Tuesday, February 24, 2015

Making innovation a valuable habit

You may be thinking to yourself that the title of this blog post is boring, or even redundant.  Of course we want to emphasize valuable habits.  And innovation can lead to valuable outcomes.  But what about the "habit" part?  Aristotle noted something about his fellow humans.  He said that "you are what you repeatedly do".  He recognized that the more we do certain things, the more we followed certain norms, the more they influenced who we are and how we look at the world.  This is interesting in itself, but troubling from an innovation standpoint.  Because if we are what we repeatedly do, we'll never innovate.  If we are what we repeatedly do, we're all efficiency managers, not innovators.  That could explain a lot about the barriers innovation faces in large corporations.

What are your habits?

Habits actually have a somewhat negative connotation any way, like biting your nails.  People often talk about "bad habits" but rarely talk about "good" habits.  Many of the activities and actions we take every day become ingrained habits.  Getting coffee, chatting about the corporate culture over the water cooler, grabbing lunch with the same people, arriving ten minutes late for scheduled meetings, and so on.  After a while these habits become so ingrained that they become the norms.  In fact, in many corporations it's the kiss of death to schedule a meeting after 3pm, for a couple of reasons, but the most important one of which is that so many people arrive for meetings late that each subsequent meeting gets pushed back.  We all sit around and shake our heads about how terrible it is that people can't show up on time, but no one takes the responsibility to change the habit, and soon it becomes the norm.  These "bad habits" become what the corporation expects, and soon become the norm that we teach newcomers.  Eventually what were once simply bad habits become the norm.

If we are what we repeatedly do, then we ought to be the world's best meeting managers, cost cutters, time managers, pre-planners and efficiency experts, since most people in corporations spend time in meetings, cutting costs or corners, planning the next meeting and trying to figure out how to do more with less.  These habits become ingrained, and eventually influence how people think.  If you don't believe this, try asking people to generate really creative ideas that will violate their cultural norms.  It's actually funny to watch people squirm.

Innovation as a valuable habit

If more innovation is vital to most corporations, but people are ingrained with efficiency, how do we make innovation a valuable habit?  Well, first we need to create the conditions where innovation is possible.  That means that executives have to communicate the need for innovation and build the environment, and establish the compensation and rewards.  Once the environment is right we need to task people to innovate, regularly and consistently, so that innovation tools and processes don't seem strange and new, but seem trusted and familiar.  If we repeatedly "do" innovation, we will become more innovative, and more capable innovators.  If we repeatedly "do" efficiency, we will remain capable cost cutters who recoil from the implications of innovation.

First we need to make innovation intentional.  That's where the executives come in.  They must link innovation to corporate strategy and make it valuable and purposeful.  Then they need to demonstrate commitment, because that's what will help most of the folks overcome inertia and become willing to adopt new thinking and processes.  Finally, we need to do innovation regularly, so that it becomes a habit.  Only then will innovation be as easy, and as acceptable as doing the everyday business as usual.

There's real work in making this transition. For decades we've developed managers who are efficiency experts, and many of them have progressed onwards into the management ranks.  We've given innovation skills and training short shrift, and efficiency is the habit, not innovation.  It's time to rebalance skills and reset the framework, expecting both innovation and efficiency.  You won't have to worry about the efficiency part of the equation - it's already an ingrained habit.  You will have to focus on innovation, to make it a habit, and the only way to make it a habit is to do innovation often, consistently and repeatedly, using the same approach.  There's a word that describes that consistent approach and repeated usage.  You need to understand that innovation is a "discipline" that must be practiced regularly.

Almost 40 years ago the Doobie Brothers, of all people, released an album titled "What were once vices are now habits".  If we follow that logic, then it should be apparent that what were once habits are now cultural norms.  And once something becomes embedded in the culture, only a radical effort to refocus, repurpose and rework is going to change.  We need to create innovation habits that lead to innovation norms, rather than allow our cultures, habits and norms resist innovation.
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posted by Jeffrey Phillips at 5:43 AM 0 comments

Monday, February 09, 2015

Innovators are pattern breakers

Over the last five years or so I've been asked many, many times about my opinion about corporate innovation.  Why is there so much demand for corporate innovation, yet so little practical result.  One could stipulate a number of reasons, including:
  • The lack of time or bandwidth
  • The focus on efficiency over experimentation
  • The lack of innovation skills or techniques
  • The inordinate rewards of short term thinking over long term success
  • Fear of the uncertain or unknown
And I'm sure we could continue this list ad infinitum.   These are all reasons why so many corporations can't successfully and continually innovate.  But over time I've come to realize a larger issue is at stake.  It's a problem of pattern recognition.  Most corporations believe that their customers' needs begin and end within the manner in which the corporations or the industry have defined their solutions.  As long as a new product or service can be delivered within those definitions agreed by the industry, then innovation is easier for the corporations to pursue.  But when a need or demand arises that falls outside of, or just adjacent to, the way an industry or corporation defines its solutions, everything falls apart.  Increasingly, innovation will be at the intersection of markets and industries, and corporations need to become far more flexible in how they define the market, the boundaries of their service offerings.

Top Down versus horizontal

Most companies develop a specific representation of a market, industry or segment.  For example, the haircare department at P&G wants to solve problems for people who want to wash or condition their hair.  But to an individual, that activity may be just a step in a complete journey from getting up to getting ready for work.  Should P&G decide to look at all the factors related to haircare in the customer's journey from waking up to leaving for work?  That could potentially broaden the opportunity and introduce new solutions, but they may have nothing to do with shampoo.

How the P&G hair care team looks at what a consumer needs or wants to accomplish in the morning, the "jobs to be done" if you will, starts and ends with their definition of the solution.  They might say "we are in the shampoo business" or "we are in the hair care" business.  But a consumer might say "I have a job to do to get up and get ready for work", one step of which is washing hair.  If an innovation opportunity or need emerges just before someone washes their hair, or just afterwards, does P&G pursue it, or assume that some other vendor who provides services or products that support he morning rituals will step in?  Does the P&G hair care team say "that's outside of our industry definition or sweet spot"?  Do they say "that's someone else's job to fill"?  Because if the gap is left in place long enough, someone else will fill it.

Customer Experience Journey

Here's where a customer experience journey map makes so much sense.  Trying to understand all of the things a customer is trying to do, both with your product or service, or just before or after it, instead of trying to optimize just a single step in the activity.  As long as we take a top down, very segmented view of the customer, we can solve only very small portions of their jobs, all the while missing or ignoring opportunities that are just adjacent to our capabilities or services.

You may say, well, if it's just adjacent to our services, we may not be in the best position or have the best capabilities to provide it.  And you might be right.  But what you are doing is opening the door for very similar competition to take up a very vital activity right next to your products and services.  And if they can solve the adjacent need that you've been ignoring, does it build credibility for them to get to solve the problems you've been focusing on all along - or worse, perhaps try to collapse the needs they are solving with the one you've been solving?  Isn't that what iTunes ultimately did?  Collapse several related solutions and needs into one more integrated solution?

Patterns, Corporate Capabilities and industry boundaries

We pride ourselves on our pattern recognition capabilities, but too often we become very comfortable in our our definitions and patterns.  Far too frequently we at OVO see opportunities that are just outside or just adjacent to solutions and frameworks that a corporation has defined.  They'll say that those needs are outside their competencies or focus areas, and they may be right.  But they leave the door open for other firms or new entrants to solve those problems and gain credibility, when with a little bit of work they could extend their capabilities and solve a greater portion of the customer's journey.

How much does your corporate capability limit your innovation potential?  Are you required to follow the industry in where you define where it begins and ends?  Do you understand the entire journey a customer is going through when they encounter your product or service?  Is there a more complete or integrated solution you can provide to ease the customer journey, even if it's not within your wheelhouse?  We need to define our opportunities within the confines of our capabilities, but always with an eye to understanding the total needs of a customer. When is the last time you developed a customer journey map for your customer's need?
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posted by Jeffrey Phillips at 7:35 AM 0 comments

Tuesday, February 03, 2015

What's your perspective on innovation?

Our clients are always interested in what will lead to the most innovation within their companies.  Is it the markets or industries they compete in?  Do they have a natural amount of innovation or resistance?  Do software firms innovate more than manufacturers?  Is it the culture of the organization?  If we have ping pong tables in the break room, will that make it more innovative?  How about the people?  Do we need hipsters, millennials, Boomers or some other segment?  Do we need creatives, designers, artists?  Sometimes it seems we could actually remake many corporations by merely suggesting that they need more designers or Millennials.  But while these factors contribute to innovation success, there are other factors that we care about.  One of them is passion.  Does an individual have passion for the problem and a desire to create a solution?  Will the individual move mountains to try to solve the problem?  Sounds like an entrepreneur, but given their head many corporate employees can identify challenges or problems where their passion lies.  And with passion comes commitment, engagement and many other factors that can drive a successful innovation activity.  But there's one other factor I always look for:  perspective.

Send me the shoes

There's an old story used to make a point, primarily to sales people, but it is entirely apropos here.  Two shoe salesmen are set to set up shop on an inhabited island that hasn't had a shoe franchise before.  When they get there they discover that the entire population is barefoot - no one has developed shoes or sold shoes to the population, and the population hasn't developed its own footwear. The first salesman sends a message back to HQ:  please come get me out of here.  None of the inhabitants wear shoes.  The second salesman sends a message back to HQ:  please quickly forward all the makes and models you can.  Nobody wears shoes here.  The market is huge.

In the world of sales, the idea that people who don't wear shoes also don't need shoes is nonsensical.  If the need isn't present, create the need and then fill it.  But look at the second salesman.  He recognizes a huge, untapped market because he believes he can fill needs customers aren't aware of.  Yes, it may take time to get the population to wear shoes, but once he convinces them of the need for shoes, he'll have the market to himself.  The two characters in this story represent two different and competing perspectives:  what is possible with a positive outlook, and how quickly people will surrender to a negative outlook.  What people do we want on an innovation project?  The people willing to take an expansive, inquisitive, positive take on any opportunity or challenge, regardless of their position, age, training, managerial level, zodiac sign or depth of innovation training.

A few days ago I wrote a post about the amount of opportunity available even in a highly competitive market.  Far too often corporations shy away from competing in what appears to be a "red ocean" - a highly competitive market with lots of competition and low margins.  Frankly, it makes sense to place investments where you can win more share and more margin.  But even in highly competitive markets there are opportunities.  We can look at Uber, NetFlix and AirBnB as just a few examples.  All three compete in what initially were highly competitive markets.  There are plenty of options for taxis or rental cars, movie rental options (at least while Blockbuster was around) and hotel rooms.  Each entered a competitive market and disrupted it by rejecting the status quo channels or business models and offering customers basically the same product but in a new way.  Do you think the first salesperson, dreaming up a new way to rent rooms to people, would have developed AirBnB?  No!  He'd say:  well, there are a lot of big companies competing in this space and a lot of the valuable real estate is locked up, and I don't have much pricing power or branding, so I'll go do something else.  The entrepreneurs behind AirBnB, Uber and NetFlix saw opportunity where others saw competition and struggle, and eventually forced the larger competitors to compete on their terms.

Why is corporate innovation so difficult

So, why is corporate innovation so difficult? For years we've told people what to think, how much risk to embrace, what mental models to use to think about their business.  We've preferred certainty to experiments, incremental change to creativity, short term thinking to long term thinking.  We've designed our teams to think like the first salesman.  Then every once in a while we gather a team and ask them to act and think like the second salesman, and frankly, they aren't prepared or capable to do that without some re-education and a whole lot of reassurance.

If you want more innovation, you need to train an army of people in your company who can execute flawlessly, improve efficiency AND who can easily and quickly think like and act like the second salesman.  It's not an either or proposition.  Efficiency and Innovation can, and must co-exist.  But we've been trained to believe that they are enemies, and that efficiency must prevail because it is predictable and safe.  On your innovation teams, how many people would rather be voted right off the island like the first salesman?  I suspect you'll find the answer is most, if not all of them.

You can hire designers, you can hire Millennials, you can hire creative types, and all of those factors may help you generate more ideas.  But until you impact the perspectives and expectations of the workforce within your company, you will rarely innovate successfully.
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posted by Jeffrey Phillips at 11:02 AM 0 comments

Monday, February 02, 2015

There's more innovation opportunity than you think

Just recently we were working with a client and our combined OVO/client team had created a number of really good ideas to develop as new products and services.  When we presented them to the senior executive sponsoring the activity, his response was mixed.  Some he liked, some he was uncertain about, and some targeted a market that is valuable but which also has a lot of embedded competitors.  His comment about innovation in that last space was basically to say there may not be a lot of room for innovation, perhaps the incumbents had the space locked up.  While I understood his concern, the comment was a bit deflating for the team.  Later, as the team debriefed the meeting, his concern came up.  My response was:  I'm sure many competitors and new entrants felt the same way about Blockbuster back in the days before NetFlix.  My point being that how we define an opportunity may lead us to ignore a valuable market opportunity, but changing how the market or segment is served may open what appears to be a closed or highly competitive market.

Because, after all, what did Redbox and NetFlix and eventually real time streaming of movies actually do?  In the end the consumer gets what they want, entertainment and content.  How they get it, the business model, channel and customer experience may have changed, but the ultimate service or product changed very little.  If we were to go back and think about disrupting Blockbuster when they had a shop on every corner, and a (relatively) deep selection of movies to choose from, we'd be crazy to enter and compete in the same way.  That wouldn't be innovation, but you see what I mean.  But by defining the market differently, by thinking about new channels, new experiences and solving problems that the customer had, even in the face of high competition from Blockbuster, NetFlix completely eliminated Blockbuster as a competitor, even thought Blockbuster had access to the same content and was trying to solve the same need.  The problem was that the customers ultimately cared less about obtaining the content from a corner store, and more about the breadth of offerings and convenience of returning movies through the mail.  Blockbuster built their franchise on a corner store model, and NetFlix innovated by pointing out that with a little foresight and planning you could see all the same content without ever going to the store, to choose movies or to return them.

Of course, you'll say to yourself, this is a classic reframing problem.  I should be in the "transportation" business, not the "wagon" business.  While this reframing exercise may seem a bit trite, it forces you to ask:  how should I compete to win those customers?  What does my competitor or the incumbent offer that the customer doesn't need?  What is in the currrent business model I could change or even remove?  The SIT and TRIZ folks will call this subtraction - what can I take away and have an equivalent or valuable product.  What can I change or add to the existing model that subverts it?  Removing the hassle of going to the store to acquire and worse return movies made it more convenient for consumers.

Everyone wants to find a "blue ocean" - a segment or space where there aren't any competitors.  What no one seems to realize is that even in the most competitive markets and segments there is plenty of innovation possibility, but to discover it we may need to reframe the problem or change the game.  Often the incumbents don't want to change - their models and channels are based on what they've built.  Innovators, entrepreneurs and newcomers aren't invested in the way things work, they are interested in introducing new perspectives or frameworks that subvert the dominant paradigm.  Sorry just had to work that in.  Too often managers and executives recoil from innovation in a highly competitive space, when perhaps it's exactly where they should spend their innovation efforts.  But because they compete for the same customers and deliver much of the same value proposition, they don't necessarily have to do so in the same business model, pricing, channels or customer experience models.  That's what we need them to see - we can innovate in these spaces, but only by reframing the problem, changing the business model or channels.  But when we win at doing that, we dissolve the incumbents competitive advantages at the same time. 
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posted by Jeffrey Phillips at 7:47 AM 0 comments

Tuesday, January 20, 2015

Innovation doesn't take a vacation

Yesterday, January 19th, we celebrated Martin Luther King Day in the US.  This is a Federal holiday meant to recognize and celebrate the work that MLK and others did to improve the lot of African Americans.  Since it is a Federal holiday, many businesses also recognize it, so yesterday, many employees stayed home, or used the long holiday weekend to visit family or make a quick get away.

Vacations and holidays are awesome. We all benefit from an opportunity to step away from our work, to recharge our batteries and refresh our thinking.  But one thing we all need to realize is that innovation, the inexorable march of change and emerging new ideas, never takes a vacation.  Innovation doesn't recognize holidays, or weekends, or sick days.  Innovation doesn't care about how busy you are just keeping up with day to day operations.  Innovation is out there, working, emerging, constantly evolving all the time.  When you take a day off, have a holiday or delay innovation activities or projects "until the time is right" then you are merely delaying the inevitable.  Because, to paraphrase Neil Young, innovation never sleeps, never vacations, never rests.  And the sooner you realize how quickly and how constantly innovation is occurring, the better you'll be able to either 1) decide to engage at the same level or 2) prepare to be eclipsed.

Now, this isn't a diatribe about holidays or vacations.  As Americans, we tend to work too much, ignore or reject vacation time.  Too much work leaves anyone tired, bored and uninspired.  Innovators recognize that new interactions or experiences can lead to new ideas or insights.  The challenge we face is that too often a vacation day or holiday simply compounds the amount of "business as usual" work we have to do the day we get back from holiday or vacation, because "business as usual" issues and work never sleep either.  If you are going to be behind in your work, and make choices between being behind at your regular work or your innovation efforts, which should you shortchange?  That depends.

It depends on how important you believe things like innovation, new product development, building the capability to change are to your business.  If your team believes that keeping pace day to day with existing competitors and products is most important, you'll shortchange innovation.  And you'll find yourself in good company, since most firms will emphasize day to day over the future.  You'll also have a much greater opportunity to commiserate with your colleagues, because all of those who focus on the mundane, business as usual will be disrupted, and far sooner than they can imagine.  Because innovation doesn't rest, doesn't sleep.  Here's the truth:  it only takes one innovator, one entrepreneur, one new entrant to disrupt a market.  If only one firm in your industry or one new entrant does innovate and create a compelling new product or service, it doesn't matter what the rest of the industry did.  If all of the other firms in your industry decide to shortchange innovation, and one new entrant creates a new product that customers demand, it's proof that innovation doesn't rest, doesn't take a vacation.

In fact it makes sense to say that new entrants, entrepreneurs and innovators should seek markets where the incumbents are taking a break, resting on past laurels, sure that existing channels, products and business models are secure.  We were busy celebrating Blockbuster just months before NetFlix swooped in to devastate its business model.  Nokia created and tested a touch screen phone years before Apple did, but safe and secure in cell phone handset leadership it did nothing.

If we were serious about innovation, here's what we should be using our vacations for - in fact what our employers should do:  intentionally send employee teams on vacation with the demand that they come back with interesting new ideas.  Send them someone new or different.  Send them somewhere that challenges their thinking and introduces new insights.  Perhaps every innovation project should begin with a vacation - a vacation from the mundane, day to day stuff that clogs our thinking. 

But this really isn't a blog about vacations.  This is a blog about persistence, about change, about the need to become far more vigilant.  As the character in the Great Gatsby replies when he was asked how he became bankrupt (gradually, then suddenly), innovators, entrepreneurs and new entrants don't sleep, don't put things off, don't wait until the time is right.  They are innovating now.  It's their number one priority.  Is it yours?  Can you afford to have another priority?
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posted by Jeffrey Phillips at 5:31 AM 0 comments

Monday, January 19, 2015

Sequels or new ideas

I was perusing Twitter, checking out the tweets of some of my favorite Tweeters, when a note from Saul Kaplan caught my eye.  He was poking fun at the prevailing need in the US to create "franchises" of successful ideas - the inevitable "sequel".  He wrote:

Sequel Nation. Windows 10, iPhone 6, Scary Movie 5.
From Saul Kaplan @skap5
Note that it is almost a given that any good product will spawn a sequel.  Whether that product is a software product (Windows moving on to its 10th "version") or a sequel of a TV show (Breaking Bad is spinning off Better Call Saul) or a movie (how many Terminator movies do we actually need?).  Just recently I saw that someone thought it would be a good idea to create the second "Hot Tub Time Machine", a movie that uses as it's central idea a bunch of morons who discover that a hot tub is actually a conduit to a worm hole that let's them travel through time.  Never mind the whole hot tub as time machine, did we really need a second one? Further, I saw an advertisement that the Odd Couple will return as a new series on CBS, with a Matthew Perry of Friends fame playing the Oscar role made famous by Jack Klugman.  So in this instance not only is the story a remake, but the actors are retreads from other sitcoms.  Given the overwhelming prevalence for sequels, we should start to investigate why there are so many, and what that means for innovation.

The rationale behind sequels

What every firm wants to create is a money making franchise that will spin out huge profits over a long period of time.  The idea of versioning or sequeling allows a company to take what was once a good idea and extend it, reaping more profits or benefits.  For strong product or good ideas, the concept of a sequel is almost a "no brainer".  You are simply building on a known success, which already has market viability and awareness. This minimizes marketing and advertising and creates links to what consumers already know.  In the minds of many execs, a sequel of an even poorly executed idea is often more promising than a completely new product or service.  Thus we are served Scary Movie 5, or a remake of Ghostbusters or Charlie's Angels, rather than completely new material.

This rush to sequels is supported by what I call the maximum loss hypothesis.  If I build on an already existing idea or franchise, I build on existing awareness and link to audience or client expectations.  While the audience may not expect much from Scary Movie 5, it knows WHAT to expect, and may already have decided that while the entertainment will be mediocre, it's worth what it costs.  Thus the maximum loss is relatively low.  If, on the other hand I invest in creating a completely new product, which the audience is unfamiliar with and doesn't link to other existing brands or products, the audience could ignore or reject it entirely, thus I lose both the investment in the new product and the opportunity cost of not investing in a sequel.  This is why we keep getting the same recycled dreck in the entertainment world, why Breaking Bad seems so unusual in a world of recurring Matthew Perry and other Friends cast spin-offs.  There's less to lose on the downside, which is accepted, along with the low ceiling that most sequels never do as well as their predecessors.

The rationale for new ideas

Genuinely new ideas are unusual and unfamiliar, and may not have the same social status or acceptance of older or reworked ideas.  Since the ideas are new, untested and unfamiliar, a larger investment in creating validity and awareness is often required.  Many corporations, in both the content world and the product world, shy away from an investment to create a brand for a new product.  It's much easier to extend a brand (Coke, Coke Zero, Cherry Coke, etc) than to create a new brand or market a new idea.  New ideas usually return only one of two outcomes:  they either strike out miserably or win big over the long term.  Note that neither of these outcomes is preferred.  A big strikeout - an investment without any return is a huge negative, as is a big return in the long term.  Most executives would rather settle for smaller, predictable returns in the short run rather than the opportunity for a larger but slower return overall.  New ideas that are really interesting or valuable take time to sell and take time to drive profits and revenue.

Thus we'll never really move all that far from the sequel.  Even firms like Apple, which seemed at first interested in "breaking the mold" are now more content to extend the brand.  The iPhone definitely broke the mold at the start, but now is satisfied to simply extend some features and add new "versions", but we're well past the risky stage.  What's the next iPhone that will disrupt the handheld market?  Will Apple create it, or will they simply version us to death?

Truly new ideas move us from certainty to a completely new insight or understanding.  They change the way channels work, the way we use products, even our expectations.  To become too dependent on sequels is to reject change.  We need new products and services, new innovation to refresh ourselves, our markets and our thinking.

We are our own worst enemy

Who is at fault for this avalanche of sequels?  We, the buying public, are.  As long as we pay money for Scary Movie 5, the firms that make decisions about which products to commercialize will create sequels.  We have far more power in this equation than you may believe.  This is a consumer driven economy, and if we consumers demand better and more interesting new products and services, the companies that create content, products and services will have no choice but to act.  So, if you want innovation, vote with your attention, your feet and your wallet.  Please do everything you can to avoid sequels and retreads.  Demand better, more interesting, more valuable products and services.  Otherwise, get ready for Scary Movie 6, coming to you in 2016.



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posted by Jeffrey Phillips at 8:51 AM 0 comments

Thursday, January 08, 2015

The difference between continuous improvement and innovation

It's a shame that no true standards body for innovation exists, because the lack of accepted definitions and standards allows anyone to claim anything is "innovation".  One of the biggest issues I face constantly is trying to help people understand why their continuous improvement programs aren't necessarily all there is to innovation.  After all, continuous improvement programs use brainstorming as a tool, seek to improve a situation or process or product and often result in a better solution.  Isn't that innovation?

Perhaps I can best illustrate by using an analogy.  Someone who uses a "paint by numbers" kit and a famous artist - let's use Picasso - can both be called "artists".  After all, they both use the same tools - paint and brushes, and they both produce finished paintings.  But, which would you pay more for?  Which is an incremental improvement and which is a masterpiece?

The problem with Six Sigma, Lean and Continuous Improvement adherents is that they act as if innovation is somehow derivative or subordinate to these tools, rather than acknowledging that innovation is a much broader set of outcomes and capabilities, and that continuous improvement is a small portion of a much larger innovation umbrella.  When innovation is defined in the context of Continuous improvement, it loses it's power to engage and to create, to generate completely new and unexpected products, services and business models.  Instead it is held captive to those who would seek a predictable but incremental solution every time.

The difference between the "painter" who dabs paint into numbered sections on a prepared canvas, and Picasso is that the paint by numbers adherent is merely improving an existing product, while Picasso is creating something new and unexpected.  In the paint by numbers example, there's little chance of failure, but the outcome is also fairly predictable - if not already presented on the box.  With little skill and little risk comes little reward.  If you want to call that innovation, that's fine, but your definition is far too limited.

A more comprehensive innovation definition will definitely include continuous improvement or "incremental" innovation, but expands to include radical or disruptive innovation which creates new and unexpected products, services, business models and other valuable outcomes.  We need this definition because it's possible to conceive of great new products and services that aren't based on incremental improvements to existing products, but the continuous improvement definition treats these outcomes as if they were magic.  They aren't, they are just the result of a more expansive definition and expectation for innovation.

Continuous improvement has its uses.  If the expectation and goal is to modestly improve an existing product or service, then continuous improvement makes sense and should be applied.  However, if the situation or need calls for a truly new product or service, continuous improvement can't countenance that need.  It turns to existing products and services and seeks to make them better, rather than confronting the fact that consumers or markets may require a completely new, radical and undefined solution.  This is innovation too, and it's not magic, just a different way of framing the definition.  Some of the tools are the same in incremental and disruptive innovation, but the mindsets, the expectations and the leaps of faith are very different.  If your innovation outcomes often result in products and services that look a lot like the products and services you already possess, your teams are too focused on continuous improvement.

Another difference between continuous improvement and disruptive innovation is that disruption (or creating entirely new products and services) requires creativity and the ability to recognize and respond to emerging or latent needs.  No one ever asked Picasso for cubism, and no one else was doing it until he created it.  Picasso was willing to step out of the impressionist school and create an entirely new way of looking at the world.  Anyone following a paint by numbers method will struggle to develop something new or different, until they choose to ignore the recommendations that link a paint color to a specific section of the painting, and go their own way.

Stop defining innovation by the tools you use, and start defining the innovation you need and want to do by the outcomes you expect.  The fact that I have a hammer in my garage does not make me a carpenter.  The fact that you can follow a manufacturer's color scheme does not make you an artist.  We need to remove these cramped and incorrect definitions of innovation, so our teams can fully explore and engage all that innovation has to offer.
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posted by Jeffrey Phillips at 7:17 AM 0 comments