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Issue 22 – March 1, 2013
1. 2. 3. 4. 5. 6. 7. 8. 9. 10.
Making Time for Innovation..................................................................... Kevin McFarthing Why the Front End of Innovation is Different ……..……………...……...…. Jeffrey Phillips Innovation Eats Itself ………………………………………………..…...……… Mike Shipulski Three Obstacles to Innovation Diffusion ....................................................... Tim Kastelle Leadership, Timing and Opportunity .……………………………….………….… Mike Myatt How Small Innovation Teams Hit the Nail …………………...…………………. Nicolas Bry Birth of a New Job Type! Arise co-creation manager ………..…………….... Yannig Roth Why Design Thinking Will Fail …………………………………………….….. Jeffrey Tjendra Innovation REALLY Matters – Lessons Learned from Detroit ………....... Adam Hartung Design & Innovation with Robert Fabricant, frog design ….………...…...… Lou Killeffer
Your hosts, Braden Kelley, Julie Anixter and Rowan Gibson, are innovation writers, speakers and strategic advisors to many of the world’s leading companies.
“Our mission is to help you achieve innovation excellence inside your own organization by making innovation resources, answers, and best practices accessible for the greater good.”
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Making Time for Innovation
Posted on February 23, 2013 by Kevin McFarthing
A very good friend of mine works for a large, global company with multiple locations around the world, many of which are run as “hot desks”. He is in a position of responsibility, and often finds himself travelling to a different destination on the other side of the world at short notice. It’s the kind of business where looking for ways to innovate is very important, as is time management.
Just to clarify, innovation in the core product is a long-term game for reasons of investment and regulation, so the focus is on an innovative approach to how things are done.
I can therefore understand his deep frustration when he describes the weekly telecon. A large number of people assemble at the same time every week around their conference phones. The time is chosen to accommodate as many of the global team and their direct reports as possible, but inevitably some people are up really early and some really late. There is an understandable impact on operational effectiveness and family life.
The first item on the agenda is to understand who is on the line. Given that there are over fifty people on the call – yes, you did read that correctly – this takes some time. The boss then launches into a list of the other items she wants to cover, then starts the meeting. I use the word “meeting” advisedly here. As I’m sure you’ll have worked out already, this format is not the most efficient or appropriate for an exchange of views, so it simply degenerates into a monologue interspersed with questions directed at the “usual suspects” on the call. “Jim, what do you think?” wakes Jim up with a start to realize his mind had drifted somewhere else….. And before you know it the hour is up and everybody is signing off.
An agenda is produced in advance, with different people chosen at random to speak on ideas for initiatives to improve the effectiveness of the business. These often don’t relate to previous initiatives that are just left to roll on, leading to a large number of projects and a small number of completions. Over time the operating managers have realized the situation, so are sapped of the energy and will to persevere. This is even before the regulatory implications of any change can be evaluated.
All that is achieved is the opportunity for the boss to verbally issue instructions that could have been done by email. There is no time to seriously discuss how the business can do things better, no coordinated project structure and no project management. And yet, innovation is expected. The senior operating managers are expected to improve the way they run their businesses, which of course is the right thing to do. However in the absence of a common approach, managers just do what they think is right for their office. This produces some nice short-term gains but an inevitable fragmentation of practice.
This situation may be somewhat extreme, and be as much about the efficient use of time and clear communication as it is about innovation. Nevertheless I think there are some points to make. First, if you are serious about innovation, time must be found to do it properly, with a clear link to strategy, a strong understanding of priority areas to attack, a process that’s well understood and targets to reach. There is no point allocating an hour in the management meeting agenda and saying, “right, it’s innovation time, let’s have some ideas.” And please, don’t start an innovation initiative with a suggestion scheme.
Second, as much commonality of approach as possible should be sought to avoid wide deviation in practice. On this point, I appreciate the attraction of individual initiative and there is no desire to quash it, on the contrary. While the really important areas should have the best available way for common implementation, the best source of this is often an entrepreneurial group of people who have piloted the new method and shown it to work.
Finally, your people are all really busy; don’t waste their time on pointless meetings just to show them who is boss.
image credit: businessman standing image from bigstock
Kevin McFarthing runs the Innovation Fixer consultancy, helping companies to improve the output and efficiency of their innovation, and to implement Open Innovation. He spent 17 years with Reckitt Benckiser in innovation leadership positions, and also has experience in life sciences.
Why the Front End of Innovation is Different
Posted on February 27, 2013 by Jeffrey Phillips
Let’s assert that you’ve become very good at your job. Whether you are in finance, marketing or operations, your proficiency is based on your education and your work history. You know how to anticipate financial needs, or how to manufacture products more efficiently because you love what you do, you do it often and you are rewarded to do it well. You have deep knowledge about your chosen area of specialty and you can demonstrate expertise. Then along comes an innovation need.
If the innovation need is really just continuous improvement or slight improvements to existing products, you are in luck, because that work simply requires that you extend your existing deep body of knowledge. If, on the other hand, you need radical or disruptive innovation, your existing body of knowledge, your scope and frameworks, even your tools and insights may become barriers to innovation rather than accelerators. That’s because true innovation is about discovery, learning and analysis rather than building on past knowledge and success. True innovation is unusual, and requires a different approach. Innovation is the only activity in a business where the people involved are amateurs, because we spend so little time in most businesses working on discovering new needs, learning about customers and markets, and thinking deeply about the implications from discovery and learning.
Let’s consider three factors that make the “Front End” of innovation so different from the rest.
Most of us in businesses spend our days perfecting what we already know. The processes that drive a business are evident and wellunderstood, and may need a few tweaks to perfect them. There’s little to discover about the day to day operations, as most of it has been understood and perfected for years. Deep expertise and constant repetition mean that discovery is rarely needed. Tools and capabilities that aren’t exercised become moribund and stale. We lose a sense of discovery when that sense isn’t effectively or even periodically applied.
When innovators talk about the method of innovation, they usually describe it as a “divergent – convergent” process. This means that the first activity is about “diverging” – enlarging the scope, enlarging the number of possible outcomes, discovering new possibilities. Most of us are very good at converging – eliminating even the reasonable alternatives to quickly arrive at one specific solution. Divergence is often one of the most difficult aspects of innovation for many corporate executives to grasp, because it feels like unnecessary effort. Further, divergence is uncomfortable because it requires discovery and exploring areas where the level of expertise is much lower, or non-existent.
Discovery requires people who are comfortable going beyond what they know, who are interesting in discovering something new which has relevance to their organization. It requires those people to look in unexpected places for new and unanticipated things. In other words, a surprise. And you know how managers and executives love surprises.
If innovation creates something new to your market, or new to the world, then by definition someone has to partake in a learning exercise. We may have to learn about needs, or new capabilities, or new channels, or new customer segments, but there is little innovation that isn’t preceded by learning. Yet learning, especially learning beyond the tools and activities that enable existing products and services is almost unheard of in modern corporations. We spend countless thousands of hours learning about personality differences, tolerance, communication, and other workplace factors that reinforce the existing frameworks, and spend virtually no time learning about emerging needs, emerging technologies and adjacent markets. For most organizations, learning stops at the edge of the corporation or at best the industry, and looks no further than 12 months in advance. External issues and needs are scarcely considered, and adjacent markets, nimble new entrants and emerging customer needs are ignored. Many product managers have never met a customer who actually uses their product, and never meet prospects or segments that actively refuse to use the product.
As noted previously, discovery is given short shrift. If there is no discovery, there’s little need for learning about the wants and needs of the discovered market, segment or opportunity. Even when discovery is possible, little time is left for learning. It is expected that we have all the education and learning we need to make important decisions about markets, needs and trends that we know almost nothing about. It begs to be said again: there’s no innovation without learning.
You may have heard that experts are often the biggest barriers to innovation. That’s often because they don’t believe that any further discovery is possible, and that they know or have learned all that is important to know or learn in a field. It’s hard enough to spend time learning in your chosen field. Trying to obtain the time and resources to learn in a new area, new market or about a new opportunity is difficult if not impossible. But without learning, you cannot create interesting innovations.
Analysis and Synthesis
If you are lucky enough to have the time to discover and learn, the final activity is perhaps the most important and the most difficult to justify. Because discovery and learning are active tasks, in which you can be seen to be doing something. But the most important task – analysis and synthesis – looks a lot like contemplation and, worse, thinking. And often we don’t value these activities because they aren’t quantifiable and don’t appear to contribute to the bottom line. In a knowledge based economy, we’ve placed a maximum amount of emphasis on activity and a minimal amount of emphasis on what creates knowledge – thinking!
Analysis and synthesis is the capstone to discovery and learning. If you can take what you discovered, add to it what you learned, and then think deeply about what it means and the implications to your market, industry, customers and business, then you are innovating. Understanding a need or opportunity, learning more about its importance and relevance, and deciding how to respond is a virtuous circle of activity for innovation, but one that happens far too infrequently.
Analysis and synthesis are suspect because they require careful consideration by people who were immersed in the discovery and the learning. These activities seem somewhat passive from an outside observer’s perspective and are subject to ridicule because the solutions are not quantifiable. In this activity we are drawing insights and conclusions, interpreting the discovery and what we learned, and using our instincts and insights to define new products, services and solutions. Far too often the scope is defined in advance, and may powerful new insights and opportunities are ignored or shut out of scope before the discovery and learning could take place.
Putting it all into context
If you want to innovate, to create truly new ideas, you need to be willing to discover new needs, new markets or new opportunities. Once you have discovered those opportunities, you need to learn more about the emerging market or need. Why does it exist? Why is it unsatisfied with existing solutions? Once your discovery and learning are complete, you can then begin to interpret, analyze and understand what the true needs and wants are. Only then are you ready to generate ideas, which will really be solutions.
Most organizations don’t appreciate the amount of discovery, learning and thinking that are necessary for true innovation. They don’t allocate the time, don’t assign the right people for these tasks and don’t establish the corporate expectations and culture to define a framework in which people can succeed. Since discovery, learning and thinking aren’t active and don’t seem to produce a quantifiable product, they are discounted and often skipped in the innovation process. This is another reason why so many firms do incremental innovation and continuous improvement so well, and have such a difficult time creating truly new ideas. They don’t take the time to discover new opportunities or needs, they fail to engage in any learning, and resist deep thinking and interpretation if they managed to do any discovery or learning along the way.
What’s interesting is to see “innovation” initiatives that have completely skipped the discovery, learning and thinking activities. They move directly to idea generation. When you hear people say “brainstorming” doesn’t work, they are correct if and when businesses skip the preceding steps. How can you generate interesting ideas or solutions when you haven’t discovered new opportunities or needs, and learned more about their causes and relevance?
Not unknowable just different
The Front End of innovation is not unknowable or undefinable, it is simply different from much of what your organization does regularly, and must be understood in that context. If you’ll place more emphasis on discovery and what it takes to discover new needs and opportunities, learning and the commitments of time and resources to truly understand what you’ve discovered, and analysis to place into context the discovery and the learning, you’ll have a much more capable Front End.
image credit: the line image from bigstock
Jeffrey Phillips is a senior leader at OVO Innovation. OVO works with large distributed organizations to build innovation teams, processes and capabilities. Jeffrey is the author of Relentless Innovation and the blog Innovate on Purpose.
Innovation Eats Itself
Posted on February 25, 2013 by Mike Shipulski
We all want more innovation, though sometimes we’re not sure why. Turns out, the why is important.
We want to be more innovative. That’s a good vision statement, but it’s not actionable. There are lots of ways to be innovative, and it’s vitally important to figure out the best flavor. Why do you want to be more innovative?
We want to be more innovative to grow sales. Okay, that’s a step closer, but not actionable. There are many ways to grow sales. For example, the best and fastest way to sell more units is to reduce the price by half. Is that what you want? Why do you want to grow sales?
We want to be more innovative to grow sales so we can grow profits. Closer than ever, but we’ve got to dig in and create a plan.
First, let’s begin with the end in mind. We’ve got to decide how we’ll judge success. How much do we want to grow profits? Double, you say? Good – that’s clear and measurable. I like it. When will we double profits? In four years, you say? Another good answer – clear and measureable. How much money can we spend to hit the goal? $5 million over four years. And does that incremental spending count against the profit target? Yes, year five must double this year’s profits plus $5 million.
Now that we know the what, let’s put together the how. Let’s start with geography. Will we focus on increasing profits in our existing first world markets? Will we build out our fledgling developing markets? Will we create new third world markets? Each market has different tastes, cultures, languages, infrastructure requirements, and ability to pay. And because of this, each requires markedly different innovations, skill sets, and working relationships. This decision must be made now if we’re to put together the right innovation team and organizational structure.
Now that we’ve decided on geography, will we do product innovation or business model innovation? If we do product innovation, do we want to extend existing product lines, supplement them with new product lines, or replace them altogether with new ones? Based on our geography decision, do we want to improve existing functionality, create new functionality, or reduce cost by 80% of while retaining 80% of existing functionality?
If we want to do business model innovation, that’s big medicine. It will require we throw away some of the stuff that has made us successful. And it will touch almost everyone. If we’re going to take that on, the CEO must take a heavy hand.
For simplicity, I described a straightforward, linear process where the whys are clearly defined and measurable and there’s sequential flow into a step-wise process to define the how. But it practice, there’s nothing simple or linear about the process. At best there’s overwhelming
ambiguity around why, what, and when, and at worst, there’s visceral disagreement. And worse, with 0% clarity and an absent definition of success, there are several passionate factions with fully built-out plans that they know will work.
In truth, figuring out what innovation means and making it happen is a clustered-jumbled path where whats inform whys, whys transfigure hows, which, in turn, boomerang back to morph the whats. It’s circular, recursive, and difficult.
Innovation creates things that are novel, useful, and successful. Novel means different, different means change, and change is scary. Useful is contextual – useful to whom and how will they use it? – and requires judgment. (Innovations don’t yet exist, so innovation efforts must move forward on predicted usefulness.) And successful is toughest of all because on top of predicted usefulness sit many other facets of newness that must come together in a predicted way, all of which can be verified only after the fact.
Innovation is a different animal altogether, almost like it eats itself. Just think – the most successful innovations come at the expense of what’s been successful.
Mike Shipulski brings together people, culture, and tools to change engineering behavior. He writes daily on Twitter as @MikeShipulski and weekly on his blog Shipulski On Design.
Three Obstacles to Innovation Diffusion
Posted on February 25, 2013 by Tim Kastelle
Obstacle 1: Competition
Probably the most common question I get about this blog is “how do you find time to write it?”
It’s the same question that I used to get about reading – where do I find time to read books?
The answer to both is the same – I make time. One of the ways that I make time is that I don’t watch much television anymore.
You wouldn’t think that writing a blog has competition, but it does. In order to write a post, I have to not be doing other things with my time. So as I’m writing this, I’m not watching The Wire, even though nearly every single person I know has told me that I must. And I’m not reading either.
If something as simple as writing a blog post has competition, then clearly your competition is never “no one.”
So that’s one big obstacle to getting your great new ideas to spread – even if there is no obvious competition, you’re competing for time, or attention, or money, or…
Jason Fried makes a similar point in his post asking “what is someone going to stop doing when they start using your product?”
“So, when you’re thinking about your product, think about what it replaces, not just what it offers. What are you asking people to leave behind when they move forward with you? How hard will that be for them? How can you help them overcome everything that’s tugging them in the opposite direction?”
Obstacle 2: People that are hurt by your idea
No matter how great our idea is, or how beneficial, some people will be made worse off when it’s executed. This is summed up nicely in yesterday’s cartoon from the brilliant xkcd:
We like to think that our new ideas are benign, or only beneficial. But as the comic shows, even the most harmless looking change will inevitably make someone worse off.
There are always innovation winners and losers. Just as it’s important to think broadly about competition, it also pays to think broadly about who might lose when your innovative idea is executed.
Obstacle 3: Time
The first two obstacles both contribute to the third one: new ideas always spread more slowly than we expect. New ideas always spread though an S-Curve:
The time it takes to work through the period marked X takes time – and that often takes people by surprise. It is a slow process because it takes time for people to hear about new ideas, it takes time to evaluate them, and it takes time to decide to adopt them. Once all that happens, it often appears as though successful ideas are overnight successes, but that’s only because they’ve finally hit a tipping point.
How to work through these obstacles
The first issue is that you need to be aware of them. The idea diffusion s-surve is a research finding that has been consistently supported for 60 years now – it’s is one of the most robust ideas in management research. Yet it is still often misunderstood – just ask Kodak.
Here are four ideas for addressing this issue:
1. Think about timing. You have to think about the timing of your idea. If you are still at an early stage in the diffusion process, all of your attention must go to getting your idea to spread. The right idea at the wrong time is still wrong. This means that you need to think about things like your network of supporters, and how to best take advantage of them to spread your idea.
2. Early ideas need little bets, not big ones. When we face an uncertain future, as we do at the start of the innovation diffusion curve, then we need to try to influence the future through experimenting. The problem with big bets at this point in time is that they assume that we know how everything needs to work. When we’re in time X, we don’t know this – we have to discover it.
3. Think about competition. And think about it broadly. Competition for time, attention and money will all slow the spread of a new idea. If people aren’t using your product or idea, what are they using instead?
4. Think about who loses. This is another source of resistance. The competitors that we just considered are one source. But also, whose routine does the new idea disrupt? People trying to maintain their current routines are a powerful force preventing the diffusion of new ideas. You need to overcome this as well.
People often think that having a great idea is the hard part of innovating. Most of the time, this isn’t the problem. Getting the new idea to spread is.
If you’re serious about innovating, you have to be serious about idea diffusion too.
image credit: tickledlife
Tim Kastelle is a Lecturer in Innovation Management in the University of Queensland Business School. He blogs about innovation at the Innovation Leadership Network.
Leadership, Timing and Opportunity
Posted on February 23, 2013 by Mike Myatt
What better time to discuss opportunity than the start of a new year? The message I want to deliver is this; opportunity and timing are inexorably linked. So much so, that if you don’t think timing is everything - think again. Even a cursory review of current events shows it doesn’t really matter whether you’re a politician, investment banker, CEO, or just an average citizen – when it comes to making a simple decision, managing a crisis, or attempting to exploit an opportunity, timing is everything. In today’s post I’ll take a look at opportunity as key success metric…
I’ve often heard people quip they would rather be lucky than smart. While intelligence and good fortune are certainly both valuable traits to possess, neither of these traits holds a candle to having a great sense of timing. Luck is a hit or miss proposition, and we’ve all known many a brilliant underachiever. However it has been my observation you’ll rarely come across someone who possesses a great sense of timing who is anything other than successful.
As the verse from the old Kenny Rogers song goes “you have to know when to hold em and know when to fold em.” There are a few times in the life of every professional where staggering opportunities will present themselves. The question is not whether these opportunities exist, but rather what will you do with them when they cross your path. I believe one of the key differences between excellence and mediocrity is the ability to not only recognize opportunities, but to also possess an understanding and willingness to exploit said opportunities. Exploiting opportunities requires you not only possess vision, but also a corresponding bias to action (and a bit of courage as well).
Rarely will you come across a static opportunity in the sense that it will stand idle and wait for you to act. Significant opportunities are not only scarce, but they typically operate on the principal of diminishing returns. Put simply, opportunities are time sensitive. The longer you wait to seize the opportunity the smaller the return typically is. In fact, the more likely case is the opportunity will completely evaporate if you wait too long to seize it. Keep this thought in mind; when opportunity knocks – answer the door.
I can’t even begin to count the number of times I watched people miss great opportunities due to a poor sense of timing. Not too surprisingly, people who possess a poor sense of timing usually don’t even understand timing is an issue. How many times have you witnessed someone holding-out for better talent, a higher valuation, evolving markets, technology advances, or any number of other circumstances that either never transpire, or by the time they do, the opportunistic advantage had disappeared? I’ve observed the risk adverse take due diligence one step too far, the greedy negotiate too long, the impulsive jump the gun, and the plodders move to slow. As the saying goes “timing is everything.” The following list contains 5 suggestions for how to spot and evaluate opportunity:
1. Alignment: The opportunity should be in alignment with the overall vision and mission of the enterprise. Any new opportunity being evaluated should preferably add value to the core, but if not, it should show a significant enough return on investment to justify the dilutive effect of not keeping the main thing the main thing. The core should be used to align, but not necessarily to exclude.
2. Advantage: No advantage equals no opportunity. If the opportunity doesn’t provide a unique competitive advantage it should at least fill a void bringing you closer to an even playing field. Be careful however not to fall into the trap of “me too” innovation – copying isn’t innovating. Instead of leveling the field, think about tilting the field to your advantage, and where possible, the creation of a new field altogether.
3. Assessment: Is the opportunity affordable, feasible, adoptable, and most importantly, is it actionable? An opportunity which cannot be implemented isn’t really an opportunity – it will likely be just another very costly distraction. Conduct your diligence before you pull the trigger, not afterwards. A ready – fire – aim approach to opportunity management usually fails to hit the target.
4. Accountability: Keep in mind great ideas are not always the same thing as great opportunities. Ideas don’t always have a corresponding vision, nor do they always contain a framework of accountability which helps to ensure a certainty of execution. For opportunities to become reality they must be viewed through the lenses of organizational awareness and personal responsibility. Any new opportunity being considered should contain accountability provisions. Every task should be assigned and managed according to a plan and in the light of day. Any opportunity being adopted must be measurable. Deliverables, benchmarks, deadlines, and success metrics must be incorporated into the plan. The opportunity must be detailed and deliverable on a schedule – it needs to have a beginning, middle and end. Any opportunity not subjected to sound principles of leadership will likely fail.
5. Achievement: Opportunities are great, but achievements are better. If any of the four items above are missing the outcome will be unrealized opportunity, or opportunity squandered and lost. The smart game is not played for what could have been, or should have been, but for what was achieved.
The proverbial window closes on every opportunity at some point in time. As you approach each day I would challenge you to consistently evaluate the landscape and seize the opportunities that come your way. Better to be the one who catches the fish than the one who tells the story of the big one who got away…
Mike Myatt, is a Top CEO Coach, author of “Leadership Matters…The CEO Survival Manual“, and Managing Director of N2Growth.
How Small Innovation Teams Hit the Nail
Posted on February 25, 2013 by Nicolas Bry
‘Small Is Beautiful‘ comes from a collection of essays by British economist E. F. Schumacher, first published in 1973. Championing small organizations, believed to empower people, asserting that ‘people can be themselves only in small comprehensible groups’, it strongly contrasts with “bigger is better”.
Does this concept apply to innovation? Whether you look at start-ups fortunes and ‘lean start-up’ approach, spot the ’2 Pizza team’ practiced by Amazon, or read the analysis by @scottdanthony about the ‘New Corporate Garage’ (‘catalysts using big company resources to develop solutions at global scale), status is clear: small teams are better to achieve breakthrough innovation.
Can we feature an optimum number for team size? Evan Wittenberg, former Head of Global Leadership Development at Google, states; “It does tend to fall into the 5 to 12 range, and the number 6 has come up a few times.”
Nevertheless smallness is not enough to succeed. How we can enhance the actions of small innovation teams, and support them in their progression is what we are tackling here.
Making innovation team perform better
Rapid Innovation model provides a few hints about boosting innovation teams. Seeking to accelerate innovation pace, it crafts an organizational model based on:
Setting-up an agile and autonomous innovation entity; Guiding team through a framework called “creative tension”, a mix of stimulating goals and proven ‘theory and practice’ skills;
Aligning ideas and probes with innovation group strategy, across a shared portfolio and permanent cooperation;
Shaping deliverables in modular design mold, to unleash collaboration.
Autonomy, guidance, cooperation, modularity are strong tips to help innovation team perform better:
Autonomy unlocks motivation: autonomy encloses multifunctional project team concentrating all necessary skills to achieve a functional module (‘feature team’); it’s as well an organizational culture “where people serve their goal” as Gary Hamel expresses it. “To motivate people, providing autonomy does a better job than carrots” adds @danielpink, and @nilofer notes from her experience: “Putting all ideas on the table, and allowing people to have ownership, changes everything”. Agile structure is also more responsive to the unexpected: freed from orthodoxy chain, it starts from actual situation potentialities, leveraging the drivers that show up;
Guidance builds confidence: if the mantra ‘Let the team lead the team’ is essential for the team daily life, innovation team shall not be left alone, lost in the desert; ‘Creative tension’ aims at setting-up a positive tension for creativity: challenging goals (specific time frame, leapfrogging performance, new market targets) and in parallel, innovation tools practice (design-thinking, user-lead approach, fast iterative prototyping, ‘rugby line’ progression for knowledge circulation, open innovation, hack day or 20% free time granted at Google and 3M) support the team endeavor. It means ‘Structured Serendipity’, and echoes William Duggan ‘Strategic Intuition’. Innovation is a discipline which you need to teach, practice and share: when composing your team, remember it’s a job for professionals;
Cooperation culture strengthens legitimacy: innovation is not only a question of conviction: it’s a dialogue, which requires listening before pushing your creative views to the conversation. Capturing the moment where change is needed is delicate: understanding when your company is open to innovation, ‘willing to renew its identity while remaining itself’, will fetch you acknowledgement;
Modularity establishes your innovation capital: modular deliverables facilitate acceptance, letting others build value on top of your platform; modularity is a toolbox for design. Actually, even if your innovation fails, modules that you have designed will be reused by other innovation teams, linking innovation teams to one another, activating the intelligence of the many through a living capital.
Assuming our innovation team performs, we might want to scale, pursuing multiple innovation tracks concurrently. How do we achieve consistency, cross fertilization, and overall efficiency in the organization? Innovation portfolio and cooperative governance can help.
‘Balanced, inspired, staffed, dynamic, transparent, scalable’: that’s what your innovation portfolio should look like, as ‘a jewelry case to your innovation project’.
If innovation teams are well set, ‘they won’t feel like employees working for someone else, they will feel much more like belongers as Richard Branson descrives. A savy innovation portfolio is here to infuse a sentiment of ‘belonging’.
Not limited to reflecting a strategic point of view, portfolio is a leadership tool, a clear picture of your intent you can share and build with your teams. It can help each team see where they fit, for example using a simple classification in three kind of initiatives:
Disruptive and radical projects are drawing on a “silver bullet” bet, with high reward and risk, significant time and engagement; Quick wins projects, at the opposite, are addressing some concerns of the core company, and demonstrating your capabilities to deliver; they can be limited to functional modules;
Probes are illustrating future trends, materialize ideas through demonstrators, support the conversation about new concepts, and will eventually feed the projects pipe.
Once every team finds out its position, how to link teams to one another, and activate the flow of natural communication?
Spotify illustrates a peculiar governance put in place to scale their Agile methodology used for product development. Henrik Kniberg and Anders Ivarsson, Spotify employees, explain how it works. Business is divided into small unit called squad, feeling like a mini-startup: “there are 30 squads, covering 250 people in all in three countries. A squad has a product owner, responsible for prioritizing the work, and collaborating with other product owners to maintain a high level road map document.”
“Related squads are grouped into tribes, behaving as “incubators”. Tribes hold informal gatherings on a regular basis, showing what they are working on, what they have delivered and what others can learn from what they are currently doing. “Tribes interact rarely; for specific projects, synchronization meeting called “scrum of scrums” is set-up on demand.
“For sharing knowledge and creating tools for the benefit of all squads, there are chapters (similar skills within a tribe) and guilds (community of interest across tribes), the glue that keeps the company together, and raises economies of scale.”
Besides its ingenuity, what I hold from Spotify organization is:
Size threshold: governance structures correspond to limited sizes, approx 8 people per squad, less than 100 people in a tribe, to keep them small and agile;
Relevance: Spotify doesn’t set structure ‘per se’, it involves meaning for every entity. To be legitimate, governance should flow naturally, and be oriented to support knowledge circulation;
Reverse-matrix: compared to traditional matrix where people are “pooled” together into functional departments, and “assigned” to projects, at Spotify project dimension comes firsts, and is the basis to build stable co-located squads;
Healthy tension: “while Product Owner acting as an entrepreneur tends to want to speed up and cut corners, chapter lead or professor tends to want to slow down and build things properly. Both aspects are needed, that’s why it is a “healthy” tension.”
The API metaphor
Heading small innovation teams is somewhat familiar with API design-thinking: it involves meaning, target, expandability, scalability, and innovation ecosystem.
One could think of managing small independent innovation units like processing API: harnessing collaborative innovation, streamlining seamlessly community energies, building a whole connecting functional legos, and initiating new service streams almost instantly by linking.
Credits: hannah-broadway-pictures.blogspot, bansemer.com, corbis, fruitimage.com, spotify
Nicolas is a senior VP at Orange Innovation Group. Serial innovator, he set-up creative BU with an international challenge, and a focus on new TV experiences. Forward thinker, he completed a thesis on “Rapid Innovation”, implemented successfully at Orange, and further developed at nbry.wordpress.com. He tweets @nicobry
Birth of a New Job Type! Arise co-creation manager
Posted on February 24, 2013 by Yannig Roth
Innovation has become the name of the game for businesses to compete effectively in an increasingly kinetic, globalized and technologydriven marketplace. To ensure a constant supply of new ideas, today’s corporations know that they cannot rely solely on internal resources or a small circle of consultants anymore. It is now widely recognized that the ability to innovate also comes from the ability to leverage external resources to co-create value.
The pioneering example of Connect+Develop, a network of partners with whom P&G works to co-develop new products, has now become mainstream: General Mills has a program called G-Win, Kraft has its Innovation Kitchen, Nokia has launched its Ideas Project to crowdsource ideas…
With this fundamental shift towards an “open model” of innovation comes the need for skilled employees who are able to manage this strategic openness for companies. This begets a series of fundamental questions: Who should manage co-creative efforts within firms? What should be their background? Who should they report to? What resources and authority should we bestow upon them? From “Director of Global Open Innovation” to “Head of Crowdsourcing” we have looked at a handful of newly appointed co-creation managers to gather some interesting insights into this new breed of managers (sources for this article are listed at the end).
Companies are looking for specialists that can leverage the wealth of external networks to access fresh ideas. Who are these specialists?
Co-creation managers have a solid academic background and plenty of company experience to foster collaboration within their organization
The Fast-Moving Consumer Goods (FMCG) industry has pioneered the model of open innovation. It is therefore not surprising that all FMCG giants have people dedicated to implement value co-creation across their organizations. Most of them have a similar background: a Ph.D. in a scientific discipline and a solid experience as R&D managers within their respective organizations.
Chris Thoen, who managed Procter & Gamble’s Global Open Innovation Office, holds a PhD in Biochemistry and has worked for
Procter & Gamble’s R&D departments since his early career. His experience at P&G brought him extensive technical and program leadership experience in consumer and commercial branded products, which he leveraged to build Connect+Develop.
At General Mills, Jeff Belairs, Senior Director of Connected Innovation and manager of General Mills’ Worldwide Innovation Network (G-WIN), enjoys extensive experience in the food industry. “I knew how R&D was done — it was done with the best employees you could hire,” he said about his experience.
At Mondelez, open innovation is managed by Miles Eddowes, an Oxford engineering graduate with a master’s degree in scientific instrumentation. “I started to get a real kick from working across the boundaries of different scientific disciplines whilst working for my PhD at the National Medical Laser Centre at University College London Hospital,” he said to the Irish Times. He subsequently joined Unipath, a high-tech spinout from Unilever, and was part of the team that developed the digital home-pregnancy test. “It was there that I learnt the art of open innovation – stretching the ambition of the parent company by building strategic partnerships to do what neither company could do by themselves,” he explained.
Open innovation is growing out of the FMCG-sector and this is where we find more diverse co-creation managers’ profiles. At Nokia, the former Head of Crowdsourcing, Pia Erkinheimo, had a background in human resources and strategy, inside and outside of Nokia.
At Lego, the Senior Manager who manages Open Innovation, Stiven Kerestegian, has a design background, with 15 years of design experience working with international corporations, consulting agencies and start-ups.
Whatever the background and the experience, the daily job of co-creation managers is very similar from one company to another. The job of Unilever’s Director of Innovation Acceleration and Commercial Alliances Graham Cross, for example, is not solely focused on R&D but on “getting the maximal benefits of having Unilever collaborate with providers of any kind […] such as
other companies and academic institutes”. To achieve this, co-creation managers have to engage in a variety of activities, from internal communication to networking with external partners.
A rich blend of internal and external project management, strategic vision and tactful implementation
Co-creation managers, crowdsourcing managers, open innovation managers… All these job titles have basically the same function: finding a way to align internal and external interests in order to co-create value together. “It’s about finding smart people inside and outside the company who can positively impact your business,” explained Jeff Belairs on General Mills’ open innovation blog. “It’s tremendously exciting as you discover new technologies and partners that can drive your business forward. And it’s equally challenging as you push against a culture that was built doing things internally.”
We found that co-creation managers’ role is often articulated around four key activities: setting-up a strategic roadmap for co-creation, fight against internal resistance to change the culture, explain the concept of co-creation, and establishing a solid partner ecosystem.
1) Setting up the strategic roadmap to implement co-creation
In its job offer to find a Senior Manager for Open Innovation, the Lego Group stated that the applicant’s mission would be “to support Lego’s growth ambition by establishing a systematic and disciplined approach to open innovation.” Every ship’s captain needs a second-in-command. While the CEO might impose open innovation as a strategic priority, there is still a need to implement it in practice. “There’s a need for a facilitator or roadmap for the entire open innovation process; something that would let our scientists be scientists, while the process could be the general management solution to guide them,” said Jeff Belairs from General Mills.
This implies setting up processes, managing people, and monitoring daily activities. Besides setting up processes and/or frameworks, cocreation managers also coordinate a team to implement their strategic roadmap. Belairs describes that General Mills has “almost 30 people dedicated full-time to the General Mills Worldwide Innovation Network, which is helping the company advance its innovation strategy.” He doesn’t directly work with all of them: “I manage a central team of seven that is in charge of tools, culture, process, and programs.”
2) Turning the “not-invented-here” into “proudly found elsewhere”
One of the biggest challenges for co-creation is to change company culture to accept the new open paradigm. “One of the problems in organizations can be resistance from those caught up in the ‘not invented here’ syndrome,” said Miles Eddowes, Director of Open Innovation at Kraft Foods.
Perfecto Perales, Senior Director of Packaging Research, similarly said that “it’s tough to change the culture and people’s behavior, and it seems to be happening.” He said that “it’s like a muscle that you’ve got to continuously exercise it to make it stronger. Kraft is continuing to build its innovation muscle and leverage it as a strength for our company.” The people who are in charge of organizing strategic openness have to fight company culture first. The best way to implement change is to show how co-creation is a win-win situation, thus to communicate it internally.
Steven Goers, previously VP Open Innovation & Investment Strategy at Kraft Foods and now at Consulting Partner at YourEncore, described in an interview: “One of the things that surprised me was the length of time and the amount of communication needed in order to gain clarity and alignment within our company on our approach to open innovation.” Beyond communicating the benefits of an open innovation strategy, he underlines that the mere explanation of the concepts is very important: “What is it? What is it not? Those of us who are doing this every day thought that was crystal clear, and it turns out that it wasn’t as clear,” he explained. This relates to another aspect of the co-creation manager’s job: clarifying the concepts.
3) Explaining the concepts around value co-creation
When Pia Erkinheimo, former Head of Crowdsourcing at Nokia, was appointed, she had five things to do: Clarify and explain the concepts of crowdsourcing, set-up an innovative culture within Nokia i.e. organize internal crowdsourcing, find how to formulate the challenges and give feedback, try crowdsourcing providers and set-up collaboration methods, and communicate around the successes of collaboration with the crowd. As we can see, the first step in building this “systematic idea crowdsourcing capability in the context of open innovation” was to clarify the concepts.
To do that, Erkinheimo collaborated with researchers from Stanford University, Cornell University and Imperial College to write a whitepaper called “The Promise of Idea Crowdsourcing – Benefits , Contexts , Limitations.” This document explains what crowdsourcing is, how it can be used and what the benefits and limitations are. This work of clarification is crucial, especially when it comes to setting up the company’s general co-creation roadmap, which is another role of the co-creation manager. To go further, check out more visual representations of open innovation (as well as co-creation and crowdsourcing).
4) Establish and grow a partner network
Unilever’s current Open Innovation Portfolio & Scouting Director Roger Leech explained that “you need to define precisely what you want before you ask for it. And as solutions rarely come from a single individual or organization, the key is building a network of solutions partners that can work collaboratively around a specific project.” Strategic openness is all about finding partners to co-create value with.
These partners can be individuals, like inventors or creative individuals, who can be often accessed through crowdsourcing platforms and communities. In that case, the job of a co-creation manager is to identify the most suited intermediaries to work with in a variety of situations. In LinkedIn’s job offer to find a Crowdsourcing Program Manager, the company says that “the ideal candidate has the necessary experience of understand the trade-offs of working with crowdsourcing vendors.”
When the company is not looking for individuals, but for corporate partners, the process is slightly different. At Kraft Foods (now Mondelez), for example, the company sets up so-called Supplier Challenges. “We develop a challenge brief […] and then engage suppliers to innovate against that brief,” Steve Goers explained. “They have a period of time to develop a finished product or package innovation. They come back to Kraft and showcase their potential solutions with the management team.”
At General Mills, the best practice is also to organize and attend events to meet and reach suppliers. “We organize Supplier Summits to bring together our top suppliers to network, hear about the company’s business strategies and learn about specific partnership opportunities,” Belairs explained. “We go to open innovation conferences and talk specifically about our effort and the fact that we are open to innovation and looking for partners. So, we have a number of different ways that we’re trying to reach out and build additional relationships,” says the Senior Director of the company’s innovation network, G-Win.
The future for co-creation managers
"Companies that can bring in the right people to establish the new processes and structures will have a significant advantage" (Ross Dawson)
The more strategic open innovation and co-creation is, the more companies need dedicated people to manage it. “There are a whole set of new skills and capabilities that organizations require to tap the potential of distributed value creation,” says Ross Dawson, futurist and author.
Recent job openings like the ones at Lego and LinkedIn showed that there is an increasing need for people with “extensive experience in organizing and executing crowdsourcing projects,” who can manage collaboration with a diverse set of external stakeholders. Chances are that these people are (still) very rare and thus could be in very high demand in the near future.
"Even the largest, most complex organizations are getting better at building-up know-how and investing strategically in value co-creation as a source of competitive advantage" (François Pétavy)
François Pétavy, CEO of market leading co-creation platform eYeka, thinks that co-creation management will be one of the growing job trends of the future: “Co-creating with external stakeholders is the new frontier of innovation. To succeed, companies require exceptional managers who know how to drive mindset change and interface with highly creative individuals, experts or organizations that are not bound by corporate rules.
If you are looking to become a co-creation manager or add this competency to your CV, look back at the rise in popularity of social media. It was below the radar of most wannabe marketers before it became a must-have requirement to be hired as such. Start building knowledge and practical experience now to standout before everyone claims to be a co-creation expert. The know-how required can be acquired through practical experience but the diplomatic skills and the open-mind required need longer time to develop. And these cannot be crowdsourced as of yet.
Sources: Can crowdsourcing really crack corporate sustainability? (Guardian Professional Network), Building from the outside in (The Irish Times), Kraft-ed innovation (Packaging Digest), I was an open innovation sceptic (Taste of General Mills), A new approach to open innovation (Taste of General Mills), Improved packaging through collaboration (Taste of General Mills), Lego’s Open Innovation Strategy (15inno), Interview with Steve Goers and Nanako Mura (Innovate1st), The importance of internal alignment for open innovation (Openinnovatie.nl)
Yannig Roth graduated in marketing and is currently Research Fellow at eYeka and PhD student at University Paris1 Panthéon-Sorbonne in Paris (France). His main research interests are creative crowdsourcing and community cocreation. Yannig regularly blogs at http://yannigroth.wordpress.com
Why Design Thinking Will Fail
Posted on February 25, 2013 by Jeffrey Tjendra
Where there is a rise of a dynasty, there will be a fall of a dynasty.
Similar concept applies to the most-hyped innovation process; Design Thinking. If a process meets the current needs of the market, it escalates with monumental success. Not living up to the hype will be the cause of failure of Design Thinking as the sought-after innovation process. However there are good reasons why Design Thinking has been prominent in the recent years.
Design Thinking is a creative problem-solving approach with specific tools, methods and mindset designers are adept in. If doing the same thing over and over again brings the same results, doing things differently to bring pleasantly surprising results require creativity. Imagination is thus the root of creativity, as for which the semantic reasoning you may find here.
The essence of creativity in design is packaged to organizations as Design Thinking with the promise of delivering creativity in their business world of logic and analytics to solve wicked problems they’re constantly bombarded with. Design Thinking does this through understanding the users, making-sense of ambiguous information, re-framing opportunities, ecosystem conceptualization, prototyping to fail early and often. All this adds up to a creative process.
This creativity is one of the key essences of innovation. Advocated by the governments in Singapore, Finland, UK and Germany to name a few, Design Thinking has been implemented at all levels of organizations from start-ups to multinational corporations for less than a decade now. Engagements are typically conducted in workshop, or private settings by designers, design consultants and strategists.
With a variety of processes from different organization, a typical process in Design Thinking are involved several key steps:
Immersion: Immersion of a subject matter to gain market understanding and future trends from the macro level.
Ethnography: Understanding stakeholders in a subject matter to gain empathy and insights from the micro level.
Synthesis: Making sense of insights to identify and re-frame new opportunities and needs.
Conceptualization: Co-creating with clients to generate, combine ideas systemically into a concept ecosystem within the verified opportunities.
Evaluation: Filtering and selecting ideas based on the client’s strategic objectives and potential impacts.
Prototyping: Developing concepts from the selected ideas by low-fidelity prototyping required elements at low cost and iterate through user validation towards high-fidelity prototypes.
While these key steps have proven that it can deliver creativity to organization by providing qualitative value in innovation, it’s strength becomes its weakness because these steps are insufficient and unconnected to the reality. Therefore, innovation cannot happen until and unless there is an equal input from Business Thinking.
1. Misperception of Meaning The term Design Thinking has the impression of being perceived as an aesthetic tool used by the end of business process merely to beautify the products of an organization’s logical and analytical thinking. Thus there is an instant judgement on thinking with design means thinking only in terms of visual aesthetics of products and services.
2. Loss of Meaning The term Design Thinking also has been such a buzzword over the years that its meaning has become diluted by being overly and loosely used by amateur designers and business thinkers. It has come to the point where business owners and executives flee when they hear Design Thinking, but when framed as being creative, they return with a smile with a typical question – how can I be more creative in solving my needs and meeting my desires?
3. Misunderstanding and Not Accepting Creative Elements Organizations desire creativity but have difficulty of accepting the fuzziness, messiness, abstractness, and obscurity that come along with it. This is because in a world of logic, it doesn’t make sense for a systemic process to be fuzzy, messy, abstract and obscure as they are perceived as unpredictable, inefficient, ineffective and not measurable. Therefore it is hard for organizations to relate how tasks can be executed by the confused team and business objectives can be achieved using Design Thinking. This is the biggest obstacle organization cannot accept as part of their working process, but when they do innovation happens.
4. Lack of Business Elements Design Thinking attempts to use creative process to bring innovation in the areas of product, service, process and organization structure. However, innovation requires more than launched prototypes of concepts as the end result. It requires business modelling and business planning to create a more holistic approach to innovation. Business modelling allows the creation, exchange and maintenance of values created in an ecosystem. Business planning packages necessary building blocks in a business such as financial plan, marketing plan and operations plan to name a few, in order to implement and create real impact in the organization.
5. Language and Perspective Barriers Design thinkers consulting business thinkers are like human talking to dogs and vice versa. This poses problems for both at language and perspective levels from intuitive vs analytic, insight vs hindsight, abductive vs deductive, human impact vs ROI. The inability for both of them to meet halfway will result in an unsuccessful project, a frustrated relationship and a bad reputation towards Design Thinking.
6. Missing Future Design Thinking is a process designed to identify opportunities based on insights from the target stakeholders. These opportunities typically
decide the future direction of organizations. While acquiring insights are necessary to identify what the target stakeholders need right now, foresight is the missing link that will allow organizations to anticipate the future of what they do not know they need and desire.
7. Wrong Implementation of Process Because Design Thinking is packaged as a process to deliver creativity to organizations, it is natural for them to be implemented like operational process like Six Sigma. This becomes an attempt to maximize efficiency in creativity by turning it into a linearly gated and step-bystep process. Thus the value and effectiveness of creativity offered in Design Thinking is diluted and results becomes of an incremental innovation at best.
8. Poor Direction Scoping The process of Design Thinking starts with understanding the target stakeholders by immersing in their lives and the market.This is exactly what is misleading because the framing of where to play that guides the direction and strategic objectives of organization are missing. Without knowing where to go, the process becomes a misleading effort with the end result of incremental innovation at best. This is a wasted effort of the journey towards disruptive innovation.
9. Co-creation at the End of Process If designers and consultants are the process experts that guide champions or executives throughout the whole process, the clients are the industry experts. It is common for designers to be working in isolation away from the clients as the fuzzy front-end process of Design Thinking requires them to be dealing with ambiguity and uncertainty. This is one of the critical stage where buy-in from clients are necessary that can only be achieved by co-creation of process and industry expertise. Thus co-creation should not only be implemented towards the end of the process but from the beginning.
10. Misconception of Approach to Creativity Design Thinking preaches individualization and collaboration at certain stages of the process in order to generate breakthrough ideas. However, true creativity is a combination of both individual thoughts during Alpha state of mind and showcasing it to be improved by the team during brainstorming sessions.
11. Wishful Thinking for Culture of Innovation Implementing Design Thinking to become a mainstay culture of organization is one of the dreams the process hopes to offer. However, it is not enough for designer as consultant to establish the process because when he is gone there will be nobody to carry on the will in a premature design culture. What is required is an ecosystem of several elements; a customized and modular innovation process, the right senior leadership that advocates from top-down in creation of supporting, sponsoring, prioritizing and climatizing Design Thinking, and empowered ground-up employees lead by the process champion middle manager who is preferably a designer.
12. The End Process is not the End The end of Design Thinking process is to prototype and launch pilots to learn from the target stakeholders about the implemented concepts. As there is a start and an end to a process, Design Thinking doesn’t provide what is more essential towards the reality of the business world;
business modeling and business planning. Without integrating these two, buy-in from senior leadership and especially skeptics are more challenging.
13. Risk of Stagnancy A process used repetitively and efficiently become more risky in the long run. Until and unless the process is improved or a new innovation approach is discovered, Design Thinking will become stagnant as it will be replaced by a new process that addresses a more holistic needs more systemically and effectively.
With these reasons in mind, a change of striving towards excellence is required. What will come next after Design Thinking will be an evolution of how Design Thinking will be integrated towards business and becomes a process with synergy. A holistic process that combines the user and the market, analytical and intuitive, deductive, inductive and abductive. What will complement more from Design Thinking will be how strategy, leadership and culture can be fully integrated into the system with synergy which will have a dominant effect in shaping the future of business in innovation.
This article is written during my tenure as an innovation consultant at NBDA Asia; image credit: archaeology.org
Jeffrey Tjendra is a designer, researcher, strategist, consultant and entrepreneur passionate in innovation, design, and business. He has worked at commercial, academic and government organizations in Singapore Polytechnic, NBDA Asia, Ambient Experience Lab at OCAD University. He has experience working with various industries including healthcare, education, retail, and energy. Jeffrey is currently based in Toronto, Canada, traveling between Singapore and Malaysia.
Innovation REALLY Matters – Lessons Learned from Detroit
Posted on February 27, 2013 by Adam Hartung
Forbes republished its annual “Most Miserable Cities” list. It looks at employment/unemployment, inflation, incomes and cost of living, crime, weather, commute times – a pretty good overview of things tied to living somewhere. Detroit ranked first, as the most miserable city, with Flint, MI second. And my home-sweet-home Chicago came in fourth. Ouch!
There is an important lesson here for every city – and for our country.
Detroit was a thriving city during the industrial revolution. Innovation in all things mechanical led to the modern automobile; a marvelous innovation which, literally, everyone wanted. As demand skyrocketed, Henry Ford’s management team developed the modern assembly line which allowed production volumes to skyrocket as well. Detroit was a hotbed of industrial innovation.
This fueled growth in jobs, which led to massive immigration to Detroit. With growth the tax base expanded, and quickly Detroit was a leading city with all the best things people could want. In the 1950s and 1960s Detroit reaped the benefits of the local auto companies, and their suppliers, as ongoing innovations drove better cars, more sales, more revenue taxes, higher property values and higher property taxes. It was a glorious virtuous circle.
But things changed.
Offshore competitors came into the market creating different kinds of autos appealing to different customers. Initially they had lower costs, and less expensive designs. Their cars weren’t as good as GM, Ford or Chrysler – but they were cheap. And when gasoline prices took off in the 1970s people suddenly realized these cars were also more fuel efficient and cheaper to maintain. As these offshore competitors gained more sales they invested in making better cars, until they had quality as good as the Detroit companies, plus better fuel efficiency.
But the Detroit companies had become stuck in their processes that worked in earlier days. Even though the market shifted, they didn’t. What passed for innovations were increasingly simple appearance changes as bottom-line focus reduced willingness to do new things, and offered fewer new things to do. GM and its brethren didn’t shift with the market, and by the 1980s the seeds of big problems already were showing. By the 1990s profits were increasingly variable and elusive.
The formerly weak and small competitors now were more competitive in a changed market favoring smaller cars with more, and better, technology. The market had changed, but the big American auto companies had not. They kept doing more of the same – hopefully better, faster and striving for cheaper. But they were falling further behind. By the 2000s decade failure had become the viable option, with both Chrysler and GM going bankrupt.
As this cycle played out, the impact on Detroit was clear. Less success in the business base meant fewer revenue tax dollars from less profitable companies. Cost reductions meant employment stagnated, then started falling. Incomes stagnated, and people left Detroit to find better paying jobs. Property values began to fall. Income and property taxes declined. Governments had to borrow more, and cut costs, leading to declines in services. What had been a virtuous circle became a violently destructive whirlpool.
Detroit’s business leaders failed to invest in programs to drive more new jobs in non-auto, non-industrial, business development. As competitors hurt the local industry, Detroit (and Michigan’s) leaders kept trying to invest in saving the historical business, while the economy was shifting from an industrial base to an information one. It wasn’t just autos that were less valuable as companies, but everything industrial. Yet, leaders failed at attracting new technology companies. The economic shift – the market shift – was unaddressed, and now Detroit is bankrupt.
Much as I like living in Chicago, unfortunately the story is far too similar in my town. Long an industrial hub, Chicago (and Illinois) enjoyed the benefits of growing companies, employment and taxes during the heyday of industrialism. This led to well paid, and very well pensioned, government employees providing services. The suburbs around Chicago exploded as people migrated to the Windy City for jobs – despite the brutal winters.
But Chicago has been dramatically affected by the shift to an information economy. The old machine shops, tool and dye makers and myriad parts manufacturers were decimated as that work often went offshore to cheaper manufacturers. Large manufacturers like Western Electric and International Harvester (renamed Navistar) failed. Big retailers like Montgomery Wards disappeared, and even Sears has diminished to a ghost of its former self. All businesses killed by market shifts.
And as a result, people quit moving to Chicago – and actually started leaving. There are now fewer jobs in Illinois than in the year 2000, and as a result people have left town. They’ve gone to cities (and states) where they could find jobs in growth industries allowing for more opportunity, and rising incomes.
Just like Detroit, Chicago shows early signs of big problems. Crime is up, with an unpleasantly large increase in murders. Insufficient income and property tax revenues led to budget crises across the board. Dramatic actions like selling city parking meters to shore up finances has led to Chicago having the most expensive parking in the country – despite far from the highest incomes. Property taxes in suburbs have escalated, with taxes in collar Lake county higher than Los Angeles! Yet the state pension system is bankrupt, causing the legislature to put in place a 50% state income tax increase! Meanwhile the infrastructure is showing signs of needing desperate work, but there is no money.
Like Detroit, Chicago’s businesses (and governments) have invested insufficiently in innovation. Recent Chicago Tribune columns on local consumer goods behemoth Kraft emphasized (and typified) the lack of new product development and stalled revenue growth. Where Bay
Area tech companies expect 50% of revenues (or more) from new products (or variations), Kraft has admitted it has relied on stalwarts like Velveeta and Mac & Cheese so much that fewer than 10% of revenues come from anything new.
Culturally, too many decisions in the executive suites of both the companies, and the governments, are focused on what worked in the past rather than investing in innovation. Even though the vaunted University of Illinois has one of the world’s top 5 engineering schools, the majority of graduates find they leave the state for better paying jobs. And a dearth of angel or venture funding means that start-ups simply are forced coastal if they hope to succeed.
And this reaches to our national policies as well. Plenty of arguments abound for cutting costs – but are we effectively investing in innovation? Do our tax policies, as well as our expenditures, drive innovation – or constrict it? It was government programs which unleashed nuclear power and gave us a rash of innovations from putting a man on the moon. Yet, today, we seem obsessed with cutting budgets, cutting costs and doing less – not even more – of the same.
Growth is a wonderful thing. But growth does not happen without investment in innovation. When companies, or industries, stop investing in innovation growth slows – and eventually stops. Communities, states and even nations cannot thrive unless there is a robust program of investing for, and implementing, innovation.
With innovation you create renewal. Without it you create Detroit.
image credit: demounderground & atlasis
Adam Hartung, author of Create Marketplace Disruption, is a Faculty and Board member of the Lake Forest Graduate School of Management, Managing Partner of Spark Partners, and writes for Forbes and the Journal for Innovation Science.
Design & Innovation with Robert Fabricant, frog design
Posted on February 24, 2013 by Lou Killeffer
Founded in 1969, frog’s more than 1,000 designers, strategists, and software engineers work with the world’s leading companies to design, engineer, and launch meaningful new products and services. Central to this is frog’s expertise in delivering connected experiences across a variety of technologies, platforms, and media for a broad spectrum of industries.
Robert Fabricant is Vice President, Creative for frog New York, where he leads multidisciplinary design teams for clients including the BBC, Comcast, GE, MTV, Nextel, and Nissan. Robert has developed user experiences for a number of digital platforms spanning handheld devices, medical devices, retail environments, networked applications, and desktop software. Active in design for social innovation, he recently led Project Masiluleke, harnessing the power of mobile technology to help combat the world’s worst HIV and AIDS epidemic in KwaZulu Natal, South Africa.
In 2009, Robert joined the faculty of the School of Visual Arts in New York. He’s a faculty member of the Pop!Tech Social Innovation Fellowship Program and an adjunct professor at NYU’s Tisch School of the Arts. A regular speaker at conferences and events, he’s also a frequent contributor to a variety of publications, including I.D. Magazine, The Wall Street Journal, and Wired.
Robert, as he’ll gladly tell you, is a talker; one with an informed and fascinating perspective. We had a wide ranging talk as he noted the explosion of interest in the term “innovation”; what it means to him today; the difference between introverts and extroverts and the inherent social aspects in sorting and sharing solutions; and the growing, perhaps fundamental, role of creativity across business broadly.
I met Robert over morning coffee in frog’s Manhattan offices in the SoHo neighborhood at 325 Hudson Street.
Lou Killeffer: Robert, to begin with, what in your view, or Frog’s, is innovation?
Robert Fabricant: I largely leave it to the academics to debate that topic because at this point I think it’s virtually impossible to come up with a useful definition of the word.
LK: Why is that; why impossible?
RF: Because I think innovation’s come to represent a lot of things in our culture; a lot of things that I see as quite positive. Five or six years ago I felt a certain sense of concern as part of a company that’s taken technological advances and breakthroughs and turned them into meaningful products and services – which could be a workable definition of innovation. I felt that as a company, frog, had a rich equity in what I’ll call new product development and I felt some concern over the wide spread explosion of the term “innovation” because I felt that it risked taking some of the things we were quite good at and dumbing them down. But my perspective’s changed. Now I see innovation more as a cultural phenomenon that’s come to represent a shift in the way people think about work, about business, and the meaning and value of what they do on a day-to-day basis.
LK: Tell me more.
RK: I believe innovation opens the entire business environment to a more creative perspective on the role of work and the value that we create as we all engage, and build, and collaborate. I think in that sense it’s quite remarkable because it creates a new license for creativity, collaboration, and communication; if along the way the term innovation itself becomes stretched out of recognition into a signifier, personally, I’m comfortable with that.
LK: Putting aside small-minded people like myself (smiles) trying to get to a singular definition; I find your perspective quite wise. You say this represents a change in your own opinion. What changed your opinion? What’s happened to mark the change; what was the spark?
RF: Well, it wasn’t a one-time thing. If you’re looking for an inception moment…
LK: There is none.
RF: Right. But I will say, as a designer, when you find yourself in a defensive posture resisting an explosion of interest in the world, you have to ask, “Am I in the right position as a creative person trying defend the territory around innovation?”
Ten to fifteen years from now a more comprehensive theory of innovation may well emerge retroactively, one that’s does a great job of explaining this moment, but that won’t come from me. I simply found myself resisting this sense of over use. You have to think okay, there’s a huge amount of energy and interest here. There are more different ways to engage with organizations than before. There’s a new enthusiasm at a very individual level, not just a company level, as I work with people on initiatives inside and outside the business sector. Just tremendous enthusiasm and interest. So you have to say okay, how can I shift my own mindset around and get past that defensive posture.
LK: It seems the seed of innovation has expanded through business culturally to society. What a great time to be a designer…
RF: The word you’ll hear me use a lot more than design is creativity. I grew up as a creative kid. I always hung out with the creative kids. (smiles) For me, creativity is a very fundamental quality of being human and connected to the world. Design has a strong relationship to creativity as a way of applying it toward a specific result. But as I work more broadly and globally, creativity is the word that I come back to more than design, or design thinking.
I want to come back to the question you had before because you were looking for an example. One that’s kind of interesting is the work we did for the Nike Foundation, which is devoting its resources to something called the Girl Effect, which is essentially reaching out and removing the sense of isolation that girls have as adolescents. Increasing their sense of opportunity. There are great studies that show if you look at society and measure opportunity for girls, particularly their ability to increase their economic effectiveness, it translates into huge results from a development perspective.
We were hired to help them think through how you breakdown barriers to getting girls engaged, sharing experiences, learning from each other and building skills as leaders in their communities. And then how do you do it on a larger scale, not just through the kind of hands on community groups that they already fund but as a kind of network of girls.
We ran workshops at a few different places. Our team, I wasn’t there, ran a workshop in Bangladesh with a group of adolescent girls, twelve to fifteen-year-old girls, taking them through a three-week process, and developing a methodology that we call the Collective Action Toolkit (CAT). It’s girls getting together, sharing experience, coming up with ideas for things they want to learn about their community, feeling empowered through the design process.
That’s where design and creativity play kind of nicely together. Feeling empowered to ask questions. Having permission to act differently in the community because they were part of a design process. We gave them badges and they had some credentials and then went out into the community and interviewed people that they admired. Something they could have done any day of the week but never felt they had the license to do before. They came back with this knowledge and we wanted to share that knowledge and see if we could generate ideas together.
So when we think about design and design thinking, I think one of the most meaningful things is when you find yourself in situations where you can peel back the layer from design thinking to the basics of creativity and collaboration, how to connect people, how to share ideas to create shared value. That’s the real promise of all of this enthusiasm around innovation. How do you take that kind of an approach and engage a much broader, global community? That for me is far more interesting than trying to defend the high ground of what innovation is.
LK: It’s interesting. The Internet and globalization and the continued “shrinking” of the planet all indicate greater openness across the board. Everyone I’ve spoken with says being open is the only way to innovate. Today from a cultural standpoint that’s clearly one of the most powerful, or certainly most desired dynamics, isn’t it? I think it speaks well for the future. You’ve mentioned kids a couple of times. Can creativity be taught? Can innovation be taught?
RF: I think creativity has a lot to do with what happens between people and that we’re all extremely social creatures. I don’t think we started painting on cave walls or making fires because an individual sat down alone and thought, “I want to tell my own story”. I think these things all came out of creative, collective moods and moments. Even when they happen in isolation. There’s been a lot written recently about Bell Labs and the need for people to work individually to continue to drive breakthrough thinking. I believe that, I do. But I still believe it’s a social response. It comes out of a meeting you had two weeks ago knowing that you’re going to be back talking with your colleagues, whether it’s in the lunch room or the board room. There’s always a social dynamic at play even when we’re working and thinking things through on our own.
LK: That’s a fascinating point. The lone artist as hero has been revered from Michelangelo to Steve Jobs. Why shouldn’t we assume that for the genius pushing against the universe – in meeting, after meeting, after meeting – there were moments in the iterative process where his or her individual ideas were strengthened or improved?
RF: I’ll take it a further step back. Let’s say that in those meetings, not a single thing that anyone said directly made the idea better. My guess is when he’s thinking it through on his own – I’m not going to put myself in Steve Jobs’ mind but whoever it is at their desk – it’s still shaping how they think and the meaning they see in what they’re doing. I think that’s true for everyone except the most technically minded people.
One of the things that I find fascinating as a designer is the first moment you put your idea in front of someone else. Coming back to the point you just made, there are two memes out there. One is that genius is isolated and comes up with its own idea. The other is that the minute I put it in front of you, you and I will start a dialogue, and out of that dialogue, a better idea will emerge. I want to focus right in the middle. At the moment I put it in front of you, I see it completely differently. It may have nothing to do with what you say. You may contribute zero value.
LK: Yes, of course, but at the moment of sharing, everything, by definition, just changed.
RF: It just changed. (smiles) That moment, as every designer knows, is an exquisite one where time stops or slows down. In that split second they’re thinking, “Oh let’s stop this, I know exactly what I need to know.” and they want to go back and redo that session two days later. Because of that awareness or recognition, that empathy of seeing through someone else’s eyes. I think, coming back to your question about creativity, that ability to make connections between different observations and experiences is critical. I think that is fundamental to people, all of us, inherently.
LK: When you speak path to market that suggests application in the real world and how to take an idea and make it tangible and successful as a business proposition. Is that in fact what frog does?
RF: That’s not all we do.
It’s certainly the tradition we come out of, doing that kind of idea to market work, and it’s still our greatest sources of pride, when an idea not just reaches market but successfully changes people’s sense of value and possibility. But we also drive change in areas where there is no established market or the marketplace is not the kind of environment in which you’re trying to create value.
We do a lot of work in the social sector, initiatives where a lot of what you’re trying to do is shift the sense of empowerment, the sense of possibility and the welfare and livelihood of people in different sectors. Like our Nike Foundation example. And in these other areas the credibility we have is significant. When I go to talk to UNICEF about how to shift the way they think about programs they fund, about how to engage communities, provide greater feedback and understanding about who they’re reaching and what value they’re creating. The fact that we come from the discipline of taking products to market is huge. One of the challenges we face in those moments of defensiveness is that some of the people talking innovation simply don’t have that discipline. They don’t do so well held to that standard. But having that discipline is something that helps keep you honest.
LK: Keeps you grounded. Gives you credibility.
RF: It keeps you grounded and continues to help you develop the skills you need.
Today some of the most valuable new businesses being created see their key asset as the user experience, and the design and way the business engages with people. For that reason, we find ourselves doing more than design “thinking”. The start-up market is very disciplined and really shows how quickly people can create, test and collaborate on ideas. The big, established businesses are extremely jealous of that. Extremely jealous.
There’s a generation of business leaders that are going to migrate into more senior roles and larger scale companies who’ll come out of startups as their training ground. They’re coming out of Harvard Business School now and deciding, “Do I want to go to work for McKinsey or Goldman or do I want to do a start up?” Those things aren’t even on the same level right now. And there’s no question, most of these people would rather do the right start-up. Eventually they’re going to be the CEOs of divisions at General Electric or P&G or whatever. And you know what, their experience and the way they want to do business will be different as a result.
Again, being part of a forty year old company, looking at frog ten, fifteen, twenty years from now, that’s the leadership we want to work with. We want to be a company they feel embodies the process that can help them work in a direct, lean, market-driven way.
LK: What a remarkable portfolio: traditional new product design, the start-up sector, the cultural change being driven by enlightened corporations, like the Nike Foundation, and the NGO arena exemplified by UNICEF. How does the business or your portfolio divide between those things?
RF: I’m fascinated by the way that social impact initiatives energize our design community. Those situations are full or urgency. Right now one of the things we’re doing a lot is trying to bring our corporate clients into those partnerships. Because we can work together in an environment where there’s a drive for more openness based on achieving a broad societal goal as opposed to a competitive business position. I think it’s very important to bring that experience to corporations, collaborating with non-traditional partners. It’s a great place for us to learn. I can’t tell you if that kind of work is 20% of our business based on the revenue from those customers. But if you look at its overall value to our business, I think it’s significant in the way we think about how you approach some of the broader problems that our traditional customers are coming to us with.
LK: What sort of people work at frog? What skills do they need to have?
RF: It’s not a one size fits all but nonetheless there are a couple of skills you have to be interested in building in a place like frog. One of those skills is storytelling. It’s critical. The other is a kind of empathy and engaging openly with teams, clients, partners, customers, and communities. You really have to have that curiosity and interest. And some people who have that are very introverted. Sometimes we gloss over the notion of introverts. I work with a lot of introverts. Many of them are quite perceptive and they appreciate and learn a lot from being in situations that are highly collaborative. They just don’t want to be the one at the front of the room facilitating the collaboration.
LK: They have something to offer.
RF: They don’t have to be extroverts. Very often the most meaningful moments are when you sit down with them and three days later you see what they’re doing or they take ten minutes to express something that is important in their life. That level of openness and willingness to make connections is critical. The ability to throw out your work and not get too precious about it. This isn’t a good place for people who feel too dedicated to the idea or design that they came up with one day. It’s about the willingness to experiment. These all sound very obvious but it takes time to create an environment where people feel comfortable doing that. It’s not just the stuff that happens in between the work, it is the work.
LK: That’s consistent with what I’ve heard from others, though you’re the first person to mention storytelling as critical. I see storytelling as the net sum of curiosity, empathy, and engagement. What’s so critical about storytelling? Is it engaging with another person; taking them from point A to point B?
RF: There are a couple of interesting things about storytelling.
A lot of the experiences that we’re trying to create with our customers in their communities and the marketplace happen over time. Where design is getting more sophisticated is not just looking at individual products and services but how do they relate to each other over time. What are the key points of connection or alignment? That idea is hard to hold in your fucking head. It’s really hard to hold in your head. Very often the exact design space that we’re trying to solve for is an experience over time. It’s a story. There’s no better way to express it. And companies can solve in product or service touch points across that narrative and still completely miss the opportunity. So that’s the first place storytelling is critical.
The second place is when you take designers, and again this is just talking about what I do at frog, who are brilliant at what they do and you say, “Okay, you’ve a great idea for this product, don’t just show it to me, tell it to me in a story.” It’s great training for designers. It forces them to think about it from another perspective, because it’s hard to tell a story to yourself. In a sense as you were saying, it becomes a Trojan horse for empathy and putting all those pieces in connection with all those other pieces. So that’s another place for storytelling. It’s really valuable and it’s going to help you communicate your ideas better to your customer, to the members of the team. It’s going to help you see what’s most valuable in your ideas.
Storytelling is big and I’m not here to tell you we’ve some scientific approach to it. But when you look at filmmaking, for example, you see the way to build narrative. We’re radically ramping up our use of video in all we do. These things are becoming very necessary creative skills. And of course stories travel really easily online.
LK: And very quickly.
RF: And very quickly. (smiles)
LK: You know design firms seem to be all about managing change; facing change and dealing with it, embracing it.
RF: And sparking it.
LK: Right, as opposed to being whipped around by it.
RF: Yes, although at the same time I see a much stronger appreciation of the role of product design and creativity as fundamental skills in new start-up companies. Not just design as some add-on once you have the business model. That’s fantastic. My hope is designers will become more mature in their ability to think as entrepreneurs; building and sustaining organizations and cultures to drive change and the products and services that will drive that change.
When you really consider where the design community is today, it needs to grow up.
I think this is the right moment for that change to happen and there are a lot of positive signs that it is. If we could see ten years from now, let’s say two important things happen. That new generation of start up leaders who’ve migrated now have more influence in business. So you get that generation of leaders in place. You also get designers who’ve put more of their own money and credibility at stake in the market. They’ve gone through the pain and understand the difference in not just having an idea but developing it all the way to production, with the responsibility of running and building a business around it.
I think these two dynamics will converge. It’s not a short-term proposition but why wouldn’t they converge in the next ten to fifteen years? That’s the moment when a frog will sit at the same table with McKinsey. We talk about it today. But I think that’s when you’ll see the true potential of business, consulting, and creative skills developed.
LK: I agree with you and I think it’s already underway. You’ve spoken about the application of innovation to social issues. Is there a problem you or frog would particularly like to address?
RF: Well we’ve touched on one in passing here which is the role of creativity in education. I think that’s huge…
We’re fortunate in that we have a lot of meaningful partnerships that allow us to play a role, even if just a contributing role, in helping organizations address some big social issues. Whether it’s health or economic development or gender discrimination. These are big topics. One of the challenges with them is they become very, very serious to people. And one of the key things designers can bring to these topics is helping people get that monkey off their back a little bit. You can only think about these as such serious and heavy topics for so long.
LK: We’re all human here.
RF: We’re all human here. And the truth is, we’re very committed to trying to be a useful ingredient in how people develop broader solutions to these topics.
LK: Robert, I think frog, and the rest of the world by extension, are lucky you can’t pick just one. Thanks for your time and a wonderful conversation.
RF: Sure, Lou. You’re welcome.
copyright Lou Killeffer November 2012 All rights reserved. Five Mile River Marketing.
image credit: poptech.org
Lou Killeffer is a Principal with Five Mile River Marketing. A versatile marketing strategist, Lou’s passion for communications and innovation has made him a trusted advisor to some of the world’s most enduring businesses and brands, from AT&T to UPS, where he helps enterprises embrace change, look ahead, and focus on sustaining success
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