stargeek
BLOGS IN BUSINESS -- WHAT WE COULD DO NOWBLOGS IN
|
 I've written before
about Blogs in Business
and the role I think they could play. But my idealism -- the desire to
have a better, simpler blog product with some better social networking
functionality before we try to sell it to business -- is giving way to
my impatience. A couple of business leaders have challenged me to
develop a pragmatic strategy for effectively introducing blogs into a
business today. Here's what I
said.First, the strategy for doing so must respect some fairly unorthodox principles. If it doesn't, blogs will just end up being one more awkward and confusing part of already unwieldy and underused corporate Intranets. These principles are:
OK, on to the strategy. Here's a twelve-step plan I think could work in just about any organization, large or small:
|
 As you may know, I've been maintaining (manually) detailed tables of contents of my blog posts (one per blog 'category') since I started. They're a bit clumsy, but they get a fair bit of traffic so I know people are using them. Right now they exist as six 'stories' and I thought it might be interesting to try to put them together into a single, interactive index. I'm competent in neither HTML nor Radio's 'outlining' function (I confess I don't even know how to use anchors properly -- the twisties below and the links in the graphic above don't work, and links below should really take you to the specific subcategory within the table of contents), so I can't make it pretty or functional, but you can get the idea of how it might work:  BLOGS
& BLOGGING:BUSINESSSocial
Networking
Blogs in Business Knowledge Management & Learning Innovation Entrepreneurship New Collaborative Enterprise Advice for Knowledge Workers ARTS
& SCIENCESLiterature, Language, Communication
Stories and Narrative The Arts Sciences & Social Sciences Technology Miscellaneous Posts ENVIRONMENTAL
PHILOSOPHYHow to Save the World
New Collaborative Enterprise Other Environmental Articles Overpopulation Animal Rights Activism Environmental & Social Economics & Law Stories and Narrative Other Philosophical Articles POLITICS
& ECONOMICSLiberty,
Democracy and the World
The Bush Regime & US Politics Globalization, Corporatism, Free Trade Governance & the Political Process Economics Environmental & Social Economics & Law The Education System Canadian Politics Iraq & the Mideast CREATIVE
WORKSMy six categories have a total of 40 subcategories, of which five (Blogs in Business, Technology, Stories & Narrative, New Collaborative Enterprise, and Environmental & Social Economics & Law) overlap categories and hence appear under two categories each. The ten most popular subcategories (most linked, and most commented-on) are shown in bold. This taxonomy is essentially the same one I use for my filing cabinet tabs and for my My Documents subfolders, except that they omit the 'housekeeping' type tabs and subfolders that house my background papers, messages and private and personal records. I am not offering this as any kind of framework for a 'universal' taxonomy. In fact, I've been adamant that any personal content management system needs to allow us to index our documents and messages any way we want, our way, at whatever level of granularity works best for each individual. Universal taxonomies just don't work. But if we think of a blog as the 'public area' of our personal content, the shareable part of our personal 'filing cabinet', I thought it might make an interesting case study in how we might best 'present' each individual's publicly-available 'stuff' for effective browsing by others. I see the blog, and at a broader level the 'tabs' of our personal content management system, our 'filing cabinet', as nothing more than 'addresses' or destinations to send content to. So although Microsoft would have us believe that 'saving' a document or message, 'sending' a document or message to someone else, and 'publishing' a document or message to a blog or website, are three fundamentally different functions and applications, I see them as conceptually indistinguishable -- they're all actions that move content from one specific space to another. That's why I have proposed a single, intuitive Workspace Manipulation and Document Annotation tool to replace virtually every application users have on their PCs today, a tool that would finally make PCs accessible to the billions of technologically challenged among us. But I digress... I can envision the Interactive Blog Table of Contents working in one of two ways:
Ultimately, I can see the development of an invisible (to the user) 'metadata layer', which would take our preferred organization of our personal stuff and translate it into some universal standard, and then as needed into each reader's personal organization of his/her content, so that for example if Jon Husband wants to browse my publicly permissioned content, he won't see it organized as I have, above, but will instead see it automatically reorganized and relabelled using his personal taxonomy and nomenclature. I believe this 'metadata' layer development will be one of the most interesting and important technology challenges of this century. In the meantime, if there's sufficient interest, I'll buckle down and learn enough HTML and Outlining to implement either solution (1) or (2) above for my blog. |
 I've updated the Dire
ctory
of Active Salon Blogs. Please send
me details on any missing and new Salon Blogs, and errors in the
Directory. I promise to post any updates I receive at
least once a week.There are now 159 active (updated in the last month, or officially on vacation but returning) Salon Blogs. Comings & Goings this past month:
Some stats for this past month:
P.S. I've also updated my Tables of Contents (see top left of my blog). Since Google has, for some reason, stopped crawling How to Save the World, Google is no longer a reliable way to find things in my archives. I'm going to test some other search engines and change my search bar accordingly. |
 I've just adding another dozen items to my already bloated blogroll. I'm actually quite discriminating in what I add, rejecting most of the requests I get to 'reciprocally' blogroll, and never adding a blog until I've seen at least two remarkable posts on two different days. There's just a lot of great writing out there! Here are a few of the blogs I've added this time: Practical Metaphors - Ryan Fugger finds amazing things on the Internet that no one else seems to find. Check out this post linking to the provocative short film 'Bullet in the Brain' you can download (bandwidth permitting). Ryan's another reader of Daniel Quinn's Ishmael. He's an articulate essayist on how to make the world better, and a contributor to the Blogger's Parliament. A Relative Path - Jonathan Broad has a brilliant wit and an ability to succinctly summarize current events and contemplate their deeper meaning. He's also a pessimist willing to look at the horrors of our recent history and discuss what they tell us about human nature, and what we could do to avoid repeating them. Bastish - Kevin Cameron's great photoblog that I neglected to include in my recent post of favourite photoblogs. The picture above is one of Kevin's. He's currently living in Japan, which must be a photographer's dream. Orcinus - Seattle journalist and liberal A-lister Dave Neiwert doesn't need any publicity from me, but he's a great writer and covers, prolifically and in detail, well-referenced and supported, the foibles of the Bush regime. Globalize This - A new blog by Adam Hersh, a researcher at the Economic Policy Institute, has astute observations on economic and trade matters, which are going to be of crucial importance in the coming months and years. In addition to explaining economic matters in understandable terms, with a progressive slant that I of course appreciate, Adam also covers the work of senior economist and colleague Max Sawicky, whose blog MaxSpeak I've also blogrolled. And on the business/IT side, I've added Stephen Downes' and David Wilcox's blogs, both of which articulately cover the emerging world of social networking and its role in business and society. |
| Four
years ago I wrote a well-received paper entitled A Prescription for Business Innovation:
Creating
Technologies that Solve Basic Human Needs. I've updated it,
broken it into three manageable pieces, and present the second part
below. The first part, which reviewed the history of human innovation
and technology, is here
and the third part will follow next Tuesday. Four: Innovation & Society: How Technologies Limit Freedom, Human Nature Confounds Innovation, and Consumer Decision Tools Doom Marketing  Those
of you with HR backgrounds are probably wondering why I have not
spoken
about non-individual, community aspects of civilization and why and
how
these arose if the innovative individual is perfectly able to do it
all
him- or herself. These issues are relevant because of the role of
teams, organizations and other social constructs in the process of
innovation.Let's take another look at our proto-human, now equipped with the six basic types of manually powered machine (lever, wheel, screw, pulley, plane, and wedge -- the latter in the form of flint-head arrows), plus other early innovations like controlled fire, animal domestication and crop cultivation. Like other creatures he's adopted the family unit as a social convention, but now he's experimenting with a more sophisticated social construct, the tribe. Question is, why? Is it Darwinian -- Did humans that banded together have a higher likelihood of survival than loners? Or is it purely social -- Do humans, like other creatures, have a basic need for social contact with others that goes beyond family? Whichever it is -- a survival need or a social need, it required innovations to make it work, innovations like a code of laws and behaviours to prevent and resolve disputes between individuals, and shared language. At this point, in the view of some anthropologists, a tug-of-war began between our essential individual, autonomous nature and the perceived benefits of increasingly advanced, abstract and restrictive 'technologies' like division of labour, specialization, private and communal property, governments and other hierarchical social organizations, including the modern corporation. All these social 'technologies' limit individuals' freedom, and much of our civilization has been about trying to find a delicate balance between individual 'rights' and the apparent benefits afforded by technologies that compromise them. This tug-of-war continues to play out today, in our suspicion of government, the existence of 'militias', libertarian movements, evolution of privacy laws, and struggles over property ownership. The battle is far from over, with slavery, one particularly extreme social construct favouring hierarchical efficiency over individual liberty, still practiced in many countries, and women, children and animals treated as property with no rights or freedoms whatsoever in many others. This tension also plays out in the modern corporation, itself a feudal social construct which is neither egalitarian nor democratic. Corporate efficiencies have produced technologies that have massively improved material wealth and (most believe) quality of life in the few centuries since they were invented. But these advantages have come with a huge cost of personal freedom -- In many countries employees are virtual slaves of their employers, with no hope of realizing their full personal potential. In many companies promotion and remuneration have nothing to do with performance or competency. Here are some of the consequences for innovation of this individual/collective tension, in today's companies:
Perhaps this is a universal trait that we need to consider when designing innovation programs: Everyone loves to engage in social activities that are fun, challenging and unthreatening, but when the social activity impinges on individual 'territory' or property, or on scarce resources, social and collaborative behaviour ceases and confrontational, competitive behaviour takes over. But isn't competitive behaviour exactly what business thrives on? Doesn't the rush of adrenaline and testosterone in the quest for competitive advantage and 'winning' yield high productivity, sharpened customer focus, and more new ideas? I would argue that competition is at best a neutral factor in engendering innovation, and may in fact be detrimental. Most of the books on teamwork, such as The Wisdom of Teams, stress two essential preconditions to effective team behaviour:
Furthermore, many businesses are now reaching out to involve customers, alliance partners and even competitors in their problem-solving teams, because they help bring different points of view to the creative process, and because these external partners share both the defined problem and the sense of urgency with the internal team. In a world of accelerating change, no competitive advantage is sustainable -- innovations and new technologies can almost instantly reinvent industries, products, services, and offerings, and eliminate any competitive advantage the old ones may have had. Despite massive and sustained oligopolistic efforts to prevent it, customers are beginning to wrest absolute control of business direction and success from almost every industry's producers, management strategists and marketers, and now set the agenda and reward companies that respond to their needs and build new serving capability, not those that bash the competition, sue their customers, or create barriers to competitive offerings. The Bush regime's corporatist agenda has been only a temporary setback in this inexorable trend. A side-note about branding: Many marketing people, lamenting over the passage of market control from producer to consumer, cite the increasing importance of branding as an organizational strategy, and of brand loyalty as a success factor. For this reason, they argue, aggressive, proactive marketing is not dead. They fail to appreciate that consumers, faced with the severe scarcity of (a) time to assess product alternatives and (b) objective comparative analysis like Consumer Reports, tend to use 'brand' as an unsatisfactory surrogate decision-making tool. If you as a consumer want to buy a car, or select a television program to watch, the ideal decision-making process would be:
Tools like these exist today (Consumer Reports is an example of the former; the Recommendations Lists of Amazon.com are an example of the latter), but they are not yet very robust or reliable. In their absence, brands and brand loyalty are the surrogates: 'I always buy Chrysler products' or 'I usually watch CSI on Thursday nights' is your brain's way of substituting brand for the more ideal tools noted above. Once these tools exist (and the Information Age is ripe for them), product brands will simply become community-identification brands ('I drive Chrysler products because they reflect who I am and I want others to see that and associate with me, or not, because of that identification'). At this point, brand community-association becomes merely one more selection criterion of the analytical tool. With the advent of the near-perfect consumer information these tools provide, traditional marketing has no remaining role, and the knowledge-driven transition of power from producer to consumer is complete. Five: The Structure & Culture of Innovative Organizations: Business Gets Feminine and Consumers Seize Power from Producers It is now accepted wisdom that the organization of the future must be flatter, more empowering, less hierarchical and more networked, in order to be sufficiently agile and responsive to the ever-more-powerful customer's needs. Much has been written about organizational 'ecology' and the ability of communities of practice to self-organize to solve identified common problems more quickly and effectively than command-and-control driven organizational structures. There is a growing awareness that self-organizing communities operate best when their leadership uses what are usually considered 'female' modes of operation rather than the traditional 'male' ones:
These issues are important to the future of business innovation. We must decide whether an organization saddled with the structures and controls of an old 'management' style can hope to be sufficiently agile, responsive to customers, creative and focused on new product development, to survive when that survival depends on strategic improvisation and continuous innovation. There are two huge and contradictory trends occurring in organizational structure today: globalization and fragmentation. Globalization is occurring because small organizations cannot achieve the scale and resource capacity needed to be viable, and fragmentation, the spinning off and incubation of small, narrowly focused 'best of class' companies, is occurring because large organizations are too unwieldy, inefficient and inflexible to be innovative and respond to customers' rapidly evolving needs. So we have today the worst of both worlds: large, fat, unresponsive global companies and emaciated unscalable small ones. Furthermore, because of today's concentration of money and power in the hands of increasing global corporate giants, this system is in disequilibrium, with dysfunctional non value-added consequences such as these:
Those with an entrepreneurial bent would form, or join, one or more Producer or Innovator enterprises over their working life. Those with a productivity bent would gravitate towards the Global Utilities. Many others would be self-employed, providing niche advisory services to all three types of enterprise. You may think this is a very idealistic view of how 'organizations should be reorganized', but it is also a very logical one, and one that could easily be achieved today because of growing dissatisfaction with the dysfunctionality of today's organizational structures, and the ability, thanks to the Internet and other powerful new 'organizing' infrastructure technologies, to bring this 'reorganization of organizations' about. Only a poverty of imagination, opposition from elite vested interests, and the inequitable distribution of power and resources, all of them well within human capability to rectify, are preventing us from realizing this potentially liberating, perhaps even Earth-saving, reorganization. In fact, this customer-driven revolution is already happening, quickly, quietly, and non-violently, its first manifestation being what Shoshana Zuboff in her best-seller calls The Support Economy: Why Corporations Are Failing Individuals and The Next Episode of Capitalism. The advent of a New Economy, with Innovators focused intently and exclusively on solving real human needs and problems (and not on the hyper-marketed, artificial incrementalism and 'copycat' and 'sequel' new product development that today's risk-averse oligopolies have our most creative minds fruitlessly working on) offers the potential of astounding acceleration of innovation and resolution of seemingly intractable human problems: pollution, over-population, unemployment, inequality, human and animal suffering, disease prevention, war and cruelty, biodegradation, mental illness. Some would say it's not a moment too soon. What does all this mean for today's company looking to jump-start its innovation programs and processes, and today's individual looking to participate in making his or her own, or his or her employer's, enterprise more innovative? From the discussion above we can add six principles of innovation strategy to the eight principles developed earlier:
Attributes of 'Female' versus 'Male' Organization Structures (Adapted from Imperato & Harari, 'Jumping the Curve') So now we have fourteen principles to guide us in creating innovative organizations. Next Tuesday: In the final part of this paper, a prescription that draws on these principles, that organizations can use to evolve themselves into innovative companies. It will also explain the new 8-step Innovation Process diagram at the top of this post. |
 Diagram ©2004 The Caring Enterprise
Coach
Today, the average North
American entrepreneurial business lasts just four years, the average
sole proprietorship even less. Yet entrepreneurship is not rocket
science; it's nothing more (or less) than making a living for yourself
with your business partners, instead of depending on some indifferent
corporation to provide you with a living wage. Running a business is
certainly no more difficult than raising a family, or landing a job
and
building a career with a big company. The essentials of
entrepreneurship could easily be taught in every school, and there'd
still be plenty of time left for the rest of the school curriculum.
But, perhaps because big corporations and the governments they control
want the 'labour force' to be meek, subservient, fearful and insecure,
most people have come to perceive entrepreneurship as a complex and
difficult art, fraught with danger, unprofitable, emotionally
scarring,
and demanding of enormous courage and energy. "It's certainly not for
everyone", I keep hearing.Entrepreneurship requires self-knowledge of what you're happy doing, what you're especially good at, how much you're willing to put into your enterprise and what you expect to get out of it. Without this self-knowledge, you're likely to be as miserable in your own business as working for some unappreciative boss, and that unhappiness will bear directly on its success. Beyond that, all you need are common sense, self-confidence, and a modicum of four key, learnable skills:
One of the 15 steps in the process of establishing and running an enterprise is avoiding the landmines. In MBA school they now call this Risk Management. This article identifies ten of the major landmines for entrepreneurs, using some real-life examples. I don't believe any of the enterprises described below is still in business (though some of the entrepreneurs have moved on, learned their lesson, and succeeded in other businesses):
Another technique entrepreneurs can employ to alert themselves to potential landmines is establishing an Advisory Board made up of people who have well-rounded business experience, knowledge of markets, and skills the entrepreneur and his partners lack. Such Advisory Boards are often reciprocal, offering mutual support and advice in lieu of fees. I am constantly surprised how few entrepreneurs use such 'support groups', relying instead on their own instincts, the counsel of inexperienced and costly 'professional advisors', and others (bankers, customers, franchisors, and various 'agencies') who have only a nominal, and purely financial, interest in the entrepreneur's success. Some 'support groups' and networks have been set up as money-making ventures, but these tend to be unwieldy and their members terribly needy -- ten people looking for advice and new customers for every one capable of offering useful information or counsel in return. It's best to create your own. The problem, of course, is that most entrepreneurs are paradoxically too busy fighting fires and avoiding landmines, to be able to invest time finding and networking with support groups and other valuable advisors who can help them avoid the next round of fires and landmines. But, despite the failings of the first generation Social Networking tools, such tools hold enormous promise. Although Shoshana Zuboff coined the term The Support Economy to refer to federations of businesses working together to support their shared customers, the first true Support Economy may well be entrepreneurs supporting each other. |
 Time
for another of life's imponderables. Both in Canada and the US, family
farmers and small business people have, in recent years, consistently
voted conservative, and show every intention of doing so again this
year. This makes absolutely no sense: Most farm states and provinces
are net recipients of government largesse (i.e. they receive in
equalization payments and services more than they pay for, subsidized
by the more urban and more liberal states and provinces). And even
though in the past 20 years conservative governments have spent more
than liberal governments, that money has largely gone to tax cuts for
the very rich and defense spending, creating huge deficits that small
farmers and small business people have to repay in taxes, and receive
almost no benefit from.I talked to a few local farmers and small business people to try to find out why they vote conservative. This small sample may not be representative, but what they told me was:
In Canada, which has five parties to choose from, the 'first past the post' electoral system undoes the benefits of party pluralism. With the three small parties all socially liberal, Canadian liberals are forced to 'vote strategically', which means voting for the Liberal Party instead of their real choice, the NDP or the Green Party, to prevent the 30% of Canadian conservatives, who have only one voting choice, from stealing the election. We'll find out in ten days whether they did so or not. Alas, both the US Republican and the Canadian Conservative parties are consistently and heavily propped up by small farmers and small businesspeople. Without that support, these parties would be history. It doesn't make any sense, but it's the reality that both right-wing parties are counting on for election success this year. It's a brilliant con. |
| Four
years ago I wrote a well-received paper entitled A Prescription for Business Innovation:
Creating
Technologies that Solve Basic Human Needs. I've updated it,
broken it into three manageable pieces, and present the third part
below. The first part, which reviewed the history of human innovation
and technology, is here,
the second part, which described the current environment for
innovation, is here. Six: Prescription for an Innovative Organization The
first four years of the century have seen some serious setbacks in
business innovation. The corporatist-backed Bush administration has
introduced legislation to reduce corporate liability to consumers, and
has been extremely lax in enforcing social and environmental laws.
Organizations like the RIAA and Nike have showed that the courts will
allow large corporations great latitude to sue customers (including
infringing on their privacy rights) and to lie to customers in their
advertising (about sweatshop operations, offshoring etc.) Corporations
like Enron have abused public trust and destroyed thousands of
families' livelihoods and life savings. And massive defense and
security expenditures have siphoned off funds that might have been
invested in innovation, and have made corporations and lenders nervous
about any investment while governments and corporations are so
seriously overextended and exposed to interest rate fluctuations. The
result is a climate of great animosity between corporations and
customers, and unprecedented risk aversion.At the same time, recent surveys indicate a growing corporate awareness that "you cannot cut (or offshore) your way to greatness", that the limit to improving profitability by reducing costs and margins has now more or less been reached, and that innovation must again move to the forefront if corporations are to have any hope of sustaining that profitability. So corporations are looking for low-cost, effective ways to develop new products, new processes, new delivery channels and new technologies that will meet important human needs, provide real value to customers, and be affordable by those customers. This challenge occurs at a time when the distribution of wealth among customers is massively skewed, both within and between nations, towards a tiny elite, when many governments and most corporations and individuals are buried under a crushing debt load, and when the need for innovation to solve critical environmental, social and political problems has never been higher. Simply put, we are living in an age when we cannot afford innovation, and cannot afford to be without it. Perhaps the most critical innovation need therefore is for creative mechanisms to finance, price and pay for the costs of innovation itself. Funding, pricing, and cost management are now inseparable parts of the innovation process. The prescription I propose draws on a wide variety of innovation processes that have been advanced by thought leaders on the subject, especially during the 1990s when the appetite for investment in innovation peaked, including Peter Drucker's, Cap Gemini's, Credit Suisse's, Gary Hamel's, and others listed in the bibliography below. This prescription draws as well from several innovation processes that I am personally aware of from my years working with Ernst & Young and its clients, and some lessons from how nature, which has been innovating since long before we appeared on the planet, goes about it. This prescription has eighteen steps in eight stages illustrated in the chart above: Listen, Understand, Organize, Create, Experiment, Listen Again, Design, and Implement. The three stages shown in blue -- Understanding, Organizing and Implementing -- are analytical processes, well-suited to the left-brained deductive thinkers who predominate in most organizations. The three stages shown in green -- Creating, Experimenting, and Designing -- are creative processes, better suited to right-brained inductive thinkers who are relatively scarce in most organizations. The two Listening stages shown in red are communication processes, that need to involve customers and other stakeholders, and everyone in the organization involved in the innovation process. Assigning (or contracting) the right people for each stage in the process is essential to its effectiveness, and to its affordability. If it's done well, it can draw on the strengths of everyone inside and outside the organization who has a stake in a successful innovation effort. Here are the eighteen steps. They are in reasonably sequential order, but are somewhat recursive: For example, as part of creating alternative solutions (step 12) it may be necessary to go back and scan for some additional ideas (step 1). Who should do each step depends to some extent on the industry and size of your organization: Large organizations may benefit from having a dedicated Innovation Team responsible for this, while in a very small organization it may be a scheduled part-time task of the whole management team, drawing as well on the diverse backgrounds and ideas of an informal Advisory Board. Listen 1. Listen broadly for ideas: Appoint your Innovation Team and have them set up an 'environmental scan' that systematically looks for innovations and connections not only in your industry but also outside it, outside your country, outside of business entirely. Have the Team read about, learn about, and meet with people from the broadest possible spectrum of human enterprise and natural discovery. Subscribe to journals like Innovation, and the RSS feeds of periodicals and websites that report ideas and new technologies from a wide range of disciplines. Reward members of the Team for serendipitous readings and meetings, debrief with them promptly and regularly, filter, refine and inventory their ideas and learnings for consideration at the Understand, Create and Design stages of the innovation process. Inputs: readings, newsfeeds, conferences, interviews, meetings. Outputs: a manageable inventory of ideas and insights (categorized and contextualized appropriately so that they can be simply understood and practically applied). 2. Listen to 'pathfinder' customers, competitors, and colleagues: Plug yourself in to the 'voice of the customer'. Set a minimum time quota for everyone in your organization to spend face-to-face with business customers, or with customers' customers or end consumers. Identify 'pathfinder' customers -- those who are most attuned to their organization's future direction and its need to change. Employ a 'Think the Customer Ahead' program that engenders effective listening, elicitation skills, story-telling skills, and creative thinking skills , a capacity explained in Imparato & Harari's book Jumping the Curve. Often the customer isn't able to articulate his or her needs in a way that lends itself to quick technology solution development. Listening to the customer is an iterative process, that entails learning about the customer's business, understanding the things that keep them awake at night, suggesting a lot of 'what if's', proffering opportunities, points-of-view and possibilities, not just asking baldly about needs and offering off-the-shelf solutions. Connect with customers indirectly as well, using all the media at your disposal -- phone surveys, e-mail, website surveys, customer satisfaction surveys (with lots of open-ended questions), self-diagnostic tools, videoconferences, etc., to capture as much information as you can about your customers, their customers, and their markets. Inputs: conversations, interviews, surveys. Outputs: needs, ideas, stories, industry future state visions, five-forces and SWOT analyses. 3. Listen to the front lines: Talk with the people who hear directly from customers and other stakeholders every day -- people in sales, customer service, even delivery and reception staff. Ask them what they're hearing, and what they think most needs improvement or rethinking. Create 'space' -- physical and electronic -- where everyone in the organization can surface, discuss and advance problems, needs and ideas collaboratively. Let anyone 'subscribe' to the inventory of news and ideas created in step 1 above. Consider maintaining a running list of the company's Top 10 Challenges to encourage focus and creative thought from everyone in the organization. Make sure top-level executive sponsorship for innovation is visible to everyone on the front lines. Give people time off their 'regular work' to focus on organized innovation projects, and tools and process guidance to use that time effectively. Reward front-line people for new product and other innovative ideas that they surface from their conversations with customers and others. Inputs: conversations, idea & collaboration spaces, interviews. Outputs: needs, ideas, stories. Understand 4. Understand who your actual and potential customers are: Study companies like The Body Shop that know their customers, their needs, their buying preferences and criteria intimately. These are companies that spend a lot of face time with customers and have rigorous processes in place to capture what they learn, probe what they need, and explore the potential market for new innovations. And identify and get out and meet with potential customers as well, to understand why they're not already customers and what could change that. And then have your Innovation Team cast a wider net and ask who might be customers that are currently not served by either your company or your competitors. Learn the lessons of Christensen's The Innovator's Dilemma and The Innovator's Solution -- how disruptive innovations can (sometimes inadvertently) transform whole industries, and how that presents your company with both threats and opportunities that could completely change the profile or even definition of your customers. Inputs/Outputs: list of actual and potential customers and what they currently buy, could be buying, and will and won't be buying in the future, and why. 5. Understand and respect what end-consumers want and need: and based on that 6. Understand what immediate customers will need: Start with the end-consumer of your products and services, and the end-consumer of the products of your immediate customers. Their buying patterns, needs and preferences will determine the success of your customers, and that will in turn determine their buying patterns, needs and preferences. The end-consumer has the ultimate power, and, unlike corporations', their buying decisions are based on broader and more subjective criteria than business need and affordability. They buy things they want, not just things they need. If you sell to the auto industry, you need to understand why consumers, against all logic, buy SUVs. And if your company is making money from sweatshop labour or old growth forests, better come clean now. Business needs to end its abusive relationship with consumers -- overcharging them, misleading them, suing them, and selling them inferior, imported merchandise and services. Once consumers realize their true marketplace power, they will get back at adversarial suppliers with a vengeance. Business needs to respect them, respond to them, and be responsible members of the communities in which they operate. The Reputation Economy isn't here yet, but it's coming. If you cause consumers to dislike you or distrust you, you'll soon be dead. Inputs/Outputs: current state analysis and future state vision of wants and needs for both current and future immediate customers, and end-consumers, and a resultant future state vision and emerging needs profile for your industry. 7. Understand why these wants and needs aren't already met: Here's the hard part. Things are usually the way they are for a reason. You know there are wants and needs that aren't being met. The challenge is not to throw in the towel when you find out why. The technology doesn't exist? The solution would be very costly or risky to develop? The solution is not affordable to customers? The solution is too radical for customers to accept or too complex for them to understand? The organization currently lacks the capacity or competencies to produce the solution? That's what innovation is about. Take up the challenge with your eyes open about what must be overcome, but take up the challenge. If it was easy someone else would have already done it. Inputs/Outputs: list of challenges. Organize 8. Organize those with a stake in solving the problem: Now you know what needs to be done, the next step is to organize the troops. Who can help solve the problem, assess the alternatives, provide the needed resources? Outputs: project team member list, including 'pathfinder' customers and other outsiders. (Note that the project team is responsible for solving a specific problem or need, while the Innovation Team has oversight over the entire innovation effort of the organization -- they aren't the same group). 9. Organize the program for solving the problem: There are a lot of techniques and methods that you can use to break through a problem and come up with solutions. The bibliography below is replete with them. In my experience, creative minds need a very broad framework (schedule, budget, high-level process) and a lot of freedom to figure out how to solve the problem within that framework. Self-organizing, self-managed innovation project teams seem to work well in some organizations but not in others. If you insist on imposing more discipline on the process, more hoops to jump through, control points and early-stage go/no-go filters, make sure the people you're imposing it on see the value in these constraints, and that they don't squeeze the boldest and potentially most successful ideas out in the process. Outputs: project schedule, budget, program. 10. Organize the resources needed to solve the problem: The project team needs sufficient tools and knowledge to be able to understand the problem, the customer need, and the variables that could impact the potential solutions. Inputs: all the Outputs from steps 1-7 above, redrafted into a cogent and digestible form. Create 11. Create an environment and capability for innovation: Give the Innovation Team and the project teams permission to fail, and teach them how to fail early and inexpensively. Prevent executives from pushing their 'pet' projects to the detriment of others. Don't let the 'black hats' deep-six good, hairy, audacious ideas prematurely, and ensure that 'black hat' behaviours are not rewarded by senior management. Help the team avoid slipping into excessive caution or incrementalism. Keep the marketing group from unduly influencing the process with antiquated ideas for 'creating market demand' and launching products with press releases and self-serving promotional and advertising campaigns -- In the emerging customer-driven market these techniques will no longer make a mediocre product a success. Provide rewards and incentives for team members, and for other contributors to the innovation effort. Don't tolerate hoarding of ideas and knowledge, or inter-department 'charges' that block knowledge transfer and cross-functional collaboration. Share credit for good ideas and successes, and don't make innovation an area of internal competition. Help bright, creative, quiet people find their voice, and let people promote 'crazy' ideas without fear of ridicule. Teach the Innovation Team and the project teams (and others in the organization who show interest) techniques that will enhance their creativity and improve the innovation process, and give them time and resources to discover other techniques and try them out. Invest adequate, patient capital and resources for innovation. Give ideas sufficient time to find their market but don't throw good money after bad, no matter how well-intentioned. Understand sunk costs and learn from failures. Consider letting those involved in the innovation 'invest' personally in return for a share of the ultimate revenues or profits: Having some 'skin in the game' can be very motivating and empowering. Inputs: time, training, tools, space, sponsorship, leadership and resources. Outputs: people who are inspired, capable and encouraged to contribute productively to the innovation effort. 12. Create lots of alternative solutions: Don't put everything at risk on one option. Use scenario planning and other techniques to identify and assess alternatives. Don't reject the really far-out alternatives prematurely -- cost/risk/benefit decisions usually can't be properly made until the customers have had the chance to say their piece again in step 15 below. Outputs: alternative solutions. Experiment 13. Experiment: Try many things, learn fast from failures, tinker, iterate, combine, transfer: Try several alternatives simultaneously in different markets to speed up the assessment process. Use rapid prototyping and other iteration techniques to expose as many alternatives to the market as possible. Outputs: test results. Listen Again 14. Listen to potential customers and help them imagine: Use prototypes and stories to make the innovative product, service, channel or technology as concrete as possible. Beware customers' propensity to say 'yes' at this stage when there's no required commitment. Go back to what you learned from customers in steps 1-7 and recite what you heard back to the customers for confirmation, explaining how the innovation addresses the need articulated by the customers. Listen objectively for confirmation or dissonance. Outputs: customer evaluations 15. Listen to acceptance criteria -- the ‘if’s: If the product appears to meet the need, the next task is to assess the customers' buying criteria: price and affordability, convenience, options, delivery time, upgradability etc. Some of these criteria may be show-stoppers that will require re-invention or other creative brainstorming, while others may be able to be addressed in the design stage below. Outputs: customer buying criteria 16. Listen to ‘what could go wrong’: Here's where you let the 'black hats' say their piece: What competitive threats exist or could arise? Is the innovation vulnerable to disruptive innovation from unexpected sources? Are there unforeseen production, quality control, political, regulatory, financial, marketing, or servicing landmines? What's the shelf-life? Could it become a commodity prematurely? Will it be prohibitively expensive to produce or to buy? Will it cannibalize existing product sales? Is it a strategic fit for the organization? Some of these 'what could go wrongs' may require re-invention or other creative resolution by the project team, while others may be able to be addressed in the design stage below. Outputs: list of threats and risks, and resolution plan. Design 17. Design: consider customer-valued attributes, cost, intuitive ease of use, ease of change, ease of enhancement: The greatest idea in the world can still be torpedoed by bad design. The designer has to be told, in no uncertain terms, what attributes are important to the customer, how much at most the solution can cost, and the trade-off between ease-of-use and power. Technology products especially are often over-engineered because additional functions and features are easy and inexpensive to add, but they add complexity disproportionate to the benefits of the additional functionality, often to the point of turning off potential customers. And in this age of constant upgrades and inter-operability requirements, the solution must be easy to change, redesign and enhance. Inputs: specifications based on Outputs from steps 12-16 above. Outputs: completed designs. Implement 18. Make the final go/no-go decision, then implement: If there are still several alternatives on the drawing board, whittle them down to a manageable number. If necessary, send the idea back for reinvention (step 11), re-testing (step 13) or redesign (step 17). If the previous steps have been done properly, this step should be the easiest. Once the decision has been made to go, the set-up, production, viral marketing, sales, distribution, employee and user training, partnering, after-sales service, success measurement and continuous improvement should be problem-free, since the 'what could go wrong' possibilities have already been considered and addressed, and people from all functional areas of the organization should have been involved and consulted during the Create and Design stages. Seven: Applying the Prescription: Some Examples To give you a flavour for how this prescription could work in practice, here are eight fundamental business problems from different industries, and some innovations that have recently been (or are currently being) successfully commercialized to solve them. In each case, the solution shown could reasonably have been derived using the principles and process in the prescription above:
Conclusion This presentation was itself the result of addressing an unmet need: After reading dozens of books on innovation, I was unable to find one source that explained in clear terms what innovation is, in a business context, conveyed the urgent need for businesses to become more innovative, and provided an actionable prescription for doing so. This paper was initially developed to provide the Core Innovation Team of Ernst & Young with background on the history, current state and leading practices in business innovation, and I am now using it to develop part of a core curriculum on entrepreneurship, of which innovation is a critical element. I hope this analysis has given you a better understanding of the subject and its importance, and some useful tools and ideas that you can use to make your organization more innovative as well. I would welcome the opportunity to continue the discussion on this subject, by e-mail or through the comments thread below. You can find more of my writings on business innovation in this index. While I'm optimistic that this prescription will work within business and other organizations, large and small, I am less convinced that it will work to solve some of the more deep-seated human needs and inexorable problems that plague us today, such as global warming, pollution, the energy crisis, biodegradation, endemic war, violence, mental illness and disease, animal cruelty, urban sprawl and decay, crime, unemployment, and the inequitable distribution of resources, income, wealth and power. While the process should work in principle, it is unlikely that this process can be followed with sufficient rigour or resources without (a) a willingness by governments to spend much more money (paid for by taxes) to solve these problems, (b) a political will to solve such problems creatively and by consensus, rather than leaving it to private interests to address them or dealing with them by brute force, and (c) a much greater awareness, commitment and sense of responsibility by the body politic of the urgency and opportunity to solve these problems. But just as business will be driven once again to invest in innovation in the search to sustain profitability, it is likely that private citizens and public institutions will ultimately be driven to invest together in innovation in the search for a liveable, sustainable world. The process they then use will probably look a lot like this prescription. Bibliography
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