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Report from the Process of Innovation Conference

Report from the Process of Innovation Conference

| On 20, Aug 2007

Ellen Domb

I’m in Chicago IL USA this week at the conference organized by IQPC on the Process of Innovation.  I’ll be reporting progressively throughout the week on the highlights of the conference.  (If anyone is reading this in the Chicago area, we will be having an informal TRIZ meeting Tuesday, August 21, 6 pm at the restaurant at 600 N. Michigan Ave.)

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The first day of the program featured Anthony L. Carter, Sr. Business Director, Early Stage Accelerator, Motorola.  The class members were from telecommunications, computer systems, heavy equipment, oil industry, and the government office for innovation in South Africa.  

Motorola’s history of major innovations (one per decade since the 1930s car radio to the police and military communications to the current RAZR cell phones) was used as a template, and Anthony started with the baseball analogy—you need lots of singles as well as the once-per-decade homeruns to be an innovative organization.   The emphasis was that creativity is not enough—innovation is commercial innovation, and the primary metric is that people must be willing to pay for it.  

Anthony’s statement, “Combining existing things in a new way is innovation just as much as new things,” stimulated class discussion, as did his definition, “Invention is coming up with the idea and applying the idea as a solution to a problem.  It is usually closely aligned with Intellectual Property, and may or may not lead to innovation opportunities.”

A key theme is that innovation enhances margin, thereby fighting the overwhelming tendency of markets to commoditize over time.   Anthony used well-known examples such as Apple’s I-Pod and P&G’s cleaning products as well as Google’s basic search services and their expansion to many other information services.   His point that innovation applies very strongly to public benefit and not-for-profit organizations, which measure benefit differently from commercial businesses, was well received by the audience.   The class reacted very strongly to the Boston Consulting Group data on CEO’s view of the importance of innovation and what are the problems of getting a return from innovation.

We then explored major factors why innovation fails:

  • Actions taken to commercialize the innovation critically impacts the ultimate value created
  • Many innovations are forced toward large, most-demanding opportunities even when not appropriate
  • Impatience, including moving away from high-potential disruptive footholds to demanding,   complicated opportunities, and early technological lock-in, which makes it hard to adapt to market signals
  • Not spending enough time identifying customer
  • Company culture and values, including only large opportunities get prioritized, applying rigor, normal process, and discipline too early, and discouraging failure and experiment
  • Unrealistic Expectations,  leads to premature change of plans

A company must be proficient in all four capabilities in order to innovate repeatedly:

  • Market planning
  • Portfolio management
  • Platform management
  • Pipeline management

Class members appreciated the model, and shared their negative experiences with organizations that have neglected one or more of these competencies.  

The overall innovation process that formed the core of the day’s curriculum is “CMPIS” which is an acronym for the steps:

  1. Collect the idea—make it easy to put ideas in. Provide fast, personalized feedback.
  2. Mature ideas into business cases
  3. Pipeline Management—aligned to corporate strategic objectives, with clear measurable criteria, without a lot of complexity in the reporting process.  
  4. Implement-Fail fast, fail cheap
  5. Scale up winners

The Early Stage Accelerator group at Motorola cultivates new markets, new technologies, and new business models, and functions in many ways as in internal venture capital resource.   Anthony offered that as a contrast to the Early Stage Incubator model, which puts heavier investment into a smaller number of ideas, and needs resources to sustain the investments over several years.   ESA’s take 1-3 years; ESI’s take 3-8 years.   ESA’s create ROI much sooner, but also have more failures. 

The afternoon class focused on the difficult issues of the management of innovation, including reward systems, strategic linkages, measurement systems that are meaningful and useful (several class members contributed stories of measurements that were not useful for improving the system—measurements that are only good for writing reports that waste everyone’s time.)

Anthony shared a number of case studies with personal experiences in qualitative (interviews, context based) and quantitative (survey) customer research.   His stories were very good learning points on the dramatic differences between what customers like and what they will pay for, and the difference between what they think you want to hear and what they really want to say.  

He reported on a conference from April 2007 by Peer Insight, which is a consulting company that does research by assembling teams of mutually respecting, non-competing companies.   The participants have the same complaints we have seen in the discussion forum of Real Innovation and The TRIZ Journal:   it takes too long, management doesn’t support it, more comes from outside the company (but things from outside are hard to control.)   Their results supported those of the O’Reilly & Tushman  study that showed that the “Ambidextrous” organization (ones that can do both control and freedom) are 9 times more likely to succeed in NPD than those that adhere strictly to any one model. 

The concluding class module emphasized the global nature of innovation, not just for large companies, and the reassurance that the large numbers of issues, elements, and considerations discussed all day really are all part of the innovation environment, and that successful innovative companies do indeed manage to do all of them.    The TRIZ note that I would add is that they do all of them, but separated in time, in space, or by condition, in order to make the process happen within the constrained resources of our companies.