A strong take on Innovation (part 2)
For part1, click here.
How to create a culture of innovation
Crowdsource innovation: Organizations can reach out to people internally and outside to ask smart questions and get ideas. Heard of Enable Makethon 2.0? They call for crowdsourcing of ideas. The call “...invites persons with disabilities, engineers, designers, scientists, innovators, manufacturers, investors, entrepreneurs and humanitarians, to join the Enable Makeathon 2 movement to develop appropriate solutions for challenges of Accessibility and Employability faced by persons with disabilities at the bottom of the pyramid”. NASA opened its challenges to outside professionals for help.
Do not call it innovation: Nick de May in his blog 7 top-notch books on Innovation, states that there are at least 70,000 books on innovation. Try the following. Google search the word “innovation”. It results in 3.4billions hits in 0.57 seconds. The word innovation has become a cliché and reminds people of past failures in innovation experiments. It also negatively influences the participants about the true intent of managers. Then, what should you call it? How about strategy?
Do more experiments: Do more experiments to quickly check the response of customers. And if the testing is done online, it is easier and quicker. Technology companies frequently use A/B testing. If you have an idea and want to know if your customers would like it, show it to a selected few and check the impact on their usage. If you want to experiment with multiple permutations and combinations, expand the A/B testing to A/B/C… testing. Almost every company nowadays uses A/B testing. Facebook tests its new landing page templates using A/B testing. Humana, a healthcare company tests its website banners using A/B. Here is a funny conundrum. A/B testing does not solve decision making all the time. In an interesting report in WSJ about an episode of Netflix’s A/B testing whether to include Jane Fonda’s image in promotional material, the test showed that viewers did not like her image but Netflix went ahead with the image due to contractual and emotional reasons. It is worth repeating the quote of Linus Pauling “to get a great idea, get a lot of ideas and throw away the bad ones”. A/B Testing helps with this.
Check who is unhappy: Innovation happens when the organization is restless (to provide more value). Innovation happens when you are ready to cannibalize your products. Innovation happens when you watch a ‘weaker’ competition working on a ‘stupid’ idea. Innovation happens because of unhappy customers and not because of new technology. In his book Unlocking the Customer Value Chain: How Decoupling Drives Consumer Disruption, Thales Teixeira describes Incumbent-disruptor pairs to highlight that disruptors are not going after the same markets or the same customers as the incumbents but after those capabilities that the incumbent missed or those customers that are unhappy.
Look at ‘adjacencies’ or synergies for challenges: Airbnb has been offering accommodation services for a long time but now offers travel planning tools which are right adjacent to the core offering. Suggesting how to have “Growth Outside The Core” in their HBR paper, Chris Zook and James Allen in 2003 explain how companies can look for additional revenue sources by looking at ‘adjacent’ areas of their core offering. P&G’s Crest toothpaste brand expanded into adjacent teeth-whitening and brushing (resulting in WhiteStrips and SpinBrush) to get market share and revenues.
Collect data, use AI and let the teams easily play with the data.
Design: Heard of Design Thinking? Use it.
Org structure & policies: Apple has open offices for team members. Not many employees have private offices. Jeff Bezos had no bigger office than his admin when they started. Intel’s Andy Grove famously occupied an open-style office similar to those of any other employee.
Dress style: The standard button-down shirts and suits, which was de facto dress style for IBM employees 20 years, were thought to show the class and status of the employees and their organization. Silicon Valley, which is considered the hub for innovation and birthplace of garage-born super successful companies, has insisted on informal dress styles. T-shirts & shorts are a common sight and tie & suit are rarely a sight in the bay area.
To alter your thinking, change the way you see: Velcro was invented when a swiss engineer who went on a hike in mountains came back with burrs sticking to his pants and saw them differently. Robert Taylor saw (hard) soap differently and invented Softsoap.
Hire great product managers: A great product manager sees products/solutions differently. She understands what distinguishes a product, even if that product is in an unrelated industry. For example, a Product Manager in a tech world would benefit by studying products like Cars, Lipstick, Pesticides, etc. Next time when you interview a candidate, ask him/her to narrate distinguishing features of a daily used product like TV, Car, soap, couch, toaster oven and check if (s)he could apply any of those features in your product.
Encourage employees to wear T-shirts to work: Know what a Butterfly effect is? T-shirts, which signify informal work culture, encourage people to speak up, talk informally, form informal groups around invisible water-coolers (heard of Slack?), talk about new and radical ideas. Note: T-shirts alone will not, but it is a good starting point. Smart and mature managers, open culture, tolerance towards failures & risks, etc. are some of the essential features for creativity, that trickle-down when you create informal culture.
Show me the rejected ideas: Executives who review great ideas after they have been reviewed and percolated up in the chain of the organization structure may get to see what ideas were felt to be good ideas. They are essentially sanitized for executive management. It may be a good idea to check the rejected ideas too. Henry Ford, though would get to review ideas that are presented to the Board (after being reviewed and shortlisted by groups in the organization hierarchy) but also ask for the list of rejected ideas.
Does Diversity help? Add diversity of gender, race, language, geography, physical-ability, talent, specialization, etc. in the teams. The more diverse the teams are, the higher is the creativity. “Creativity presupposes a community of people who share ways of thinking and acting, who learn from each other and imitate each other’s actions,” says Jane Henry in the paper Creative Management and Development.
Mindfulness: Watch your surroundings carefully for ideas. To take creativity to the next level one has to detect the true impact of an idea. And also detect rituals or superstitions observed unwittingly in organizations. The case of cattle-guards is worth mentioning. Cattle ranchers, to restrain cattle from wandering off, dug a ditch and laid metallic pipes as cattle-guards. Cattle would not cross but humans and vehicles can easily move. But once the cattle are accustomed to cattle-guards, ranchers removed the guards and painted stripes on the ground. Cattle did not cross them.
Innovation through blunders: A keen eye can find an innovative idea in what is commonly construed as a mishap or a mismanaged idea. P&G’s famous Ivory brand soap was a super successful floating soap that was invented by accident. A worker left the soap mixture liquid in a mix for a longer period than planned (because he forgot and took a lunch break leaving the mixture in the mixer). After he returned he continued to make the soap that resulted in this extremely lightweight soap, with bubbles trapped inside, making it float in a water tub. Penicillin was an accident. The inventor of Post-Its, Spencer Silver in 3M, was working on a super-strong adhesive and instead arrived at an adhesive that sticks but can be easily removed. Sometimes blunders could help innovate albeit with some additional cost. Minoxidil and Viagra were accidental innovations. They were initially tested for blood pressure. But during field tests, they found that they had side effects that were more useful and hence were re-marketed for the new use.
Too early in time: Sometimes an idea though innovative may not succeed. Put that on a back burner and bring it back later. Keep a list of old ideas and bring them back for discussion. Or collect old ideas from across the organization and share with everyone. Today we cannot conceive of a world without mobile phones but when Motorola announced their first mobile phones in the 1980s called the Brick costing around $4k. it was a huge failure. But the idea came back and now we have 14 billion mobile phones, according to Statista (14 billion phones for 7 billion people. Go figure).
Listen to your customers, but not always: Henry Ford said if he had asked customers, they would have asked for a better horse. Steve Jobs did not want a USB port in an iPad even when his executives wanted one and the competing products all had one. They opined “... a USB port will allow customers to extend the capability of iPad, say one could add a new display screen or external storage or even an external battery..”. Jobs did not want it and people thought that the product would fail. Bob Metcalf while at 3Com faced a barrage of requests from his customers and his sales team for 3Com to invest in a networking card for Multibus compatible computers. He instead invested in EtherLink Cards. Larry Miller wanted to improve his daughter's fitness without impacting her knees. He videotaped her daughter running and watched the movement of legs trace an elliptical path. He designed a workout machine that would help with his daughter's workout. The world’s first Elliptical trainer was born, that was eventually sold to the Seattle based fitness machine company, PreCor. Ever observed how kids’ toothbrushes look? They are thicker and squishy. This is so because of the fisting style of kids and also squishy grip makes it fun to hold (hence kids would hold it for a longer time and hence brush for a longer time). Give them what they want but make it more fun.
Culture of the group: Creativity would help design different products for different cultures. The same product would evoke the opposite emotions between the two cultures. A noisy vacuum cleaner in the US comes to signify its power whereas in Japan consumers want a quieter vacuum cleaner and even a less powerful one because Japanese women who vacuum clean at night do not want the neighbors to be disturbed. Also, the walls in Japanese houses are thinner and the neighbors are just a couple of inches away. Bigger cars are better in the USA but smaller cars are preferred in Europe. Betty Crocker's ready-to-make Cake mixes were initially a failure in the 1950s. When General Mills wanted to find out the reason, they asked a group of researchers. The researchers found out that women did not use the cake-mixes out of guilt. They felt that they are doing injustice to making cakes. The ready-to-make cake-mixes sales took-off after the company made it a little more difficult to make a cake by asking women to add an egg.
Do the exact opposite: Enterprises sell products to make money. No one would imagine that by giving away for free, you can make money. An example, in this case, is YouTube. Open Source movement went against the very nature of the software business. You develop a software solution and then sell the license to use it, never sell the source code, much less give it away. There are new businesses that emerged in the open-source movement. Linux, Ubuntu, BSD, Apache, Firefox, Hadoop, Drupal, Java, etc. are some of the few open-source products that made a lot of money.
Ideas from other industries: IDEO suggested using a “heart valve” from the Health Care industry to the Cycling industry. The heart has a valve that restricts the flow of blood in one direction only. This idea was used in water bottles that prevent water from spilling but flows when the bottle is squeezed. This helps cyclists carry a spill-proof bottle and also could be used with one hand. Mark and Spencer used the idea of a spray-gun to lay cheese in sandwiches which was copied from screen printing of silk clothes.
How to stifle innovation
The way good habits help innovation to flourish, certain unhealthy habits stifle it. Unimpressive managers, managers with less empathy, sacred cows, resting on past successful ideas/products/laurels, over skepticism, lack of patience for failures, hiring yes-sayers, setting up an Innovation department, over-busy employees, unlimited resources (like unlimited time, people, money, etc.), too many experts, are some of the major stumbling blocks. Though some of them listed here are intuitive, some are counter-intuitive. Unlimited resources bring complacency and diminish innovation. Malcolm Gladwell dedicated an entire book, David and Goliath, to this topic of what happens when ordinary people/organizations face giants. Giants are those who are powerful, strong and have a lot of resources, but he says, “the same qualities that appear to give them strength are often the sources of great weakness.”
Epilogue
Many of the above ideas to innovation are quite intuitive and common sense. Then why are people and enterprises not innovative? How only some of the organizations are more innovative than others? Why do innovative organizations eventually lose their innovation edge and move into oblivion? Why the zeal for innovation is not sustained for a longer time? Why do some companies that have all the capabilities and resources to be innovative are not innovative and why those that are resource-constrained seem to zoom into the future using innovation?
No single reason exists for the success of innovation in an organization. No single theory or hypothesis has been proposed. I do not believe such a single cause exists. The Google-school-of-thought believes in the decentralization of decision making for innovation whereas the Apple-school-of-thought believes in centralization. Steve Jobs famously had promised unlimited resources to Apple employees for strategic products but many other pieces of evidence and research show that resource constraints enhance innovation. Yin and Yang seem to be the possibility.
Call for action
If innovation is good, how do I kick start it in my group? If you are convinced that innovation will help in your major key metrics, what would be the best starting point? Though it is tempting to suggest a silver bullet, one of the many ideas that seem to make sense is suggested by Sydney Finkelstein in her HBR publication titled A Brief Exercise to Spur Innovation on Your Team. Sydney suggests to form a team of passionate individuals and do the following exercise: Take a pen and paper and draw three columns in the paper. In the first column, list activities that you have always done in the org. that are key to the success of the organization. In the second column, list the market shifts, changing technologies or external forces that may disrupt the operational status quo. In the third column write a list of actions that you would do to address the disruptions. Repeat this exercise and collect a lot of ideas.
Remember what Linus Pauling said, “the best way to have a good idea is to have a lot of ideas”.
References
If links in this blog are not visible/broken, here is another way of accessing (some of) them.
1https://hbr.org/2020/02/lessons-from-teslas-approach-to-innovation
2https://www.weforum.org/reports/davos-2020
3https://www.nytimes.com/1993/02/13/business/for-an-un-valentine-dead-black-roses.html
4https://en.wikipedia.org/wiki/Tony_Hsieh
8https://www.mac-history.net/apple-history-2/apple-lisa/2007-10-12/apple-lisa
10https://www.cbinsights.com/research/corporate-innovation-product-fails/
11https://www.jimcollins.com/article_topics/articles/building-companies.html
12https://www.fastcompany.com/50992/was-built-last-built-last
13https://www.fastcompany.com/company/3m
15https://www.jimcollins.com/article_topics/articles/building-companies.html
16https://www.jimcollins.com/concepts/clock-building-not-time-telling.html
17https://www.amazon.com/dp/0062856626?tag=imprintweb-20
19https://invention.si.edu/thomas-edisons-inventive-life
20https://hbr.org/webinar/2020/02/breaking-down-barriers-to-innovation
21https://en.wikipedia.org/wiki/Charles_Darwin
22https://en.wikipedia.org/wiki/Power_Macintosh_8600
27https://hbr.org/2019/11/what-companies-that-are-good-at-innovation-get-right
28https://www.cnet.com/news/aol-may-offer-unlimited-net-access/
29https://www.cnet.com/news/aol-u-k-plans-flat-rate-net-access/
30https://www.cnet.com/news/aol-u-k-plans-flat-rate-net-access/
31https://www.levyinnovation.com/a-problem-well-stated-is-half-solved/
33https://news.bbc.co.uk/2/hi/africa/8166196.stm
34https://www.thebetterindia.com/58509/reuse-plastic-bottles-reduce-pollution-waste/
36https://www.personalcreations.com/blog/50-new-uses-for-old-things
37https://www.pinterest.com/africacraftrust/recycling-and-upcycling-africa-craft-trust/
38https://hbr.org/2009/12/the-innovators-dna
40https://www.disabilityinnovation.com/practice/enable-makeathon-2-0
41https://journals.sagepub.com/doi/full/10.1177/0001839217747876
48https://www.swissinfo.ch/eng/how-a-swiss-invention-hooked-the-world/5653568
52https://gizmodo.com/how-floating-soap-was-invented-1693781360
53https://www.nobelprize.org/prizes/medicine/1945/fleming/biographical/
54https://www.post-it.com/3M/en_US/post-it/contact-us/about-us/
55https://www.dhirubhai.net/pulse/my-experiments-innovation-s-k-reddy/
56https://en.wikipedia.org/wiki/Motorola_DynaTAC
60https://hbr.org/2019/07/a-brief-exercise-to-spur-innovation-on-your-team
Data | Cloud | AI ML | Edge Compute
4 年Nice one
MTS 3 - Software Engineer at Hughes Network Systems
4 年Great article sir (especially part 1- cross pollination of ideas and vapor lock). From part 2, I find the following line hard to comprehend -"Innovation happens when you watch a ‘weaker’ competition working on a ‘stupid’ idea". Could you please provide an explanation or example for the same?
Engineering | Investor | Board Member
4 年Very insightful. Thanks for writing this.