meeting – Sessions of 3 to 4 “focused” researchers and product group staffers who meet every 1 to 2 weeks to drive action items within their respective divisions and monitor level engagement between the two groups.
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| Category: Collaborative Creativity | Commercialization | Conferences | Corporate Climate | Innovation, General | New Products | Technology
Posted by Renee Hopkins Callahan
Juan Enriquez, director of HBS’ Life Science Project held us riveted to our seats during his morning keynote: As The Future Catches You. With slides of images from Felice Frankel’s Envisioning Science, he talked about what kinds of innovations matter.
Says he: Maps matter. You don’t have to have an accurate map, just a better map than your neighbor’s. And codes matter. Executing the right code matters even more. Literacy in and the ability to map the right code matters a lot. Early maps of the world and the new code of the 26-letter alphabet were once the highest standards of maps and codes. Now the genome map and the DNA code are the ones that matter. Enriquez talked of the "merger between food, drink, biotech and pharma" that will change all of our lives.
It was hard to know whether to be inspired after this or go off in despair because I personally don’t know how to read either the genome map or the DNA code!
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| Category: Conferences | Creativity | Disruptive Innovation | Innovation, General | Technology
September 29, 2003
Posted by Renee Hopkins Callahan
Let’s just get this straight upfront: I am not a real-time conference-blogging demon! For that reason I’m just now getting around to blogging my notes from last week’s Innovation Convergence. But what I lack in speed I hope to make up for in value! I’ve got lots of notes and impressions to share.
First, my overall main impression was that Capital I-Innovation has arrived. Last year’s Convergence had just 70 attendees. This year there were 220, and new conferences on the subject are springing up like mushrooms after a thunderstorm, including this December’s Return on Innovation, at which IdeaFlow contributors Joyce Wycoff and John Wolpert will both be speakers.
Convergence’s very first keynote speaker, Mark Turrell of Imaginatik, referenced a famous (in innovation circles, anyway) Gary Hamel quote that seems to be on its way to becoming reality: “Innovation must become what quality was 20 years ago.”
Turrell sounded another common theme in his keynote, “Measuring the Financial Impact of Innovation: Calculating Your Innovation Gap.” That common theme was to make a differentiation between innovation and creativity, and pretty much every speaker I heard did this. Boiled down to the basics, the difference seemed to be that innovation is a process and creativity is not. Devotees of a process approach to creativity might beg to differ, but for the purposes of this conference, the distinction allowed most speakers a productive platform from which to dive into their take on the innovation process.
My notes on Turrell’s innovation/creativity definitions: Innovation’s a much more corporate thing than creativity, much more of a process. People who don’t get creativity are the ones who control the budgets, the ones you must convince to fund innovation.
Innovation is the process of handling new things; creativity is a one-off, invention is a one-off. Invention and creativity are part of the innovation process.
The main point of his talk was to expound on IOI, or the financial Impact of Innovation. He defined this as the proportion of current and future revenue and profit that is dependent on the company’s ability to innovate, and defined IOI components as revenue growth, revenue protection, productivity, and disruptive change (unplanned activities, or risk).
He then said the innovation gap is the difference between the target level of innovation (IOI) and the current innovation capacity, which is based on the ability of a firm to handle new things.
Idea management is important, because too many new ideas block the pipeline. You could expect him to say that, since Imaginatik is in the idea-management business, but this was another theme that was sounded by many speakers, including the other opening-day keynote, Dr. George Land of the Farsight Group.
First, Land's innovation/creativity definitions: At the beginning of his talk, “A Systems Process for Innovation,” he defined innovation as “organized creativity.”
Land’s Advanced Innovation Method is a process for bringing innovation to a corporation. Most important is the first part, determining what strategic innovation would be for the company. Seventy percent of time and budget should go to the first three steps, he says, which doesn’t even get you to the generating concepts stage. The important first three steps encompass alignment, an innovation audit, and a determination of an innovation strategy. A big part of this is determining internal and external customers’ “deep needs” – what does the customer really want or need in the future? Land says his company actually puts a large number of resources into training a client company’s customers in creativity to get them to articulate their needs. I of course found this fascinating in light of our own consumer-based approach, which has been discussed here recently.
And, connecting to another discussion we’ve been having here lately, this time on the Copyright Wars, Land dropped something of a bombshell early on in his speech by declaring that “product innovations are very easy to copy, and patents are an invitation to a lawsuit.” Sure enough, the first question in the following Q&A was about this assertion. Land explained further: Patents are very easy to go around. The issue is a flow of innovation, and what’s in the pipeline to develop after what you’ve got now has been copied. Always assume you’re going to get copied, and try to discover where you can innovate that it will be invisible. Developing intellectual assets – documented current and past knowledge that can lead to the creation of new knowledge through systematic innovation -- is better than developing IP, which he defined as “knowledge with legal ownership.”
According to Land, only 15% of corporate innovation comes from R&D departments, so that’s not the most important place to be innovative in a corporation. The companies most successful at innovation are stealthily innovating their process, distribution, or some other aspect that’s hard for competitors to grasp and copy.
But in any case, he echoed Turrell by saying, “don’t bust the dam of ideas until you’ve got somewhere for the water to go. Innovation efforts must be targeted or they create chaos. It’s a duty and an obligation NOT to collect too many ideas, to be ruthless with idea management.”
Finally, and this is another theme that was echoed over and over again: The CEO must drive innovation, and financial gap analysis is essential on the front end. You must arm yourself with the facts. Land also felt that a company should have an EVP or C-level innovation executive heading an innovation department that would integrate all functions – marketing, technology, business development, etc. And a company’s biggest barriers to innovation, in his view, are lack of leadership to drive innovation, and lack of strategic alignment regarding innovation.
And this was just the first part of the first day!!! More to come.
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| Category: Collaborative Creativity | Commercialization | Conferences | Corporate Climate | Creativity | Disruptive Innovation | Innovation, General | Law & Policy | Marketing | Marketing Research | New Products | Open Innovation | Patents | ROI (Return on Innovation) | Technology
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