Monday, January 30, 2012

Highlights of Lessons Learned

Innovations require parenting, more than managing.

Perhaps the biggest “aha” of last year was one that left us mumbling to ourselves, “Why didn't I see this before?” 

Though our letterhead says “innovation management”—largely a legacy from 20 years ago when I was a part of the Innovation Management group at Kimberly-Clark Corporation, I have become convinced that parenting is a better word than managing when it comes to innovations. While effective parenting involves good management skills and efforts, parenting captures the essential developmental character of innovation and innovating.  Just as every child is unique, so every innovation is unique. What works in parenting one child might not for their brother or sister. However, principles of parenting learned with one child can certainly help parents with the next child. So too, with innovators and their innovations.  And just as “it takes a village to raise a child,” so too, it takes a whole host of participants, particularly in informal and implicit networks that straddle the formal organizational boundaries of our companies, to successfully develop and commercialize an innovation.

After being a student of innovation management, particularly in established companies, for almost 25 years, we were struck with the power and appropriateness of the word “parenting.”

Play may be what is missing in our innovation efforts.

Our fascination with, and early applications of, the work of Dr. Stuart Brown, has led us to believe that the early entrepreneurial roots of most successful companies were significantly influenced by a healthy dose of play—whether the playfulness of an original inventor, or the playfulness of a subsequent entrepreneur, or both. What so easily gets lost when a company 'grows up' and becomes responsible for consistent performance to its shareholders, is that early entrepreneurial vocation that was infused with play. [As Dr. Brown reminds us, the opposite of play is not work, nor performance; it is depression: emotional and financial.] Even though play has a public-relations problem in our productivity-driven business culture, this past year has brought be to a growing belief that play may be just what is chronically missing in our innovation efforts. 

Lester and Piori (in their book, Innovation, the Missing Dimension) allude to this when they suggest that what companies are not doing enough of is setting up protected spaces within which to learn, experiment and discover what their competition has not yet discovered. Might we not call these playgrounds within which our nascent innovations can themselves play? Clif Bar & Company calls these playgrounds “discovery channels,” and is starting to take seriously the power and importance of play in their innovation efforts.

Collaboration may be as important as competition for our innovation efforts.

If you haven't read it yet, Henry Chesbrough's Open Innovation should be near or at the top of your reading list. Not only does it explode the myth of our “funnel model” for innovation management, it reminds us all of the tyranny of the core business revenue model. What Chesbrough articulated so well, it what we have been seeing in so many of our clients. Collaboration with other companies is no longer an option. It is a necessity, even though many of us don't think we know how to do it very well, given competitive and proprietary interests and habits.

This article was originally published in Innovating Perspectives in January 2006. For this and other back issues of our newsletter, please visit our website at or call (415) 387-1270.   

Tuesday, January 24, 2012

Parenting Innovations: Some Fundamentals

Legendary amateur golfer Bobby Jones reputedly said if your average score is over 90, you are probably not practicing the fundamentals enough. If your average score is under 80, you are probably neglecting your family, work or both! The lessons learned last year were many and varied, and took us back to the importance and value of practicing the fundamentals of innovation and its management. 

Last year we learned that innovations require parenting more than simply managing; that collaboration may be as important to innovation as competition; and that sufficient play is necessary for healthy development—for innovation and innovator alike.

These lessons were no less valid this year. But as we reflect upon what turned out to be a very full and busy year, we are reminded how crucial the fundamentals still are. Any workable set of fundamentals needs to be short as well as basic to qualify as fundamentals, without oversimplifying. In golf, a common list of fundamentals is alignment, balance and posture. In the challenges of parenting innovation we offer this short list: context, causal connections and adaptation. 

Context: Any innovation by definition is both new and valuable, and as our associate Jim O’Shaughnessy reminds us: “all value is contextual.” For example, water in the Phoenix, Arizona, is valued differently than water in Traverse City, Michigan. In both locations it is H2O, but because the contexts are so different, water is more precious in Phoenix than Traverse City. The same can be said for novelty. Novelty is also contextual.  “Newness,” as observed by Mihaly Csikszentmihalyi, is defined socially. What is “wow” new for one group may be considered old hat by another. For example, the iPod was made from well known technologies—old hat to some, but new and “wow” to others, especially in context of iTunes and 99¢ songs. 

If innovation is so innately contextual, then shouldn’t we be paying close attention to the context as well as the text—the conditions and situation that provide the sitz en Lieben (or situation in life) within which the innovation has meaning and value, as well as the innovation itself?

Peter Drucker recognized this truth about context in his book Innovation and Entrepreneurship where he boldly named seven sources of innovation and listed them in order of reliability. The most predictable ones rely on contextual understanding. This more than a coincidence. Drucker’s top two sources are (1) surprise failure or unexpected success and (2) incongruities between the way things are and the way things should be.

Using context plays out even in addressing the classic “hand-off” challenge as well. Much of the tacit (i.e., contextual) knowledge required for a successful hand-off of an innovation from development to launch resides with operating personnel—those currently involved in making the operating portions of the core business successful. When a transfer or hand-off is ready to happen, some of these people need to be refocused for varying periods of time. 

Some companies develop and use a template that enables a phase in/out of these people so as to forecast the temporary shift of their focus and responsibilities and minimize the negative impact on the core operations. One of the most penetrating assignments this year engaged us to help a client to develop just such a  template. Geoffrey Moore, in his book Dealing with Darwin, points out that these people—the ones with appropriate contextual knowledge—can and should be counter-rotated within organizations for more sustainable innovation streams.

Causal connections: Innovations emerge and develop because of the connections between seemingly unrelated people, ideas and know-how. When innovators see and understand the causality behind the connection, innovations can be born. 

One of these causal connections is the people-to-people connection. Relationships are at the heart of any entrepreneurial activity. The misleading caricature of the lone entrepreneur stems in part from the Horatio Alger stories of success and individualism. But if you look more closely, you will see a relationship, most often between two people, sometimes three, from which significant enterprises were born.

Hewlett-Packard started with Bill and Dave, even before they had their first product in mind. Apple Inc.’s Steve Jobs and Steve Wozniak. Even in renewals of great companies like Disney’s Michael Eisner and Frank Wells. Nothing happens except out of relationships. This is not only true for the entrepreneurial origins of companies. It is true for the later intrapreneurial efforts as well, as in relationships between mavericks or champions and their sponsors and mentors (or “midwives”).

Causal connections are not limited to the interpersonal. They occur as mental connections that well-prepared minds, conducting both actual and thought experiments together, can create to form new knowledge, find new applications of old knowledge and both invent and discover.

We see inventors making connections all the time in the innovation workshops we facilitate. However, it is the causal connections that make the biggest contribution. What differentiates the causal connection from the ordinary connection is the knowledge—often science-based knowledge—of the connection-makers. Often what looks like serendipity results from these causal connections,  reflecting Louis Pasteur’s observation that chance favors the prepared mind.

Adaptation: When a word makes it to Madison Avenue, you and I know that it is probably time to become a bit wary about how it is being used. This has certainly happened, disappointingly, with the word “innovation.” Sometimes it is difficult to know how it is being used. Sometimes the word is just plain abused—a reminder that our language itself is constantly morphing—mutations producing variety, some of which are selected (hopefully naturally), before being retained and hopefully contributing to something we could call evolutionary progress. 

So as the word “innovation” is starting to morph with all the twists and turns of the media and PR campaigns, adaptation may be a more trustworthy substitute, at least for the time being. From Clif Bar’s Gary Erickson to the former chairman of Toyota, the mantra of act, pay attention to what happens, and then adapt, seems to sum up what is at the heart of innovation.

While we may have left off a fundamental or two (and we welcome your thoughts on the fundamentals), this might be a place to start—to get aligned with the “needed” new, stay in balance and use our posture to sustain those innovations that work®.

This article was originally published in Innovating Perspectives in January 2007. For this and other back issues of our newsletter, please visit our website at or call (415) 387-1270.   

Tuesday, January 17, 2012

An Old Saw on Innovation

Here is a story about a hard working but inexperienced do-it-yourself-er working on a home improvement project. It may be a parable for our corporate innovation efforts?
One day, this DIY guy went to the local hardware store to buy a saw for a tree-cutting project. The hardware store clerk showed him various makes and models before finally presenting him the premier chainsaw. “This one will cut four cords a day, guaranteed.” This was enough to convince this hard worker to buy it and take it home, full of hope and expectation.  The next day the proud owner of the new chainsaw ate a hearty breakfast before tackling his trees. He worked very hard until late in the afternoon, then he took a break and  measured how  many cords he had cut. To his great disappointment he found that he had only cut one cord. He thought maybe there was something wrong with the saw.   The following day, determined to achieve the four cord guarantee, he got up earlier and worked later; and when he had finished for the day, he found that he had only cut two cords of wood, still a full two cords shy of what the clerk had promised him. So the third day, he got up even earlier and worked non-stop all day until it was too dark to see. But still, when he measured his output for the day he had cut only three cords.    Now he was certain there was something wrong  with  the  saw.  The next  day,  he took it back to the hardware store, put it down on the counter in front of the same clerk who had sold it to him and complained, “There is something wrong with this chain saw. I worked from early morning to late at night and all I could get was three cords! You guaranteed me four.”  The clerk carefully examined the chainsaw. The blades looked sharp. The chain slid through the bar effortlessly. He checked for oil. Everything seemed to be in order. “Well,” the clerk said, “let's go outside and start her up.” The two went outside and after just one pull of the starter cord the chainsaw started with a roar. The diligent do-it-yourself-er jumped back startled and exclaimed, “What's that noise?”
•    •    •
Are we using our skills and knowledge in the best way we can? This is a perennial question that follows stewards of innovation management systems. Are we fully using the competencies that we have, or are we cutting wood the old fashion way, even with a chainsaw in our hands?  Answering this question in the context of operational routines—where the skills, knowledge and experience resident in our organization are already aligned with fairly well defined tasks—is one thing.
Answering this question in the context of innovation efforts, where neither the context is known nor are routines established, is another thing altogether.    How we define a person's skills, knowledge and experience is determined in part by the times and places wherein they have applied those skills and knowledge in the past. Dorothy Leonard was getting at this innovation management dilemma when she observed how core competencies can become core rigidities when specialization becomes captive to what is relevant only to established routines.     Applying the skills, knowledge and experience developed in one operational context to the emergent realities of an innovation context requires a healthy dose of adaptation and improvisation. It is this willingness, confidence, and faith to improvise and be flexible that ends up being the more precious resource. And this is a resource that may be more responsive to invitation, experimentation, and playfulness (innovation efforts) than to conservation, preservation, and control (operations).    Asking the best and brightest in our organizations to take what they are good at and adapt and improvise may indeed be the best way to avoid cutting the wood of opportunities the old fashion way and innovate our way into the future, instead of simply survive.   _________________  This article was originally published in Innovating Perspectives in August 2008. For this and other back issues of our newsletter, please visit our website at or call (415) 387-1270.   

Tuesday, January 10, 2012

20 years of innovations that work

For the past 20 years, we have facilitated hundreds of collaborative invention workshops and dozens of opportunity foresight cycles and market discovery efforts for companies in North America, Europe, Asia and Australia in a variety of industry sectors. Increasingly we are being invited to coach innovators and their executive sponsors. And lately, we are being asked to provide subject matter expertise where the topic is innovating in the context of successful companies.

We count the results of our work in the relationships we have with our clients, some of which stretch even beyond our 20 years in business. As in previous years, 80% of our business comes from clients with whom we have worked for over five years.

In all these engagements we have especially enjoyed our close and ongoing associations with so many innovation practitioners, who we see as fellow students of innovation learning what the crucibles of innovating can teach us. These associations have lead not only to the publication of the book, The Maverick Way: Profiting from the Power of the Corporate Misfit in 2000, and the article Innovation Midwives in Research-Technology Management in January 2005, but also built a robust body of knowledge on how to manage and parent innovations in corporations. We now find ourselves disseminating this know-how to groups of senior technologists in our client companies who are well positioned to have a catalyzing effect on others within their organizations.

Over the past five years we have witnessed a flood of books and articles on innovation and innovation management, not to mention the entrance of many consulting firms and business school sub-specialty programs focused on innovation. The flood tide has not ebbed, even amidst this Great Recession. Like a persistent flood, the shallow low-lying areas that used to be visible get washed out. What now appear as broader channels for innovating, actually end up being even more treacherous to those first-time innovators who navigate its challenges. Many of the charted shoals have become covered over with thin layers of processes and techniques. Many innovators have unfortunately run aground, while others have been left high and dry.  

As a result, we thought the occasion of this new year presents a chance to remind many of you what we believe are some enduring principles and practices for managing innovation. These lessons have stood the test of time for innovators, their sponsors and managers.

Content precedes process, just as form follows function. 

You would think this would go without saying, but there is a torrent of process techniques being pitched that many mistakenly substitute for clear, coherent direction. Many executives say, “we need more innovation,” yet few do their homework to confidently direct their innovators to where innovations are needed and why. When leaders do this homework, their innovator networks respond vigorously and quickly, and, most importantly, in the right territories.

Nothing happens except out of relationships. 

The white knight syndrome and the myth of the lone entrepreneur persist, but they belie the facts. If you look closely at companies with historically high rates of innovation, you will find not a lone individual but a vibrant, enduring relationship. Bill Hewlett and David Packard. Walt and Roy Disney. Paul Allen and Bill Gates. Steve Jobs and Steve Wozniak. It seems extrinsic compensation, reward and recognition practices are hard pressed to compete with the undeniable reality that the human relationship is the intrinsic heart of the innovation engine. Think of the music that jazz musicians make when they get together to jam. Innovations at first are not marches but melodies.

Success is the enemy of innovation.

Innovating is disruptive by definition, especially to the incumbent who is inclined to defend his position. Companies that underestimate the resistance to innovation within their own organizations tend to be chronically disappointed with the returns on their innovation investments. Without sufficient and appropriate insulation, innovation efforts will remain unnecessarily vulnerable to “sibling rivalry” from existing and cash generating operations in the core business. 

“Innovation is learning applied to creating value.” 

This was how Al Ward (an expert in Toyota’s development system) defined innovation. Innovating is a risky, no-guarantee kind of activity. There is a better than 50-50 chance the innovation-in-development will not prove to be a commercial success. However, if knowledge is created in the process—knowledge that can and will be used in the next iteration—success can be viewed as a succession of adaptations, rather than a one-time embodiment. An older expression may be “if at first you don’t succeed, try, try again.” Providing value to the end user trumps newness if you are looking for competitive differentiation, particularly when the vision of the innovation’s value allows us the patience for growth and sustains our efforts over multiple tries.

Play is the tuition for adaptability. 

The science of play teaches us that our species' ability to adapt and evolve is a direct result of the confidence we learn and gain in earlier play experiences. Innovation begins at the boundaries between order and chaos. Without order nothing can exist. Without chaos nothing can evolve. The ability of an organization to convert the “noise” at these boundaries into meaningful “signals”—even into innovations—derives from its freedom and ability to play. Simulations, thought and field experiments, scenario planning and messing around in the lab all contribute to the innovation’s survival and success.

When our organizations become too lean, they can become too mean not only in temperament, but also in average performance. When asked about innovation at Apple, Steve Jobs replied, “We don’t talk about innovation. We just talk about making insanely great products.” By definition, innovations are not average, nor even close to the mean.

Certainly other principles and practices of innovation may be of equal importance, depending upon the particular competitive, technological or organizational conditions  that confront the innovator. A few of these principles include:

•     Paying attention to subtle surprises in the market or the development lab;

•     Getting your innovation into the market with sufficient alertness to catch the serendipity;

•     Giving yourself permission to fail so that real learning can occur; and

•     Managing like a loving parent, neither too permissive nor dogmatic about early performance.

Instead of people looking for a formula for how-to do innovation, we need more innovators, sponsors and leaders who believe in the inspirations that can come from necessity. After all, as the saying goes, necessity is the mother of invention.     

This article was originally published in Innovating Perspectives in January 2010. For this and other back issues of our newsletter, please visit our website at or call (415) 387-1270.


Tuesday, January 3, 2012

Some key lessons we have learned

By Jane Gannon, Associate

The occasion of our 20th anniversary offered us a chance to review our past annual reports and their record of the lessons we have learned with you over the years. Client assignments have been our primary instructors throughout the past two decades, and these experiences confirm that innovating is demanding and not for the faint of heart.

We thought we would share some of the key lessons we have learned as a result of our collaborations with you:

•    Success is the enemy of innovation.

•    Knowledge-creation sustains innovation systems. “Innovation is learning applied to creating value.”

•    An innovation develops best in the field, even more than in the lab.

•    Even within companies serious about innovation, persistent and pesky allergies to “the new” remain.

•    Nothing happens except out of relationships. Trust is the currency of relationships.

•    Play is the tuition required to grow adaptive capability. 

•    Successful entrepreneurial action is as much about having the courage to do the most with what you have as it is about being more creative than the next guy.

•    Managing interpersonal relationships (soft systems) can often be the hardest part of managing for innovation.

•    A company’s inventive intellectual capital can be aimed to prospectively invent in areas that both exploit the expertise of a company and address anticipated paths of development.

•    Combining insights discovered from external investigations with insights from internal lessons learned can be a powerful approach for transforming intelligence into innovation.

•    Story-making and storytelling are essential to perceiving both threats and opportunities on the horizon.

•    Content precedes process, just as form follows function.  Innovating is a process driven by the innovator's clarity and conviction in an entrepreneurial opportunity.

•     Pay attention to subtle surprises in the market, the development lab, and in the market of your existing products or your competitors products. These are often the most reliable signposts and sources of where to innovate next.

•    Leaving room for experimentation in your strategic plan acknowledges the potential in the unanticipated and reflects an appropriate humility regarding the inescapable uncertainties of the future.

•    Role definition, clarification and improvisation can reduce chaos that comes with change-induced uncertainty.

•    Success in overcoming the not-invented-here syndrome comes in part from innovators ability to step back and share both the credit and the authorship.

•     Give yourself permission to fail so that real learning can occur.

•     Manage like a (tough) loving parent, neither too permissive nor dogmatic about early performance.

•     Instead of people looking for a formula for how-to do innovation, we need innovators who are inspired by necessity.

After all, as the old saying goes, necessity is the mother of invention.           

This article was originally published in Innovating Perspectives in July 2010. For this and other back issues of our newsletter, please visit our website at or call (415) 387-1270.