In a recent article, consulting company AT Kearney, states that an innovation leader:
- designs an organization focused on open innovation
- crafts gain-sharing agreements with partners
- use change-management principles to move the organization toward open innovation
These are just a couple of characteristics of innovation leaders. You can learn more by downloading the article in this post or visit this link: Innovation Management – strategies for success and leadership
I just had an interesting exchange with a guy who just can’t see that open innovation will become a major part of how most companies innovate.
Among other things, my counterpart mentioned that barriers against open innovation are there for the purpose of keeping innovation inside the company or the country because innovation has value and thus means power.
Another point he made was that “great ideas come from an individual’s mind. I’m not saying that in a group situation, an individual’s idea couldn’t be improved, but for that individual to give up that idea before it is patented and protected, that inventor isn’t saying anything to anyone. That’s because the reward for that great idea is more profound to the innovator if it is his alone to market. Again, in my personal opinion, this is a good thing. Reward brilliance accordingly. Once the inventor has the patent, sure let anybody who wants to improve upon it, have at it.”
It has been a while since I have heard anyone talk against the idea of open innovation, so I sent a reply that went like this:
—-
Hi Steve,
You are not way off target on what I mean by open innovation. This is also why I have a slightly provocative message to you: Wake Up!
The early stages of open innovation already take place in a lot of companies and it is one of the most talked-about-things in the world of corporate innovation today. You should start looking into this as we are definitely in the process of tearing down those barriers you mention.
Why? Because we live in a global world where information is becoming more accessible and transparent. This makes it easier to innovate across barriers. It is also a bit arrogant for companies to believe they know everything by themselves.
Take P&G. Eight years ago they learned there were 200 researchers and scientists just as good or even better outside P&G for EACH of their own 7,500 researchers and scientists. P&G choose not to be arrogant and rather explore ways of working with these 1.5 million great minds. Today, they do not have an R&D department. It is called C&D – the C stands for connect and they are close to reaching one of their amazing goals: 50% of their innovation should to some extent come from external sources. Check this link for more on P&G and open innovation: http://hbswk.hbs.edu/archive/5258.html
Another point is that we live in a networked world where you work with partners and customers to bring innovation to the market. It has become very difficult to this by yourself. Just look at the new planes from Airbus and Boeing. Their global supply chain is just as much an innovation chain generating new products, services and processes.
We have just started to embrace open innovation and this is a movement that will not be stopped…
BTW – Intellectual Property Rights is a key issue, but this can be worked out.
Stefan
What a company knows is inside the heads of its people, and distributing this knowledge has always been a challenge. Yet, now more than ever, being able to leverage a company’s collective knowledge and experience through virtual and face-to-face networks and communities is critical to innovation. So why do such efforts fail so frequently? Here are some of the reasons I’ve identified as I’ve worked with companies on this issue:
1. Time and skills
Many of us simply do not have the time or skills to network and build relationships. Leaders, you need to give your people time to acquire networking skills and the time to invest in and maintain relationships.
2. Focus
A community will only work if it connects people who share a common experience, passion, interest, affiliation or goal. Create and/or find a group that’s right for you. You should also keep in mind only to network or build relationships if you have a reason to do so. Random networking rarely results in anything but wasted time.
3. We are too old…
Most people above 30 years old just don’t see the value of tools such as Facebook and LinkedIn. We have a real generation gap here. We, the older and wiser ones, are still in charge, but this will begin to change in five years time as we get the first leaders from the Facebook generation. Ten years on, they will define the rules. Why not try to figure out how it works now instead of waiting?
4. Lack of commitment, structure and culture
As companies embrace open innovation, internal and external networks will explode. This includes peer-to-peer, value or supply chain networks and networks that feed ideas and/or technology. Company leaders must commit to a networked organization and create the structure and culture needed for this to work.
5. Lack of a dedicated facilitator
Almost any network can benefit from having a dedicated facilitator who really cares about the topic and the participants. Although this might add to the costs of networking, the return on the investment will be higher.
I often talk with innovation leaders who believe their company does well on innovation. This contrast what the below people further down the org chart says.
Are leaders generally on the same page as their employees or do they tend to exaggerate the state of the organizational innovation capabilities?
What is your take on this?
I am giving a talk on networking and relationship building tonight. I have given many talks and workshops on this topic and I have learned that the best way to help people become better at networking is to create something close to a coaching sessions. I prefer getting into real issues trying to guide a volunteer with an issue on the spot. The volunteer gets a free coaching session and the other participants learn by listening and helping out.
More often than not, people have the same issues on networking. This evolves around career development and getting things done. The career stuff is more long-term and strategic whereas the latter is much more operational driven.
It will be fun tonight where I will get into parts of my latest article — see below and this link: Are You Ready for the Next Generation of Innovation?
Relationship building
As we move towards open innovation, companies have to be able to identify and establish partnerships that complement their own business capabilities. This requires people who are experts at networking and building relationships.
Rob Cross, an associate professor in University of Virginia’s McIntire School of Commerce, has identified three networking types that you should pay attention to within an organization: central connectors, brokers, and peripheral people1.
Central connectors are those people with the highest number of direct connections. They can be formal leaders–or political players trying to be leaders–who everyone seeks out either because they make things happen, or because they have made themselves bottlenecks.
The latter can become a major problem with regards to innovation where you often need a dynamic flow. Some experts are also central connectors and this could lead to an overuse of these people as everyone goes to them with questions. Sometimes you need to protect these experts.
Brokers connect people across boundaries, such as functions, skills, geography, hierarchy, ethnicity, and gender. They have ground-level credibility and acknowledged expertise in the eyes of their peers, which makes them more likely to be sought out and listened to than a designated expert or leader who might not be influential in the network.
According to Cross, brokers often sit in “tipping point” positions and so diffuse information faster than leaders and central connectors. As such, brokers have the leverage ability to drive change, diffusion or innovation and they can also act in key liaison or cross-process roles.
You should also be aware of peripheral people who could be new people, experts, sales people, poor performers or cultural misfits. They sit on the edge of the network, and Cross has learned that typically 30 to 40 percent of peripheral people are trying to get better connected but have run into obstacles. These people reflect untapped expertise and are substantial flight risks.
Once you gain a better understanding of these networking types, you should ask yourself what type you are and how this impacts your future goals and your ability to work with open innovation projects. Working with innovation, you have to deal with all three networking types and you should also try to understand how to work best with the different types. This is especially important if you are a manager or leader.
Besides this introduction to networking types, let’s look at some ways of maximizing the effectiveness of your networking efforts:
• Only network if you have a purpose: I strongly encourage you not to listen to the people who say you should network with everyone within sight so as to not risk losing any opportunities. You are already busy and time is the most precious thing you have, so do not spend time on activities that do not serve a higher meaning.
• Leverage the power of “six degrees of separation” to reach anyone in the world: This refers to the idea that if a person is one step away from each person they know and two steps away from each person who is known by one of the people they know, then everyone is an average of six “steps” away from each person on Earth. Think of someone who could really influence the success of your innovation work and see how many steps it would take you to connect with that person. You’ll often be surprised that you don’t even need six steps; it can often be done in just three or four connections.
• Use virtual tools: A growing number of online tools and services make networking so much easier. I use LinkedIn, the largest online business networking site, which is great for managing my network. The discussion features of the LinkedIn groups tool has also proven to be a powerful and simple way for me to engage people from across the world in productive discussion about my areas of interest. You can do the same.
• Understand informal versus formal network leadership: In an open innovation eco-system, you need to know the influencers who are not on the formal organization chart. They are the people who hold disproportionate influence on other people. Get to know the powers behind the throne.
• Reason, ask, and tell: Prepare reasons for getting in touch with other people. This goes both ways. Once an interaction such as a brief encounter or a meeting is over you should always remember to ask people how you can help them and let these people know of any ways they might be able to help you. Nothing happens if you do not ask.
• Speak-write-meet: You can use several means to build your personal brand which again impacts the kind of relationships you can build. Some people are great speakers, others write very well, while others are great with people. Find your strength and build on that. You should also consider how your team can cover all these aspects of what could be called team branding.
Check out this interview with the CEO of IDEO, Tim Brown.
IDEO – www.ideo.om – is an innovation machine; a designer of products, services, and experiences ranging from Apple’s first mass-market computer mouse to aspects of Prada’s store in New York City to the patient-care delivery model at SSM DePaul Health Center, in St. Louis, Missouri.
The interview is by McKinsey. The combination of IDEO and McKinsey can’t be wrong and it is not. The article is short article but it definitely has some good points to think about. Check out this link: Lessons from innovation’s front lines: An interview with IDEO’s CEO
Registration is required.
Ten Types of Innovation by Doblin - www.doblin.com
The way business takes place in most companies is that you have people trained at the skills or functions they are working with such as R&D, production, sales/marketing, and finance. Of course, you have cross-function teams, but generally you try to excel in one area.
Not long ago, I had the pleasure of meeting with Paul Campbell, who is a true intrapreneur at Hewlett-Packard. Paul is working on his fifth internal startup and is now a Vice-President in HP’s Voodoo Gaming PC business. We talked about what characterizes intrapreneurs, and Paul said that an intrapreneur must have the ability to see and pursue possibilities by piecing together innovations across three or more business functions simultaneously. Paul emphasized that successful intrapreneurship requires this level of innovation to differentiate it from standard business growth initiatives. This contrasts sharply with most people who are only trained to do one thing at the time. But in order to be an intrapreneur, you need to think like a composer, not a musician.
Not only do you have to think and work across business functions, you also have to innovate across the key areas of business when you move from ideas and research to revenue. Doblin has made some groundbreaking research showing that 96 percent of all innovations fail to meet their targets – not necessarily because companies perform poorly at the core product or service innovation, but more often than not because companies fail to follow through with innovation in other key areas of their business. Businesses must be able to master all types of innovation – everything from business model innovation to innovation of products, processes, and services. This “whole picture” approach is important in delivering successful innovation, and is another key part of collaboration.
On a more personal level, consider whether or not you are a “T-shape.” Innovation consultancy IDEO uses this term to describe people who are more likely to thrive with innovation. You should bring superior in-depth knowledge as an engineer, sales person or something else to the table. That is the vertical part of the T. But you should also have the breadth and empathy – the horizontal part of the T – to understand and appreciate the skills that other people bring to the table as you work as a team to become successful with your innovation projects.
As a T-shaped person, you accept that you don’t know everything and have the courage to seek help and advice from others. Gain a broader perspective by learning from those whose experience and views differ from yours.
Article: Strategy & Innovation: Are You Ready for the Next Generation of Innovation
My latest article was published in Strategy & Innovation. This is a newsletter run by Innosight which is an innovation consultancy built on the disruptive innovation frameworks developed by their founder, Harvard Business School professor Clayton Christensen.
In the article, I argue that companies have begun to embrace open innovation and more collaborative forms of innovation and that this move requires a new mindset and a new set of skills; it is no longer enough to just be a good project manager, researcher or engineer – or leader. The skills that need to be mastered are:
• Collaboration: You have to work across business functions and with many types of innovation to turn ideas into profitable products, services or business methods.
• Relationship building: In a world of open innovation, you need to be an expert at networking and building relationships.
• Stakeholder management: You do not need to have everyone on your side, but you need to generate adequate support to champion your ideas and enough leverage to overcome major hurdles.
• Communication: You need to be able to craft compelling messages to the stakeholders you want to influence.
Do you think you are ready for the next generation of innovation? Read the article and let me know what you think.
There is not doubt that innovation leaders and intrapreneurs have lots of drive. They make things happen and this is one of their key qualities. But there is also a thing such as too much drive.
I recently had a couple of incidents where this became very clear. Both incidents evolve around people in new jobs. They have been hired to bring change to their organizations and they are eager to show their capabilities. They are actually doing a great job having started several successful initiatives. But they want even more – and faster.
And then they forget that they have some fairly unique capabilities. Most people do not have a similar drive and even more people prefer status quo over change. When such types collide, the people with drive get frustrated and they might even start to doubt their own capabilities and whether they belong to this new organization.
The strange thing is that they have every opportunity to be successful. During these incidents, I was lucky enough to also get an executive perspective on this. The company leaders would be happy if the innovation leaders had started just a third of the initiatives they had undertaken. The thing is that people with drive sometimes move too fast for others to keep up with them. Or they may set the bar higher than other people are prepared to reach. Also, people with drive sometimes are moving so fast that they fail to communicate fully with others about where they’re headed and why others should follow.
There are two lessons here. Manage your stakeholders and be prepared to adjust your goals and expectations. Always keep in mind that the change you are so eager to bring about affects other people, who can put roadblocks in your path if they think you’re going too far too fast. Identify and map these people and get a sense of how they feel about the things you want to change. Do this not only during the preparation of new initiatives but also during the implementation. This will also give you a better understanding of what success looks like. Maybe you also have to adjust – up or down – on this.
In A Whole New Mind, Daniel Pink, a best-selling author who focuses on the changing nature of work, argues that we have moved from the Information Age to what he labels the Conceptual Age. In this new age, he posits, certain skills associated with the right side of the brain are of increasing importance. As it happens, these skills are also highly relevant to the world in which innovation leaders and intrapreneurs work.
But before we turn to the specific right-brain skills Pink discusses, let’s look at what he means by the Conceptual Age. In the Information Age, left-brain attributes–logical, sequential, analytic, textual, and functional reasoning–dominated. The most valued worker (and, ergo, the best-paid) was the knowledge worker. These skills are obviously still valuable, but, says Pink, they are no longer the sole drivers of business success they once where due to three factors:
- The abundance of affordable goods in developed countries, where consumers now take for granted manufacturers’ ability to churn out reasonably priced, adequately functioning products. Instead, they increasingly seek producers who create something aesthetically pleasing that will stand out among the glut of products. In other words, knowing where to find the cheapest raw materials, how to crank up factory production, or how to manage the supply chain are all still important but by themselves will not win the competitive battle.
- The emergence of Asia’s massive outsourcing capabilities, which means much of the knowledge work formerly so valued in the developed world can now be done much cheaper overseas.
- The automation of information, which is impacting white-collar workers in the same way factory automation hit blue-collar workers a generation ago.
The Information Age is being replaced by an era of high concept, which Pink defines as “the ability to create artistic and emotional beauty, to detect patterns and opportunities, to craft a satisfying narrative, and to combined seemingly unrelated ideas into a novel invention.” It will also be an era of high touch, which Pink says “involves the ability to empathize, to understand the subtleties of human interaction, to find joy in one’s self and to elicit it in others, and to stretch beyond the quotidian, in pursuit of purpose and meaning.”
In such a world, right-brained attributes, such as holistic, intuitive and nonlinear reasoning, become significantly more important.
Six Skills for the Conceptual Age
Note how the following six right-brain aptitudes that Pink has identified as being critical to professional and personal success in the Conceptual Age fit right in with any environment devoted to innovation:
- Design: Being an expert on function is no longer enough. People now want companies to offer us something that is beautifully designed, whimsical or emotionally engaging.
- Story: Flooded by information every day, we need story tellers who can help us make sense of it. Being able to form a compelling narrative is critical.
- Symphony: We also need people who can synthesize ideas from different realms and create something entirely new. This requires nonlinear thinking.
- Empathy: Logic is still important but much of the analytical work can now be done by computers. But computers don’t have the ability to empathize and thereby build relationships that will help drive projects and partnerships forward takes on equal importance as logic. People and organizations with this skill will thrive.
- Play: The heap of evidence that shows the value of play in both work and non-work environments just keeps growing. Surely in a workplace devoted to innovation play is especially important.
- Meaning: In a world where it is easy to accumulate things, Pink says the struggle for survival has been replaced with time to “pursue more significant desires, such as purpose, transcendence and spiritual fulfillment.” Taking this drive for meaning seriously in the workplace helps strengthen organizations.
Pink rounds out his book with numerous on-line and published sources for learning more about how to develop these skills.
