Посты с тэгом: Fortune 100

Complementary Innovation

Published date: September 10, 2008 в 9:19 pm

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Companies are enamored with chasing “white space opportunities.”  White space is the nickname for new, undiscovered growth segments.  It spins the notion that opportunity lies just ahead of us.  Telling colleagues you are working on white space opportunities suggests you are doing really important stuff.  It is the ultimate growth endeavor, the risk worth taking.  White space will save the day.

I’m not so sure.  I have two problems with white space.  It is neither white, nor a space.

White space has come to mean many things:

  • WhiteSpace (Resource Scheduling), name used since 2002 to denote available time for People or Resources when scheduling time
  • White space (visual arts), or negative space, the portions of a page left unmarked
  • Whitespace (computer science), characters used to represent white space in text
  • Whitespace (programming language), an esoteric programming language whose syntax consists only of spaces, tabs and newlines
  • White space (telecommunications), unused radio frequencies in the VHF and UHF bands allocated to television transmission.
  • White space (education), term used since 2007 in the Singapore Education System to denote time reserved for teachers’ personal reflection and planning.
  • White Spaces Coalition, a group of technology companies aiming to deliver broadband Internet access via unused analog television frequencies
  • White Space (business), the part of a market or segment that is available to a business or entity for new sales or customers
  • White Space (Process improvement and management), the area between the boxes in an organizational map, often an area where no one is responsible.

The common theme seems to be the notion of white space as a void, untapped and unused, free and clear – like powdered snow yet to be skied.  If only we could find it (or get the government to give it to us as Google is seeking)!

Where do companies look for white space?  Jim Todhunter at Innovating to Win has published a survey with some very important insights to this.  Most noteworthy is how low respondents rated Complementary Products, a mere 6.3% as a source for white space opportunities.  Jim’s advice:  “Reconsider how to look at the red ocean opportunity spaces to expand your market footprint through complementary offerings.  This could be a great less traveled path to revenue growth.”

I agree with Jim, but what is curious to me is why this path is less traveled in the first place.  My sense is that companies overlook these complementary innovations because they are too focused on new opportunity defined as a market space rather than a boundary or frontier.  White space is not a space at all.  It is the fringe of what your are currently doing.  The term – adjacency – seems to be a much better way to define it.  White space is not white either.  Complementary innovations are deeply colored by what we know and have experienced.  There is always an old idea buried in a new one.  This is why tools such as S.I.T. and Goldfire are so effective at innovating at the fringe of the current business model – they leverage what is known.

Fortune 100 companies will find more growth opportunities at the margin of what they are doing than by chasing far-flung, ethereal market voids.  Leveraging at the margin takes advantage of existing core competencies and strategic assets.  It yields innovations that stretch the portfolio and the brand.

Stop chasing white space and look for the brightly colored complementary innovations right next to you.

Innovation Telltale

Published date: June 28, 2008 в 2:10 pm

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If you want innovation in your company, hire innovative people. But how do you know if someone is innovative?  What do you look for?  What telltale evidence might suggest that a person has superior innovation skills?

Several years ago, I ran a youth hockey league for ages 6 to 18.  A laborious part of this volunteer job was managing the selection of players for the elite travel teams.  Fifty or so boys would compete for twenty slots on one of 20 teams.  A group of coaches rated players on skating speed, puck handling, passing, and shooting.  As league commissioner, I attended each evaluation…that’s right…all them.  That’s 100 hours of evaluations plus many more hours tabulating the data, selecting players, and communicating with parents.

One year, I noticed something unusual in the data.  A bit of regression analysis of the evaluations told a remarkable story: every player selected on every team also happened to be the fastest skaters in their tryout pool.  In other words, we could have selected players with one simple variable, skating speed, instead of the tedious coaches’ ratings of multiple skills over multiple sessions.

I was shocked.  We could have done a simple race from one end of the rink to the other, about 10 seconds in duration, for the entire group of candidates at each age group.  The first twenty to cross the finish line make the team.  Skating speed was essentially a predictor of all other hockey skills.  It was a telltale of hockey success.  Fifteen minutes of time trials could predict with perfect success the best players for twenty teams instead of 100 plus hours of evaluations.  It could have been that simple.

What is the telltale of innovation?  I think I know the answer.  But, just as with the youth hockey experience, I will need to collect data to be sure.  My hypothesis is mental searching speed, an idea that Yoni Stern at S.I.T. taught me.  This is a measure of how well you “Google” your own mind and memory for information or experiences when given a task.  The task in the case of innovation is to take a Virtual Product (a mental abstract produced through the S.I.T. method), and mentally search your mind to find many productive, innovative uses for it.  Whoever can find the most ideas for a given task is more innovative in my view.  They “make the team.”

My task now is to select a different team – a team of research collaborators to find and validate the Innovation Telltale, something the Fortune 100 will surely value.

Innovation Muscle

Published date: May 18, 2008 в 12:37 pm

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The best Fortune 100 companies see innovation as an ongoing capability, not a one time event.  These companies work hard to build muscle around this capability so they can deploy it when they need it, where they need it, tackling their hardest problems.  Companies do this to keep up with the ever changing landscape both inside and outside the firm.
What does it mean to build innovation muscle?  I think of it as the number of people trained, the frequency of using an innovation method, and the percentage of internal departments that have an innovation capability.  Call it an Innovation Muscle Index:  N (number of trained employees) x F (number of formal ideation events per year using a method) x P (percent of company departments with at least one employee trained in an effective innovation method).   IMI = N x F x P .
Building innovation muscle is not much different than building body muscle.  Let’s turn to an authority, http://www.muscleprogram.com/, and see how to build body muscle.  Here is an exact quote taken from that website.  Then I have overlaid my interpretation of it from an innovation point-of-view in parenthesis and in bold font.

“You need to decide what kind of (innovation) muscle form you’re looking to achieve. Drawing on examples nearly everyone is familiar with, you need to decide if you want to look like Arnold (GE) Schwarzenegger (bigger bulk) or Bruce (Apple) Lee (lean and toned). This decision will help you determine which kinds of exercises you do and how you do them.

Now, with all of that out of the way, let’s look at some things you can do to build your (innovation) muscles!
If you don’t already, start getting your body (company) used to working out. Start running (innovating) every day, not jogging (brainstorming) or walking (copying others), to help get your blood (growth) moving and your (innovation) muscles primed for building. You’re not running a race so you don’t need to be a speed demon. Instead, maintain a comfortable and steady pace, taking long and powerful strides (initiatives).
If you want to have the lean, Bruce (Apple) Lee appearance, you need to work with lighter weights and have a higher number of repetitions (innovation workshops) in each set. By doing this, you are toning and shaping your (innovation) muscles into longer and thinner forms. If you want the Arnold (GE) look, you need to work heavier weights (more departments using innovation) and do fewer repetitions. By doing this, you are toning and shaping your (innovation) muscles into short and thicker forms.
Ensure that you have a regular plan, focusing on specific (innovation) muscle groups, and stick to it. Don’t try to work every (innovation) muscle in your body every day of the week. At best, this will lead to burnout (budget crunch) and at worst it will lead to injury (downsizing). Your (innovation) muscles will be getting worked hard, so they need to have time to recuperate.
However, you should rotate your plan every month. For example, let’s say that you are working on your chest, shoulders and biceps (new products) on Monday; your abdomen, forearms and upper back (new services) on Wednesday; and your lower back and legs (new strategies) on Friday. Every four weeks, rotate one day so that you’ll be working on your lower back and legs on Monday; your chest, shoulders and biceps on Wednesday; and your abdomen, forearms and upper back on Friday. The following month, rotate one more day.
This will allow each of your (innovation) muscle groups to take advantage of the fact that you probably workout differently on each of those days. If you simply stick with the exact same schedule forever, then you’ll find yourself quickly running into what are known as “plateaus,” where you just can’t seem to build that (innovation) muscle group past a certain point. With a rotation schedule, you will avoid this problem by giving each (innovation) muscle group the benefit of your natural changing body (company) rhythm.
If you keep these general guidelines in mind and consistently work at your plan with passion and intensity, your body (company) will be more toned (competitive) and shaped (growing) than you ever imagined it could be. While it won’t happen overnight, it probably won’t take as long as you’re afraid it will.”

The Dream Catalog

Published date: March 30, 2008 в 3:31 pm

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For many companies, the catalog of products is the strongest statement of brand positioning a company can make.  It is your arsenal of commercialization.  So imagine you could peek into the future and see a copy of your company’s product catalog five years from now.  What would it look like?  What if you could design it now?  What would you put into it?  These are the questions that confront you when you use a clever innovation tool called the Dream Catalog.
The Dream Catalog is a hypothetical company catalog from the future…well into the future, beyond the next business cycle.  It is far into the future so that it captures the innovative thinking and imagination of today’s managers.  It stretches a company’s thinking about its future, and it provokes a healthy discussion about possible company direction.  A good Dream Catalog causes tension.
A Dream Catalog helps a company in several ways.  It sets direction.  It suggests how the company is going to add and remove products from the line over time.  It forces the marketing team to reconcile product line strategy.  It provides placeholders for new discoveries, inventions, and even acquisitions.  It provides a sense of prioritization of what should be developed and in what order.  It can even help forecast revenues.
Best of all – it rewards and encourages innovation.  The Dream Catalog serves as the focal point for company-wide innovation efforts.  Employees strive to come up with product and service ideas that “make it” into the Dream Catalog.  As the catalog takes shape, employees see how their future is taking shape.  It guides their innovation efforts even more.  Leaders can use the catalog as a motivational tool.  “Let’s turn this dream into reality…for our customers and our future.”  A good Dream Catalog creates excitement and a sense of purpose.
I teach MBA students how to create a Dream Catalog in a full credit course called “Applied Marketing Innovation.” Here is a quick snapshot of how to do it.  Create a slew of new product embodiments over your current product line as well as products in your industry you wish you had.  Do this using an efficient method such as Systematic Inventive Thinking.  Mix the ideas together with your current product line.  Put yourself five or ten years out and envision what product offering would make your company the most amazing market leader in your industry.  Using your “palette” of ideas, pull in those that, taken together, create that kind of company.  Strive for product line coherence.  Strive for differentiation.  Strive for a customer centric solution.  Then, make an actual catalog with product photos, prices, features, and benefits.  Make it seem real.
Stanley_tools_newHere is a neat trick.  Take all of your company’s catalogs as far back as you can and lay them side-by-side chronologically.  Study the product offerings each year and note the changes over time.  Note the new products, deleted products, and changed products.  Do you see an evolutionary theme?  Revolutionary?  Stagnant?  Now place your Dream Catalog five or ten spots ahead of the most recent catalog.  Where will your Dream Catalog take you?  How far, how fast, how cool?
Think about Fortune 100 companies that might have a Dream Catalog of sorts.  Think about former Fortune 100 companies that have since perished.  Did they have a Dream Catalog?  Would you buy stock in a company if it did not have a Dream Catalog?
Dream on.

Funding Innovation

Published date: January 10, 2008 в 10:02 pm

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Mitch Ditkoff takes on the all important issue of how to fund innovation, and writes about innovation slush funds as a way improve innovation results:

What I like about this approach is that it sidesteps the bureaucratic hokey pokey, run-it-up-the-flagpole, command and control, funky chicken shuffle that all too often scuttles powerful new ideas in need of a timely infusion of capital to get them rolling.

From my experience, there are two choices in how to fund innovation:  invention or development.  Invention means the actual genesis of the idea, usually through a concentrated effort or workshop using a proven method.  Development is what you do with the ideas that have commercial merit.  Both take time and money.  The choice depends on whether you think spending the money to generate ideas will yield more than a pool of funds to invest the ideas that you already have.
Fortune 100 companies vary widely in how they approach it.  Some invest in idea generation to create large stocks of potential opportunities.  They invest in innovation teams and processes to keep innovation happening day in and day out.  The ideas generated must compete for resources against the rest of the portfolio of opportunities.  The other approach is to create a bounty like what Mitch has described…a slush fund to motivate and lure the creative people to come up with ideas.
My preference is to fund invention, systematically.  My sense is that employees need to feel there are sufficient resources and sufficient time for them to take the risk of ideating.  By investing in the ideation process, employees feel liberated to give it their all.  I think the idea of a slush fund makes sense if it is used for pure ideation.   Tell people there are dollars available to conduct formal ideation workshops…a slush fund…and they will beat a path to your door.  That’s what I do.   As Mitch puts it:

And remember, as one wise pundit put it, “It’s not the money that starts the idea, it’s the idea that starts the money.”

Fund ideation, and the result will yield more funds.

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