Tuesday, July 27, 2004

HBS Working Knowledge: Business History: How Tide Cleaned up the Competition This excerpt from the new book "Rising Tide" by the HBS Press, details the process by which P&G famously changed its industry and then itself through a single innovation - namely Tide, the first commercial synthetic detergent.

In a story that will be all too familiar to many corporate innovators, Tide (or "Product X") as it was then called, nearly died in the labs. When asked how long it would take to take the product to market, the initial estimates were upwards of 2 years. However, in a shock move, P&G execs decided to break the traditional rules, bypassing the usual consumer and manufacturing tests to try and get a 2 year head start on their potential competitors. This gamble, which exposed P&G to some major risks for a company coming fresh out of a depression and only making $500 million in annual revenues, paid off - and it launched a company not previous geared for speed into a commanding first-mover advantage position.

The story is a classic innovation story - and is pretty well written - will be interesting to read the whole book!

Monday, July 26, 2004

HBS Working Knowledge: Innovation: Why Innovations Sit on the Shelf This HBS WK article is pretty interesting in its assertion that a lot of companies fail to innovate due to an inability to conduct candid conversations about internal problems. It goes on to say that most traditional change initiatives to foster this kind of conversation usually fail quite early, giving instead, the offering the following 4 point-process:

1. Advocate, Inquire, Repeat - "It's the leader's job to point managers and team members in a specific direction but to make sure it's a direction they can respond to. To effect innovation, a leader must advocate, then inquire, and continue to repeat these actions as necessary"

2. Cut to the Chase - "Energizing an initiative requires that the conversations about it focus on only the most significant factors facing the organization—the company's ability to carry out the initiative and any obstacles to performance"

3. Be Open and Inclusive - "Fundamental business innovations almost always require changing the worldview and the behaviors of a whole set of interdependent players—the CEO, the senior leadership team, and managers down the line. This won't happen without a collective, public conversation."

4. Strive for honesty alongside low risk - "By encouraging honesty, then rewarding it, leaders can demonstrate to all levels of the organization that candor is valued."

All of this is a little optimstic in its real-life assessment of risk and the ability to be open in the manner they ask for - but none-the-less, some interesting ideas

Thursday, July 22, 2004

Innovation Becoming Higher Priority in Global Companies The Conference Board did some sort of survey of 100 global companies which has had some interesting results:

- 70% hold innovation in high regard

- 90% say innovation is integrated into strategic goals

- 55% (only??) have expanded their definition of innovation to include business model, strategy and process innovation.

- Although 80% of surveyed companies have central R&D units, on average, only 55% of innovation originates from inside the companies themselves

- Companies are encouraging a wider array of employees to collect information from their customers and solicit ideas from the broad employee population (nothing new there - this has been a common practice for quite a while now amongst leading innovators)

- Globality is becoming more important - 40% say that internal teams have global membership (presumeably then, overcoming problems in language difference is becoming increasingly important)

- 60% of HR people say they have a formal process for gathering ideas from employees, and the number of ideas (as well as the financial payoffs from implementation) are increasing.

- About 40% of firms now say they have someone who fills the role of a Chief Innovation Officer - although in many cases it is the head of R&D or the CTO...

Thursday, July 15, 2004

BRW Magazine - "In a word" This article by Darryl Bubner comments on Australia's misguided policies that are designed to, in theory, boost innovation, but in practice, do anything but.

For example, govt. funding for textile companies to upgrade equipment id given under the guise of innovation - but seeing as this is the same equipment everyone else buys - where's the innovation? Or the "Innovation Insights" program that aims to help manufacturing companies share best practices - something that is undoubtedly a good thing - but something that is undoubtedly contrary to the principles of innovation. As the author so rightly points out - "it is adoption and adaption, not innovation".

This article inadvertently though brings up some further fundemental problems that are starting to creep into the innovation "industry": that of increasing misdirection. Every new consultant and academic wishing to make a name for himself, starts off by taking the common set of terms and definitions for innovation, and renaming them to suit themselves. In that way, we now have little i vs Big I, Incremental Innovation vs Radical Innovation, Procedural Innovation vs Disruptive Innovation, and the list goes on. The words are all essentially saying the same thing - but using different terms - and the net effect of this is to create confusion (confusion I'm sure many consultants have no trouble solving for clients for a nice fee!). InnovationNetwork's Joyce Wycoff recently started up an initiative to try and come up with a set of common definitions and models, and whilst I applaud her desire and effort to do this, the sceptic (or some would say realist) in me fears it is a doomed effort as there is no money to be made in uniformity and clarity.

What will it take to solve the solution? Send us suggestions to research@imaginatik.com - we'll print any good ones we get :)