The Discipline of Innovation. Myths of innovation excellence Innovation is driven by creativity and...
-
Upload
isabel-walton -
Category
Documents
-
view
217 -
download
1
Transcript of The Discipline of Innovation. Myths of innovation excellence Innovation is driven by creativity and...
The Discipline of Innovation
Myths of innovation excellence
• Innovation is driven by creativity and sparks of genius• Act like a start-up• Innovation has to let a thousand flowers bloom• Game-changing programs have to separated from the
core business• Culture has to change
2Copyright 2013 New Markets Advisors
Truths are more subtle
• Innovation is driven by creativity and sparks of genius
• Innovation stems from being customer-centric, eager to experiment, and rigorous. These are capabilities that can exist throughout the organization
• Act like a Venture Capitalist, think carefully about how to balance the innovation portfolio, embrace fast failure
• The project funnel’s shape totally depends on organizational and strategic factors
• Act like a start-up
• Innovation has to let a thousand flowers bloom
• Game-changing programs have to separated from the core business
• Culture has to change
• Separation and integration must be balanced, new ventures may eventually “graduate”
• Culture is a lagging variable, not a leading one
Myths Truths
3Copyright 2013 New Markets Advisors
Four archetypes of innovation
Marketplace of Ideas
Visionary Leader
Innovation through Rigor
Collaboration-based Innovation
• Broad numbers of employees have innovation goals
• Extensive use of online collaboration tools
• Industry permits fast experiments in silos
• Industry has long lead-times for new offerings, requires cohesive vision of the future across functional silos
• Planning and governance structures may be relatively informal
• Structured approach to innovation used cross-functionally
• Approach tied to processes, governance, structure, training, and metrics
• Organization excels at commercializing innovations created by others
• Strong business development function
• Organization adept at rapidly trialing new offerings
Source: Wunker and Pohle, “Built for Innovation” Forbes, 2007
4Copyright 2013 New Markets Advisors
Responses by systematic innovation firms
• Pet projects that interested only a few visionaries, e.g. concept “pod” vehicles
• Herculean efforts that became disconnected from commercial realities, e.g. EV1
• Disconnected islands of innovation in a sea of status quo, e.g. NUMMI factory achieving record quality since the 1980s
• No cohesive strategy, governance, or accountability
Very Common, and Unlikely to Succeed
5
• Clear process for handling new ideas and new ventures, led by CTO and CEO
• Portfolio plan for how many ventures are sought, of what size and commitment level
• Specific strategic priorities, e.g. materials science applications in electric vehicle powertrains
• Active partnerships to bring novel offerings to market fast
Atypical, but Poised for Success
Copyright 2013 New Markets Advisors
Root causes of failure and success
Failure Factors
• Unclear purpose• Capture by pet projects• Designed to satisfy only the
company’s biggest, most profitable customers (today)
• Overly influenced by what the industry has been, and not what customers need the industry to be
• Projects move into “valley of death” after inception but before broad commercialization
• Too much money thrown at efforts, too quickly
Success Factors
• Competitive strategy guides the process
• Focused ideation around priority themes
• Development and commercialization processes
• Attention paid to HR – staffing, incentives, etc.
• Governance balances independence with constituency-building
• Metrics are broad enough to capture the many facets of innovation, but narrow enough to be manageable
• Bias toward action – get moving quickly
6Copyright 2013 New Markets Advisors
Factors that impact program design
• Will projects be disruptive or sustaining to the core business?
• Will most innovations come from inside the organization or from the outside?
• How differently can this new process act from business as usual without triggering “corporate antibodies”?
• How much ability is there to experiment and iterate with in-market tests?
• How tightly should efforts be tied to existing functions and business units?
7Copyright 2013 New Markets Advisors
Programs may eventually become multi-threadedProcter & Gamble example
• Dedicated home for new ventures requiring little integration with the core business
• Example – Mr. Clean Car Wash
8
• Facilitation for dedicated brand teams delving into a defined strategic area
• Example – SWASH fabric refresher for Not Quite Dirty clothes
• Open door for potential partners, as well as tight collaboration with small network of suppliers and retailers
• Example – Crest Whitestrips, leveraging trash bag technology from Clorox
• Mandates and methodologies for individual product areas, along with trainers, facilitators, idea-sharing, competitions, and awards
• Example – Head & Shoulders scalp examinations at retailers
Copyright 2013 New Markets Advisors
Variables to work through
• Mandate – What does this program do and not do? What is its portfolio plan?
• Process – What process should it follow? How to balance planning with entrepreneurism?
• Governance – How to balance flexibility with buy-in? • Metrics – What is success? How is that measured before programs are
scaled up?• Staffing – How do we provide incentives to staff throughout the
organization to collaborate on innovation?• Mechanisms – How do we facilitate idea sharing and outreach?• Impetus – What must come first? Where do we direct the energies of the
broader organization?• Culture – How do we address cultural issues? What are the biggest
impediments and the bright spots?
9Copyright 2013 New Markets Advisors
10
Relevant services from New Markets
Light-touch counsel on strategy-shaping process
Facilitation of consensus-building meetings
Deeper involvement in strategy and solution creation
Structuring of primary research and interpretation of results
Business plan creation
Copyright 2013 New Markets Advisors
11
Who is New Markets?
• Experts in reframing market space and generating growth• Senior
experience• Creative and
pragmatic• First-class
consultants, thought leaders, and entrepreneurs
Recent Clients
Copyright 2013 New Markets Advisors
12
Our team’s publications have appeared in:
Copyright 2013 New Markets Advisors
13
Contact
Stephen WunkerManaging DirectorNew Markets Advisors245 First Street, 18th FloorCambridge, MA 02142 USATel. +1 617 337 3060Fax +1 617 337 [email protected]
Copyright 2013 New Markets Advisors