Monday, October 24, 2011

An Innovation Paradox - Succeeding by Failing Faster

Development lifecycles have been shrinking rapidly so those that do spend extraordinary amounts of time over developing a new product or service will lose out to the competition. Also, our competitors are developing the ability to catch up and copy our initiatives even faster than before. We must therefore develop new ideas quickly and be ready to repeat that process after a short time. There will therefore be more frantic development activity.

Our frantic actions might increase the frequency with which things don't go according to plan but reduced preparation and planning time also increases the risk of failure still further. The number of failures we have must go up! Some people say "these are not failures, they are learning opportunities". Any lessons worth learning must be captured but if we did not achieve our objective then we failed. What we have to do next is to pick ourselves up quickly and try once more.

Dusting ourselves off and trying again is not unusual for many people who spend their time in laboratories or similar environments, however corporately we tend not to tolerate failure so we call it something else or sweep it under the carpet. The boss wants to know how many times you succeeded, not how many times you failed. But what if you calibrated your innovation pipeline and determined that only 1 in 10 projects succeeded. You could report either that 1 succeeded or 9 failed. Imagine now that you have developed a rapid process for bringing ideas to market but that the ratio of success to failure was still the same. Your boss might be unhappy if you tell him that you have had 900 failures in the same period of time but the flip side is that you will also have had 100 successes.

Assuming that we are not failing due to incompetence then both numbers actually indicate our level of activity. In reality it does not matter which set of numbers we use but those who sit around the boardroom table must understand that the more we do and the faster we do it, the more likely we are to fail. The flip side is that the more we do and the faster we do it the more likely we are to succeed.

The upshot is that we must become more comfortable with the concept of failure whatever words we use to describe it. We must become smarter about failing and focus on lessons learned not punishment and our corporate cultures must change to reflect this.

Monday, October 17, 2011

Innovation - Where Are Your Weak Points?

In many cases it is our starting point that is a major weakness. Have we got our Innovation Strategy right? At what point do we commit energy and resources to bringing a new idea to market? Often the test is whether the new idea has potential for creating value for the organisation. Unless you have started a business from scratch, providing resources for your new idea may remove resources (people, money, materials) from other areas of your business. The question you must ask is not just 'will it work?' but 'can we get it to work without any damage being done to our current business?'. Our Innovation Strategy is thus firmly tied to our long term objectives.

Do you go with all of your new ideas if they look like they will work? How do you select which ones to work with? Selecting idea needs to be ruthless carried out. Ask yourself the following:

  • Does it work?
  • Is this aligned with our objectives and company values?
  • Can this be scaled up or transferred to a different cultural setting?
  • Does this help or hinder our other activities

In short our inventors must develop some business capabilities!

New ideas are complex. They are often generated to solve a problem but to get an idea to market may provide further challenges. A new drug may cure a disease but it may have side effects, be expensive or difficult to package or have a short shelf life. To create value you need to show how your new idea will create value for your customer perhaps through time, cost or efficiency savings. You cannot simply say, 'Here is the new wonder drug' and expect hospitals to be placing orders immediately.

How high do you set the bar when testing your ideas? Do you use objective or subjective tests? It is better to have a mixture of both and ensure that all of the criteria that you identify are met. Another way of testing is to use existing customers. They are often flattered when you think they are worthy of trialling your very latest innovation! But, not everyone does this!

A huge potential problem area is the window in time where your idea or prototype is turned into reality. Your development team throw the idea over the wall into production and think 'job done'. Until you are selling gizmos buy the lorry load, everybody should still be contributing although the balance will change. You will need more human resources than you thought and also more cash. There is also a danger of stagnation as your new product or service falls into the gap between development and production. A highly motivated and charismatic leader is needed to ensure to see things through.

Do you have everything you need to get your new idea into the market? Have you considered external partners, especially if this might improve your success rate? Even if you have, how ready are you in terms of a) people b) protecting intellectual property? Sometimes the 'missing ingredient' needs to come from elsewhere.

Even when you have considered all of the above, have you spent time looking at the culture of innovation within our organisation? If innovation is a separate entity rather than embedded completely within the business, how do you cope with this? Do employees rotate through the innovation function and if not does this create tension? How is the learning from the development process captured and then disseminated? Just ask yourself, does the way we do things round here help our hinder our innovation efforts? You will be surprised at the impact that small changes can have.

Monday, October 10, 2011

The Map Is Not The Territory

To have a shared understanding with one or more people it helps to understand they are not using the same map as you are.

Neuro-Linguistic Programming (NLP) practitioners tell us that even though we may believe other people are like us, the truth is that each of us has our own personal perception of the world. As human beings, we respond to people, situations, events and circumstances through our internal maps. Our maps can be likened to a camera lens filter. Every experience we have from the moment of birth to the present serve as filters through which we perceive current events and situations in our lives. These filters, or maps, influence our reactions and decision making in the here and now. Two people who share an experience will often notice significantly different things about that experience, respond differently and store different memories of the experience.

So NLP tells us that “the map is not the territory", it is our individual interpretation of the territory. Great, NLP folks can tell us something useful, but how is this useful to us?

Being relatively new additions to the business leader's toolkit, creativity and innovation are topics that inspire a huge number of articles and books to be written. Some of these contain insights and wise words but many are 'how to' books. Remember that these are 'maps', somebody else's perception of what is happening/has happened in the past. Not only are many context specific but much information is often left out.

Many an innovation initiative has become de-railed because someone has read the book and failed to appreciate that it is not a step by step guide, a map that covers all eventualities. By all means buy more books and consult widely about the territory that you are entering. Also remember that as long as you have your wits about you, exploring can often be the best way to map out your own territory.

For the same reason, creative techniques should also be properly researched. Some such as visualisation can cause distress if used incorrectly and others can cause anger as well as not having the effects that you were anticipating.

Remember that to explore new territory you need to obtain or create a map especially when passing on knowledge to others. How often has the CEO's speech been misinterpreted because employees do not share the same perception or vision of the company? Never forget that "the map is not the territory".